Why Billionaire Bill Ackman Just Bet $2.3 Billion on Uber – And Why He Thinks It’s Still Cheap
Pershing Square had accumulated 30.3 million Uber shares, equating to a 1.4% stake valued at $2.3 billion, why?
In early 2025, billionaire investor Bill Ackman, CEO of Pershing Square Capital Management, made a bold move—he revealed a massive new stake in Uber Technologies. By January, Pershing Square had accumulated 30.3 million Uber shares, equating to a 1.4% stake valued at $2.3 billion.
Ackman didn’t hold back on his praise, calling Uber “one of the best-managed and highest-quality businesses in the world”—yet he also emphasized that the stock remained “massively undervalued” relative to its intrinsic worth.
So, what made Ackman pull the trigger on this high-conviction bet? Let’s dive deep into why one of the sharpest hedge fund managers in the world is betting big on Uber—and what investors might be missing.
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Catalysts Driving Ackman’s Uber Investment
Under CEO Dara Khosrowshahi’s leadership, Uber has transformed from a money-losing tech startup to a cash-generating machine.
✅ Uber Became Profitable for the First Time
After years of heavy losses, Uber turned the corner in 2024, posting its first-ever full-year operating profit and positive GAAP net income since its 2019 IPO.
✅ Explosive Free Cash Flow Growth
Uber generated $3.4 billion in free cash flow in 2024—a jaw-dropping leap from just $390 million in 2022.
✅ Aggressive Share Buybacks
Uber’s management clearly believed the stock was undervalued, authorizing a $7 billion buyback in early 2024, signaling confidence in future growth.
Ackman himself noted that Uber has “become highly profitable and is generating a ton of cash” under current leadership.
This transformation aligns perfectly with Pershing Square’s investment philosophy:
Find companies at an inflection point in profitability.
Invest in businesses with strong competitive moats.
Back top-tier management teams with a proven track record.
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Dara Khosrowshahi: The Architect of Uber’s Turnaround
Ackman is not just betting on Uber—he’s betting on Dara Khosrowshahi.
When Khosrowshahi took over in 2017, Uber was a mess—burning billions of dollars and plagued by scandals. Fast forward to 2025, and it’s a radically different company:
Revenue Growth: In Q4 2024, Uber posted $11.96 billion in revenue, beating analyst expectations with 20–25% year-over-year growth.
Profitability Boom: Adjusted EBITDA surged 40% year-over-year to $1.84 billion in Q4 2024, demonstrating the company’s expanding margins.
Operating Margins Finally Turned Positive: Uber’s full-year operating income hit $2.8 billion on $44 billion in revenue, with a 6% margin—a dramatic turnaround from deep losses just a couple of years prior.
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Is Uber Trading at a Massive Discount?
Despite its financial transformation, Uber’s stock still traded at just ~23× forward earnings in early 2025—a valuation that Ackman believes dramatically underestimates its true worth.
Even after climbing 30% in early 2025 to new all-time highs, Ackman remains convinced that Uber is still mispriced.
🚨 Missed the dip? When Uber stock pulled back 5% after Q4 earnings, it likely gave Pershing Square an even better buying opportunity.
Ackman’s thesis is clear:
1️⃣ Uber has an expanding moat in mobility, food delivery, and logistics.
2️⃣ It has entered a new era of sustained profitability.
3️⃣ The market hasn’t fully recognized its long-term value, making it a compelling investment opportunity.
The Moat That Makes Uber Nearly Untouchable
A key reason Uber is a core Pershing Square holding is its dominance in both ride-hailing and food delivery.
✅ Ride-Hailing Leader: Uber’s scale is unmatched—no competitor, including Lyft, comes close.
✅ Food Delivery Powerhouse: Uber Eats is one of the top players globally, benefiting from strong brand recognition and network effects.
✅ Multi-Faceted Business Model: Uber’s ecosystem extends to Uber Freight, offering a foothold in logistics and enterprise transportation.
Uber isn’t just a rideshare app—it’s an end-to-end mobility platform with multiple revenue streams that reinforce each other.
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What Everyone Gets Wrong About Uber
While many investors are fixated on Uber’s current business, Ackman is likely seeing its future potential—particularly in autonomous vehicles (AVs).
Instead of developing its own robotaxis (like Tesla or Waymo), Uber pivoted to becoming the preferred network for AV providers.
In 2025:
Alphabet’s Waymo partnered with Uber to launch autonomous rides in Austin, TX.
Uber is positioned to earn platform fees on AV rides, just like it does for human-driven rides.
This means Uber can profit from autonomous technology without the massive R&D risk—a strategy that Ackman sees as a potential “kicker” in its valuation.
Why Ackman’s Uber Bet Aligns With Pershing Square’s Playbook
Ackman’s Uber investment checks every box of a classic Pershing Square trade:
✔ Expanding Profit Margins & Free Cash Flow: Uber’s 30%+ projected EBITDA growth mirrors Ackman’s best past investments.
✔ Wide Competitive Moat: Uber dominates ride-hailing, food delivery, and logistics—businesses that new entrants can’t easily replicate.
✔ Strong Management & Governance: With Khosrowshahi at the helm, Uber has gone from a chaotic startup to a well-oiled profit machine.
✔ Long-Term Growth Potential: The total addressable market (TAM) for mobility and delivery is trillions of dollars, and Uber is still just scratching the surface.
Ackman has a history of identifying great companies that the market underestimates—and Uber fits the bill perfectly.
Bottom Line: Why Ackman Is All-In on Uber
Bill Ackman is betting big on Uber because:
✅ The company has hit an inflection point in profitability.
✅ Its moat is widening, giving it pricing power and long-term dominance.
✅ The market is still underestimating its true value.
Pershing Square’s research-driven, concentrated approach has uncovered another high-quality business trading at a discount—and Ackman is positioning accordingly.
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