What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2025-02-14 compared with 2024-02-15 · 199 added, 157 removed, 463 unchanged (43% of the section changed)

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Additionally, we may not have adequate Driver supply as Drivers may opt out of our platform given the loss of flexibility under an employment model, and we may not be able to hire a majority of the Drivers currently using our platform.

Any of these events could negatively impact our business, result of operations, financial position, and cash flows.

Any of these events could negatively impact our business, results of operations, financial position, and cash flows.

For a discussion of risk factors related to how misclassification challenges may impact our business, result of operations, financial position and operating condition and cash flows, see the risk factor titled “-Our business would be adversely affected if Drivers were classified as employees, workers or quasi-employees” included in Part I, Item 1A, “Risk Factors”, and Note 14 – Commitments and Contingencies to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

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Revenue $ 37,281 $ 43,978 18 % 19 %

Income (loss) from operations $ (1,832) $ 1,110 **

Net income (loss) attributable to Uber Technologies, Inc.

Income from operations $ 1,110 $ 2,799 152 %

Net income attributable to Uber Technologies, Inc.

$ 1,887 $ 9,856 **

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(3) MAPCs presented for annual periods are MAPCs for the fourth quarter of the year.

(4) Net cash provided by operating activities and free cash flow during the year ended December 31, 2022 reflected an approximately $733 million (£613 million) cash outflow related to the resolution of all outstanding HMRC VAT claims that were paid during the fourth quarter of 2022.

(4) Net cash provided by operating activities and free cash flow during the year ended December 31, 2023 reflected an approximately $789 million (£631 million) cash outflow related to payments of HMRC VAT assessments for the period of March 2022 to June 2023.

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Highlights for 2024

In the fourth quarter of 2023, our MAPCs were 150 million, growing 8 million, or 6%, quarter-over-quarter, and growing 15% compared to the same period in 2022.

In the fourth quarter of 2024, our MAPCs were 171 million, growing 14% compared to the same period in 2023.

Overall Gross Bookings increased by $24.9 billion in 2024, up 18%, or 21% on a constant currency basis, compared to 2023.

Mobility Gross Bookings grew 32% year-over-year, on a constant currency basis, primarily due to increases in Trip volumes.

Delivery Gross Bookings grew 15% year-over-year, on a constant currency basis, primarily driven by an increase in delivery orders and higher basket sizes.

Freight Gross Bookings declined 25% year-over-year, on a constant currency basis, primarily attributable to lower revenue per load and volume both a consequence of the challenging freight market cycle.

Revenue was $37.3 billion, up 17% year-over-year.

Mobility revenue increased $5.8 billion primarily attributable to an increase in Mobility Gross Bookings of 31% year-over-year.

Delivery revenue increased $1.3 billion primarily attributable to an increase in Delivery Gross Bookings of 14% year-over-year.

Revenue growth was partially offset by a $1.7 billion decrease in our Freight business, with Freight Gross Bookings declining 25% year-over-year.

Additionally, the increase in Mobility and Delivery revenue was partially offset by business model changes in some countries that classified certain sales and marketing costs as contra revenue, which negatively impacted revenue by $368 million and $796 million across Mobility and Delivery, respectively.

Mobility Gross Bookings grew 25% year-over-year, on a constant currency basis, primarily due to an increase in Mobility Trip volumes.

Delivery Gross Bookings grew 17% year-over-year, on a constant currency basis, primarily driven by an increase in Delivery Trip volumes.

Freight Gross Bookings declined 2% year-over-year, on a constant currency basis.

Revenue was $44.0 billion, up 18% year-over-year, primarily attributable to an increase in Gross Bookings of 18%.

The increase in Gross Bookings was primarily driven by an increase in Mobility and Delivery Trip volumes.

The increase in revenue was partially offset by business model changes in some countries that classified certain sales and marketing costs as contra revenue, which negatively impacted revenue by $863 million and $713 million across Mobility and Delivery, respectively.

Net income attributable to Uber Technologies, Inc.

was $1.9 billion, which includes the favorable impact of a pre-tax unrealized gain on debt and equity securities, net, of $1.6 billion primarily related to changes in the fair value of our equity securities, including:

a $985 million net unrealized gain on our Aurora investment, a $443 million net unrealized gain on our Didi investment, a $84 million net unrealized gain on our Joby investment, and a $80 million net unrealized gain on our Grab investment.

was $9.9 billion, which includes:

(i) a $6.4 billion benefit from the release of our valuation allowance of certain U.S.

federal and state deferred tax assets and (ii) the favorable impact of a pre-tax unrealized gain on debt and equity securities, net, of $1.8 billion primarily related to changes in the fair value of our equity securities, including:

a $723 million net unrealized gain on our Grab investment, a $629 million net unrealized gain on our Aurora investment, and a $357 million net unrealized gain on our Didi investment.

Adjusted EBITDA was $6.5 billion, growing $2.4 billion year-over-year.

Mobility Adjusted EBITDA profit was $5.0 billion, up $1.7 billion year-over-year.

Delivery Adjusted EBITDA profit was $1.5 billion, up $955 million year-over-year.

These increases were partially offset by a $216 million increase in Corporate G&A and Platform R&D costs, year-over-year, as well as a $64 million decrease in Freight Adjusted EBITDA year-over-year.

Mobility Adjusted EBITDA was $6.5 billion, up $1.5 billion year-over-year.

Delivery Adjusted EBITDA was $2.5 billion, up $965 million year-over-year.

These increases were partially offset by a $57 million increase in Corporate G&A and Platform R&D costs, year-over-year

We ended the year with $7.0 billion in unrestricted cash, cash equivalents and short-term investments.

During the fourth quarter of 2024, we redeemed $2.0 billion of our outstanding debt.

For additional information, see Note 8 – Long-Term Debt and Revolving Credit Arrangements to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

In January 2025, we announced that we entered into an accelerated share repurchase (“ASR”) agreement with a large financial institution to repurchase $1.5 billion of our outstanding common stock as part of our previously announced Share Repurchase Program.

The transactions under the ASR agreement were completed during the first quarter of 2025.

For additional information, see Note 10 – Stockholders' Equity to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Components of Results of Operations

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Promotions to end-users considered customers are recognized as contra-revenue while promotions to end-users not considered customers are recognized as sales and marketing expenses.

For additional discussion related to our revenue, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Critical Accounting Estimates - Revenue Recognition” as well as “Note 1 – Description of Business and Summary of Significant Accounting Policies - Revenue Recognition,” and “Note 2 – Revenue” to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Cost of Revenue, Exclusive of Depreciation and Amortization

Cost of revenue, exclusive of depreciation and amortization, primarily consists of costs incurred for certain Mobility and Delivery transactions where we are primarily responsible for Mobility and Delivery services and pay Drivers and Couriers for services, certain insurance costs related to our Mobility and Delivery offerings, costs incurred with Carriers for Uber Freight transportation services, credit card processing fees, bank fees, data center and networking expenses, mobile device and service costs, and amounts related to fare chargebacks and other credit card losses.

We expect that cost of revenue, exclusive of depreciation and amortization, will fluctuate on an absolute dollar basis for the foreseeable future in line with Trip volume changes on the platform.

We expect that cost of revenue, exclusive of depreciation and amortization, will fluctuate on an absolute dollar basis for the foreseeable future primarily driven by Trip volume changes on the platform.

Operations and Support

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Also included is the cost of customer support, Driver background checks and the allocation of certain corporate costs.

We would expect operations and support expenses to increase on an absolute dollar basis for the foreseeable future as our business continues to grow and Trip volume increases, but decrease as a percentage of revenue as we become more efficient in supporting platform users.

We would expect operations and support expenses to vary from period to period on an absolute dollar basis, but decrease as a percentage of revenue as we become more efficient in supporting platform users.

Sales and Marketing

Sales and marketing expenses primarily consist of advertising costs, product marketing costs, discounts, loyalty programs, promotions, refunds, and credits provided to end-users who are not customers, compensation costs, including stock-based compensation to sales and marketing employees, and the allocation of certain corporate costs.

Sales and marketing expenses primarily consist of advertising costs, product marketing costs, consumer discounts, promotions, credits and refunds provided to end-users who are not customers, compensation costs, including stock-based compensation to sales and marketing employees, and the allocation of certain corporate costs.

We expense advertising and other promotional expenditures as incurred.

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We expense substantially all research and development expenses as incurred.

We would expect research and development expenses to increase and vary from period to period as a percentage of revenue as we continue to invest in research and development activities relating to ongoing improvements to and maintenance of our platform offerings and other research and development programs.

We would expect research and development expenses to increase on an absolute dollar basis and vary from period to period as a percentage of revenue as we continue to invest in research and development activities relating to ongoing improvements to and maintenance of our platform offerings and other research and development programs.

General and Administrative

General and administrative expenses primarily consist of compensation costs, including stock-based compensation, for executive management and administrative employees, including finance and accounting, human resources, policy and communications, legal, and certain impairment charges, as well as allocation of certain corporate costs, occupancy, and general corporate insurance costs.

General and administrative expenses also include certain legal settlements.

General and administrative expenses also include certain legal related accruals and expenses.

We would expect general and administrative expenses to increase on an absolute dollar basis for the foreseeable future as our business continues to grow and Trip volume increases, but decrease as a percentage of revenue as we achieve improved fixed cost leverage and efficiencies in our internal support functions.

General and administrative expenses as a percentage of revenue may vary from period to period as a percentage of revenue due to the variability of legal and regulatory-related expenses.

Depreciation and Amortization

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Interest Expense

Interest expense consists primarily of interest expense associated with our outstanding debt, including accretion of debt discount.

Interest expense consists primarily of interest expense associated with our outstanding debt, including amortization of debt discount and issuance costs.

For additional detail related to our debt obligations, see “Note 8 – Long-Term Debt and Revolving Credit Arrangements” to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

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Call Option”).

• Acquisition termination fee.

• Other, net.

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and Netherlands' deferred tax assets, and changes in tax laws.

The income tax benefit was $5.8 billion for the year ended December 31, 2024, which includes a $6.4 billion benefit related to the release of our valuation allowance on the U.S.

federal and state deferred tax assets, with the exception of our California R&D credits and other non-material deferred tax assets.

We regularly assess the need for a valuation allowance against our deferred tax assets.

In making that assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of all available evidence, whether it is more-likely-than-not that some or all of the deferred tax assets will be realized.

As of December 31, 2024, we demonstrated sustained profitability in the U.S.

based on U.S.

pre-tax book income adjusted for permanent book-to-tax differences.

Further, given our taxable income position for the annual period ended on December 31, 2024, we utilized more attributes than we generated, which reduces our U.S.

federal and state net deferred tax assets.

This information is both objective and verifiable;

thereby, representing strong positive evidence that carries significant weight.

Based on all available positive and negative evidence, including the objective and verifiable positive evidence as described above and anticipated future earnings, we concluded it is more-likely-than-not that a majority of our U.S.

federal and state deferred tax assets will be realizable.

We continue to maintain a valuation allowance against the California R&D credits, as we believe it is not more-likely-than-not to be realized, as we expect R&D tax credit generation to exceed our ability to use these credits in future periods.

Furthermore, based on available evidence, we believe it is more-likely-than-not that the Netherlands’ net deferred tax assets will not be fully realizable.

We will continue to maintain a valuation allowance against these net deferred tax assets.

We regularly review the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing taxable temporary differences and tax planning strategies by jurisdiction.

Based on our assessment of current income and anticipated future earnings, there is a reasonable possibility that we will have sufficient evidence to release a significant portion of the valuation allowance in the Netherlands within the next 12 months.

However, our judgment regarding future earnings and the exact timing and amount of any valuation allowance release is subject to change due to many factors, including future market conditions and the ability to successfully execute our business plans and/or tax planning strategies.

Release of the valuation allowance would result in the recognition of net deferred tax assets on our consolidated balance sheet and would result in an income tax benefit in the period the release is recorded.

The Inflation Reduction Act Corporate Alternative Minimum Tax (“CAMT”), which is a minimum tax calculated by reference to financial statement income, does not apply to the Company for the year ended December 31, 2024.

We could be subject to the CAMT in future years, which would require us to make minimum cash tax payments.

In addition, the Organisation for Economic Co-operation and Development has led international efforts among approximately 140 countries and taxing jurisdictions to propose and implement changes to numerous long-standing tax principles, including a framework that imposes a minimum tax rate of 15% in each taxing jurisdiction.

Under this guidance, we will be required to determine a combined effective tax rate for all entities located in a jurisdiction.

If the jurisdictional effective tax rate determined under these rules is less than 15%, a top-up tax will be due to bring the jurisdictional effective tax rate up to 15%.

We are continuing to monitor the pending implementation of these rules by individual countries and the potential impact on our business.

The provision effective in 2024 had an insignificant impact on our tax obligations for 2024.

Income (Loss) from Equity Method Investments

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Total costs and expenses 36,171 41,179

Income (loss) from operations (1,832) 1,110

Income from operations

Interest expense (633) (523)

Other income (expense), net 1,844 1,849

Income (loss) before income taxes and income from equity method investments (9,426) 2,321

Income before income taxes and income (loss) from equity method investments 2,321 4,125

Provision for (benefit from) income taxes 213 (5,758)

Income from equity method investments 107 48

Net income (loss) including non-controlling interests (9,138) 2,156

net income attributable to non-controlling interests, net of tax 3 269

Net income (loss) attributable to Uber Technologies, Inc.

Income (loss) from equity method investments 48 (38)

Net income including non-controlling interests 2,156 9,845

net income (loss) attributable to non-controlling interests, net of tax 269 (11)

Net income attributable to Uber Technologies, Inc.

$ 1,887 $ 9,856

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Total costs and expenses 97 % 94 %

Income (loss) from operations (6) % 3 %

Income from operations 3 % 6 %

Interest expense (2) % (1) %

Other income (expense), net 5 % 4 %

Income (loss) before income taxes and income from equity method investments (30) % 6 %

Income before income taxes and income (loss) from equity method investments 6 % 9 %

Provision for (benefit from) income taxes 1 % (13) %

Income from equity method investments — % — %

Net income (loss) including non-controlling interests (29) % 6 %

net income attributable to non-controlling interests, net of tax — % 1 %

Net income (loss) attributable to Uber Technologies, Inc.

Income (loss) from equity method investments — % — %

Net income including non-controlling interests 6 % 22 %

net income (loss) attributable to non-controlling interests, net of tax 1 % — %

Net income attributable to Uber Technologies, Inc.

(1) Totals of percentage of revenues may not foot due to rounding.

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2024 Compared to 2023

Revenue increased $5.4 billion, or 17% year-over-year.

Mobility revenue increased $5.8 billion primarily attributable to an increase in Mobility Gross Bookings of 31% year-over-year.

Delivery revenue increased $1.3 billion primarily attributable to an increase in Delivery Gross Bookings of 14% year-over-year.

Revenue growth was partially offset by a $1.7 billion decrease in our Freight business, with Freight Gross Bookings declining 25% year-over-year.

Revenue increased $6.7 billion, or 18% year-over-year, primarily attributable to an increase in Gross Bookings of 18%.

The increase in Gross Bookings was primarily driven by an increase in Mobility and Delivery Trip volumes.

Cost of Revenue, Exclusive of Depreciation and Amortization

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2024 Compared to 2023

Cost of revenue, exclusive of depreciation and amortization, increased $2.8 billion, or 14%, mainly due to a $1.6 billion increase in Driver payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, as a result of increased Mobility Gross Bookings, a $1.4 billion increase in insurance expense primarily due to an increase in miles driven in our Mobility business, and an $945 million increase in Courier payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, as a result of increased Delivery Gross Bookings in certain markets, partially offset by a $1.3 billion decrease in Freight Carrier payments due to reduced Freight Gross Bookings.

Cost of revenue, exclusive of depreciation and amortization, increased $4.2 billion, or 19%, mainly due to a $1.3 billion increase in insurance expense primarily due to an increase in insurance rate per mile and miles driven in our Mobility business, a $1.3 billion increase in Driver payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, as a result of increased Mobility Gross Bookings in certain markets, a $718 million increase in Courier payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, as a result of increased Delivery Gross Bookings in certain markets, and a $303 million increase in credit card processing costs, as a result of increased Gross Bookings.

Operations and Support

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2024 Compared to 2023

Operations and support expenses increased $276 million, or 11%, primarily attributable to a $132 million increase in employee headcount costs, a $58 million increase in Driver background checks, and a $47 million increase in external contractor expenses.

Operations and support expenses increased $43 million, or 2%, primarily attributable to a $66 million increase in employee headcount costs and a $34 million increase in stock-based compensation, partially offset by a $63 million decrease in Driver background check costs.

Sales and Marketing

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2024 Compared to 2023

Sales and marketing expenses decreased $400 million, or 8%, primarily attributable to a $448 million decrease in consumer discounts, promotions, credits and refunds to $1.7 billion compared to $2.2 billion in 2022.

The decrease in consumer discounts, promotions, credits and refunds is primarily attributed to business model changes in some countries that classified certain sales and marketing costs as contra revenue totaling $1.2 billion, partially offset by a $716 million increase in consumer discounts, promotions, credits and refunds spend globally.

Sales and marketing expenses decreased $19 million, primarily attributable to a $299 million decrease in consumer discounts, promotions, credits and refunds to $1.4 billion compared to $1.7 billion in the same period in 2023, partially offset by a $238 million increase in indirect advertising and marketing and a $41 million increase in external contractor expenses.

The decrease in consumer discounts, promotions, credits and refunds includes:

a decrease of $1.6 billion, primarily attributed to business model changes in some countries that classified certain sales and marketing costs as contra revenue, partially offset by a $1.3 billion increase in consumer discounts, promotions, credits and refunds globally.

Research and Development

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2024 Compared to 2023

Research and development expenses increased $366 million, or 13%, primarily attributable to a $223 million increase in employee headcount costs and a $155 million increase in stock-based compensation.

Research and development expenses decreased $55 million, or 2%, primarily attributable to a $112 million decrease in stock-based compensation, partially offset by a $48 million increase in employee headcount costs.

General and Administrative

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2024 Compared to 2023

General and administrative expenses decreased $454 million, or 14%, primarily attributable to a $327 million decrease in other corporate expenses and a $208 million decrease in legal settlements and legal expenses, partially offset by a $73 million increase in employee headcount costs.

General and administrative expenses increased $957 million, or 36%, primarily attributable to a $753 million increase in legal-related accruals and expenses and a $185 million increase in other corporate expenses.

Depreciation and Amortization

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2024 Compared to 2023

Depreciation and amortization expenses decreased $124 million, or 13%, primarily attributable to a $160 million decrease in amortization expenses due to acquired Postmates intangible assets being fully amortized in 2022.

This was partially offset by a $25

million increase in amortization for internally developed software.

Depreciation and amortization expenses decreased $112 million, or 14%, primarily attributable to a $103 million decrease in amortization and depreciation expenses due to various acquired intangible and fixed assets becoming fully amortized and depreciated during the period.

Interest Expense

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2024 Compared to 2023

Interest expense increased by $68 million, or 12%, primarily attributable to an increase in interest expense on our term loans due to higher LIBOR and SOFR rates.

Interest expense decreased by $110 million, or 17%, primarily attributable to the extinguishment of the 2025 Senior Note in the fourth quarter of 2023, extinguishment of our 2030 Refinanced Term Loans and the 2026 Senior Note in the third quarter and fourth quarter of 2024, respectively.

Other Income (Expense), Net

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Unrealized gain (loss) on debt and equity securities, net 1,610 1,832 14 %

Impairment of equity method investment (182) — **

Revaluation of MLU B.V.

call option 191 — **

Acquisition termination fee (1)

— (236) (100) %

Other, net (198) (77) 61 %

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Percentage of revenue 5 % 4 %

** Percentage not meaningful.

(1) Refer to Note 1 – Description of Business and Summary of Significant Accounting Policies included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K for further information on Foodpanda Taiwan.

2024 Compared to 2023

Interest income increased by $345 million primarily attributable to a larger investment portfolio and higher yields compared to the same period in 2022.

Gain on business divestitures, net increased by $190 million primarily due to a $204 million gain on the sale of interest in Careem Technologies in the fourth quarter of 2023.

Interest income increased by $237 million primarily attributable to a larger investment portfolio compared to the same period in 2023.

Gain on business divestitures, net decreased by $204 million primarily due to a $204 million gain on the sale of interest in Careem Technologies in the fourth quarter of 2023.

For additional information, see Note 17 – Divestitures included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Unrealized gain (loss) on debt and equity securities, net increased by $8.7 billion primarily represents changes in the fair value of our equity investments.

In 2022, unrealized loss on debt and equity securities, net, includes:

a $3.0 billion net unrealized loss on our Aurora investments, a $2.1 billion net unrealized loss on our Grab investment, a $1.0 billion net unrealized loss on our Didi investment, a $747 million change of fair value on our Zomato investment, as well as a $142 million net unrealized loss on our other investments in securities accounted for under the fair value option.

Unrealized gain (loss) on debt and equity securities, net increased by $222 million primarily represents changes in the fair value of our equity investments.

In 2023, unrealized gain on debt and equity securities, net, includes:

a $985 million net unrealized gain on our Aurora investments, a $443 million net unrealized gain on our Didi investment, a $84 million net unrealized gain on our Joby investment, and an $80 million net unrealized gain on our Grab investment,

In 2024, net unrealized gain on debt and equity securities, net, includes:

a $723 million net unrealized gain on our Grab investment, a $629 million net unrealized gain on our Aurora investment, and a $357 million net unrealized gain on our Didi

For additional information, see Note 3 – Investments and Fair Value Measurement included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Impairment of equity method investment represents a $182 million impairment loss recorded on our MLU B.V.

equity method investment.

For additional information, see Note 4 - Equity Method Investments included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Revaluation of MLU B.V.

call option represents a $191 million net gain for the change in fair value of the call option granted to Yandex (“MLU B.V.

Call Option”).

For additional information, see Note 4 - Equity Method Investments included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Provision for (Benefit from) Income Taxes

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2024 Compared to 2023

Provision for income taxes increased by $394 million primarily due to the deferred U.S.

tax impact related to our investments.

We regularly assess the need for a valuation allowance against our deferred tax assets.

As of December 31, 2024, we demonstrated sustained profitability in the U.S.

based on U.S.

pre-tax book income adjusted for permanent book-to-tax differences.

Further, given our taxable income position for the annual period ended on December 31, 2024, we utilized more attributes than we generated, which reduces our U.S.

federal and state net deferred tax assets.

This information is both objective and verifiable;

thereby, representing strong positive evidence that carries significant weight.

federal and state deferred tax assets will be realizable.

Provision for income taxes decreased by $6.0 billion primarily attributable to the release of $6.4 billion of our valuation allowance of certain U.S.

federal and state deferred tax assets in the fourth quarter of 2024.

Income from Equity Method Investments

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(In millions, except percentages) 2023 2024

Income from equity method investments $ 107 $ 48 (55) %

Income (loss) from equity method investments $ 48 $ (38) **

Percentage of revenue — % — %

** Percentage not meaningful.

2024 Compared to 2023

The change in income from equity method investments was not material.

The change in income (loss) from equity method investments primarily due to our portion of the net income (loss) of our equity method investment in Careem Technologies in 2024.

Segment Results of Operations

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For additional information about our segments, see Note 13 – Segment Information and Geographic Information in the notes to the consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Year Ended December 31, % Change

Year Ended December 31, 2023 to 2024 % Change

(In millions, except percentages) 2023 2024

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Segment Adjusted EBITDA

Segment Adjusted EBITDA is defined as revenue less the following expenses:

cost of revenue, exclusive of depreciation and amortization, operations and support, sales and marketing, and general and administrative and research and development expenses associated with our segments.

Segment adjusted EBITDA also excludes non-cash items, certain transactions that are not indicative of ongoing segment operating performance and/or items that management does not believe are reflective of our ongoing core operations.

For additional information, see Note 13 – Segment Information and Geographic Information to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Year Ended December 31, % Change

Year Ended December 31, 2023 to 2024 % Change

(In millions, except percentages) 2023 2024

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$ 4,052 $ 6,484 60 %

(1 ) Excluding stock-based compensation expense.

(1) Includes costs that are not directly attributable to our reportable segments.

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(2) See the section titled “Reconciliations of Non-GAAP Financial Measures” for more information and reconciliations to the most directly comparable GAAP financial measure.

** Percentage not meaningful.

Mobility Segment

For the year ended December 31, 2023 compared to the same period in 2022, Mobility revenue increased $5.8 billion, or 41% and Mobility adjusted EBITDA profit increased $1.7 billion, or 50%.

For the year ended December 31, 2024 compared to the same period in 2023, Mobility revenue increased $5.3 billion, or 26%, and Mobility Adjusted EBITDA increased $1.5 billion, or 31%.

Mobility revenue increased primarily attributable to an increase in Mobility Gross Bookings of 21%, driven by an increase in Trip volumes.

The increase in Mobility revenue was partially offset by business model changes in some countries that classified certain sales and marketing costs as contra revenue, which negatively impacted revenue by $368 million.

Mobility Adjusted EBITDA profit increased primarily attributable to an increase in Mobility Gross Bookings, partially offset by a $1.6 billion increase in Driver payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, and a $1.4 billion increase in insurance expense primarily due to an increase in miles driven.

Mobility Adjusted EBITDA increased primarily attributable to an increase in Mobility Gross Bookings, partially offset by a $1.3 billion increase in Driver payments and incentives recorded in Mobility Platform Participant direct transaction costs, and a $1.3 billion increase in insurance expense primarily due to an increase in insurance rate per mile and miles driven, a $188 million increase in credit card processing costs as a result of increased Gross Bookings, a $182 million increase in network costs, and a $125 million increase in headcount costs, recorded in Mobility other expense.

Delivery Segment

For the year ended December 31, 2023 compared to the same period in 2022, Delivery revenue increased $1.3 billion, or 12% and Delivery adjusted EBITDA profit increased $955 million, or 173%.

Delivery revenue increased primarily attributable to an increase in Delivery Gross Bookings of 14%, driven by an increase in delivery orders and higher basket sizes.

The increase in Delivery revenue was partially offset by business model changes in some countries that classified certain sales and marketing costs as contra revenue, which negatively impacted revenue by $796 million.

Delivery Adjusted EBITDA profit increased primarily attributable to an increase in Delivery revenue including advertising, partially offset by a $945 million increase in Courier payments and incentives that are recorded in cost of revenue, exclusive of depreciation and amortization, and a $116 million increase in employee headcount costs.

For the year ended December 31, 2024 compared to the same period in 2023, Delivery revenue increased $1.5 billion, or 13%, and Delivery Adjusted EBITDA increased $965 million, or 64%.

Delivery revenue increased primarily attributable to an increase in Delivery Gross Bookings of 17%, driven by an increase in Trip volumes, and a $461 million increase in advertising revenue.

Delivery Adjusted EBITDA increased primarily attributable to an increase in Delivery revenue including advertising, partially offset by a $718 million increase in Courier payments and incentives recorded in Delivery Platform Participant direct transaction costs, and a $168 million increase in indirect advertising and marketing, a $160 million increase in insurance expense primarily due to an increase in miles driven, and a $127 million increase in credit card processing costs as a result of increased Gross Bookings, recorded in Delivery other expense.

Freight Segment

For the year ended December 31, 2023 compared to the same period in 2022, Freight revenue decreased $1.7 billion, or 24% and Freight adjusted EBITDA declined $64 million to a Freight adjusted EBITDA loss of $64 million.

Freight revenue decreased primarily attributable to a decrease in Freight Gross Bookings due to lower revenue per load and volume, both a consequence of the challenging freight market cycle.

Freight Adjusted EBITDA declined primarily attributable to the $1.7 billion decrease in Freight revenue, partially offset by a $1.3 billion decrease in Freight Carrier payments recorded in cost of revenue, exclusive of depreciation and amortization.

For the year ended December 31, 2024 compared to the same period in 2023, Freight revenue decreased $104 million, or 2%, and Freight Adjusted EBITDA declined $10 million, or 16% .

Freight revenue decreased primarily attributable to a 2% decrease in Freight Gross Bookings due to lower revenue per load as a result of the challenging freight market cycle, partially offset by an increase in volume.

Freight Adjusted EBITDA declined primarily attributable to a $104 million decrease in revenue, partially offset by a $62 million decrease in Freight Carrier payments recorded in Freight Platform Participant direct transaction costs, and a $32 million decrease in Freight other expenses.

Certain Key Metrics and Non-GAAP Financial Measures

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We define Gross Bookings as the total dollar value, including any applicable taxes, tolls, and fees, of:

Mobility rides;

Delivery orders (in each case without any adjustment for consumer discounts and refunds);

Driver and Merchant earnings;

Driver incentives and Freight revenue.

Mobility rides, Delivery orders (in each case without any adjustment for consumer discounts and refunds, Driver and Merchant earnings, and Driver incentives) and Freight revenue.

Gross Bookings do not include tips earned by Drivers.

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Adjusted EBITDA.

See the section titled “Reconciliations of Non-GAAP Financial Measures” for our definition and a reconciliation of net income (loss) attributable to Uber Technologies, Inc.

See the section titled “Reconciliations of Non-GAAP Financial Measures” for our definition and a reconciliation of net income attributable to Uber Technologies, Inc.

to Adjusted EBITDA.

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2024 Compared to 2023

Adjusted EBITDA improved $2.3 billion, to $4.1 billion, primarily attributable to a $1.7 billion increase in Mobility Adjusted EBITDA, a $955 million improvement in Delivery Adjusted EBITDA, partially offset by a $216 million increase in Corporate G&A and Platform R&D costs as well as a $64 million decrease in Freight Adjusted EBITDA.

Adjusted EBITDA improved $2.4 billion, to $6.5 billion, primarily attributable to a $1.5 billion increase in Mobility Adjusted EBITDA, a $965 million improvement in Delivery Adjusted EBITDA, partially offset by a $57 million increase in Corporate G&A and Platform R&D costs.

Reconciliations of Non-GAAP Financial Measures

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• Adjusted EBITDA excludes certain legal, tax, and regulatory reserve changes and settlements that may reduce cash available to us.

The following table presents a reconciliation of net income (loss) attributable to Uber Technologies, Inc., the most directly comparable GAAP financial measure, to Adjusted EBITDA for each of the periods indicated:

The following table presents a reconciliation of net income attributable to Uber Technologies, Inc., the most directly comparable GAAP financial measure, to Adjusted EBITDA for each of the periods indicated:

Year Ended December 31,

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Adjusted EBITDA reconciliation:

Net income (loss) attributable to Uber Technologies, Inc.

Net income attributable to Uber Technologies, Inc.

$ 1,887 $ 9,856

Add (deduct):

Net income attributable to non-controlling interests, net of tax 3 269

Net income (loss) attributable to non-controlling interests, net of tax

(Income) loss from equity method investments

Provision for (benefit from) income taxes 213 (5,758)

Income from equity method investments (107) (48)

Interest expense 565 633

Other (income) expense, net (1,844) (1,849)

Interest expense 633 523

Income from operations 1,110 2,799

Add (deduct):

Depreciation and amortization 823 711

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Legal, tax, and regulatory reserve changes and settlements 9 1,123

Goodwill and asset impairments/loss on sale of assets, net 25 84

Goodwill and asset impairments/loss on sale of assets 84 3

Acquisition, financing and divestitures related expenses 36 25

Accelerated lease costs related to cease-use of ROU assets 6 —

COVID-19 response initiatives 1 —

Loss on lease arrangement, net 7 4

Restructuring and related charges 2 51

Mass arbitration fees, net (14) —

Loss on lease arrangements, net 4 2

Restructuring and related charges, net 51 25

Adjusted EBITDA $ 4,052 $ 6,484

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Free cash flow $ 3,362 $ 6,895

$ 390 $ 3,362

Liquidity and Capital Resources

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Net cash used in investing activities (3,226) (3,177)

Net cash provided by (used in) financing activities 15 (95)

Net cash used in financing activities

Operating Activities

Net cash provided by operating activities was $3.6 billion for the year ended December 31, 2023, primarily consisting of $2.2 billion of net income including non-controlling interests, adjusted for certain non-cash items, which primarily included $1.9 billion of stock-based compensation expense, $1.6 billion of unrealized gains from equity securities, $823 million of depreciation and

amortization expense, $204 million gain from business divestiture, as well as a $165 million decrease in cash consumed by working capital.

The decrease in cash consumed by working capital was primarily driven by an increase in our insurance reserves, partially offset by an increase in prepaid expenses and other assets as well as accounts receivable.

Net cash provided by operating activities was $7.1 billion for the year ended December 31, 2024, primarily consisting of $9.8 billion of net income including non-controlling interests, adjusted for certain non-cash items, which primarily included $6.0 billion of deferred income taxes, $1.8 billion of stock-based compensation expense, $1.8 billion of unrealized gains from equity securities, $737 million of depreciation and amortization expense, as well as a $2.4 billion increase in cash from working capital.

The increase in cash from working capital was primarily driven by an increase in our accrued insurance reserves primarily due to liabilities recorded during the period exceeding claims paid out, and accrued expenses and other liabilities, partially offset by an increase in accounts receivable and prepaid expenses and other assets primarily due to tax matters recorded as a receivable in other assets described in the Non-Income Tax Matters section below.

The increase in cash from working capital was primarily driven by an increase in our insurance reserves, partially offset by an increase in prepaid expenses and other assets as well as accounts receivable.

Net cash provided by operating activities reflects a cash outflow of approximately $789 million (£631 million) cash outflow related to payments of HMRC VAT for assessments for the period of March 2022 to June 2023.

For additional information on this matter, refer to Note 14 – Commitments and Contingencies to our consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Net cash provided by operating activities was $642 million for the year ended December 31, 2022, primarily consisting of $9.1 billion of net loss including non-controlling interests, adjusted for certain non-cash items, which primarily included $7.0 billion of unrealized losses from equity securities, $1.8 billion of stock-based compensation expense, and $947 million of depreciation and amortization expense, as well as a $335 million decrease in cash consumed by working capital.

The decrease in cash consumed by working capital and other operating activities was primarily driven by an increase in our insurance reserves and accrued expenses and other current liabilities, partially offset by higher accounts receivable.

Net cash provided by operating activities reflects a cash outflow of approximately $733 million (£613 million) related to the resolution of outstanding HMRC VAT claims that were paid during the fourth quarter of 2022.

Investing Activities

Net cash used in investing activities was $3.2 billion for the year ended December 31, 2024, primarily consisting of $12.8 billion in purchases of marketable securities, $289 million in purchases of non-marketable equity securities, $242 million in purchases of property and equipment, partially offset by proceeds from maturities and sales of marketable securities of $10.2 billion.

Net cash used in investing activities was $3.2 billion for the year ended December 31, 2023, primarily consisting of $8.8 billion in purchases of marketable securities, $223 million in purchases of property and equipment, partially offset by proceeds from maturities and sales of marketable securities of $5.1 billion and proceeds from the sale of an equity method investment of $721 million.

Net cash used in investing activities was $1.6 billion for the year ended December 31, 2022, primarily consisting of $1.7 billion in purchases of marketable securities, $252 million in purchases of property and equipment, and $59 million in acquisition of business net of cash acquired, partially offset by proceeds from maturities and sales of marketable securities of $376 million.

Financing Activities

Net cash used in financing activities was $2.1 billion for the year ended December 31, 2024, primarily consisting of $4.0 billion in principal repayment on term loan and notes, $1.3 billion in repurchases of common stock, $851 million in redemption of non-controlling interests, and $172 million of principal payments on finance leases, partially offset by $4.0 billion of proceeds from issuance of term loan and notes, net of issuance costs.

Net cash used in financing activities was $95 million for the year ended December 31, 2023, primarily consisting of $2.7 billion in principal repayment on term loan and notes, $171 million of principal payments on finance leases and $141 million to fund the cost of entering into the capped call transactions related to our 2028 Convertible Notes, partially offset by $2.8 billion of proceeds from issuance of term loan and notes, net of issuance costs.

Net cash provided by financing activities was $15 million for the year ended December 31, 2022, primarily consisting of proceeds from sale of subsidiary stock units of $255 million, and proceeds from the issuance of common stock under the Employee Stock Purchase Plan of $92 million, partially offset by $184 million of principal payments on finance leases, and $80 million of principal repayment on the non-interest bearing unsecured convertible notes related to the acquisition of Careem (“Careem Notes”).

Other Information

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Repatriation of funds may result in immaterial tax liabilities.

We believe that our existing cash, cash equivalents and short-term investments in the United States are sufficient to fund our working capital needs in the United States.

We believe that our existing cash balance in the United States is sufficient to fund our working capital needs in the United States.

We are in compliance with our debt and line of credit covenants as of December 31, 2024, including by meeting our reporting obligations.

We also believe that our sources of funding and our available line of credit will be sufficient to satisfy our currently anticipated cash requirements including capital expenditures, working capital requirements, collateral requirements, potential acquisitions, potential prepayments of contested indirect tax assessments (“pay-to-play”), and other liquidity requirements through at least the next 12 months.

acquisitions, potential prepayments of contested indirect tax assessments (“pay-to-play”), and other liquidity requirements through at least the next 12 months.

We intend to continue to evaluate and may, in certain circumstances, take preemptive action to preserve liquidity.

Debt Redemptions

On September 12, 2024, we exercised the call option for a partial redemption of $500 million for the 2027 Senior Note.

The partial redemption was completed on October 3, 2024.

In addition, on October 2, 2024, we exercised the call option to redeem the $1.5 billion 2026 Senior Note, we completed the redemption on November 1, 2024.

For additional information, see Note 8 – Long-Term Debt and Revolving Credit Arrangements in the notes to the consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Share Repurchase Program

In February 2024, our board of directors authorized the repurchase of up to $7.0 billion in shares of our outstanding common stock (the “Share Repurchase Program”).

The timing, manner, price and amount of any repurchases are determined by the discretion of management, depending on market conditions and other factors.

Repurchases may be made through open market purchases and accelerated share repurchases.

The exact number of shares to be repurchased by us, if any, is not guaranteed.

Depending on market conditions and other factors, these repurchases may be commenced or suspended at any time or periodically without prior notice.

As of December 31, 2024, we had $5.8 billion available to repurchase shares pursuant to the Share Repurchase Program For additional information, see Note 10 – Stockholders' Equity in the notes to the consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K.

The transactions under the ASR agreement were completed during the first quarter of 2025.

Freight Series A Preferred Stock

On October 6, 2023, the 2020 Freight Series A Investor exercised their right to require that either Freight Holding conduct an IPO or we redeem them.

Upon the redemption date in October 2024, we repurchased the 2020 Freight Series A Investor’s Freight Series A preferred stock in cash for $851 million.

For additional information, see Note 16 – Non-Controlling Interests in the notes to the consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

Non-Income Tax Matters

United Kingdom

On October 31, 2022, we settled our UK VAT dispute with the HMRC, the UK tax regulator, for all periods prior to March 14, 2022.

As a result of the settlement agreement, these prior periods are closed to assessment and Uber made a payment of approximately $733 million (£613 million) in the fourth quarter of 2022 for this resolution.

As of March 14, 2022, we modified our operating model in the UK, such that as of that date Uber UK is a merchant of transportation and is required to remit VAT.

Uber UK is remitting VAT under the Value Added (Tour Operators) Order 1987 (“VAT Order 1987”), which allows for VAT remittance on a calculated margin, rather than on Gross Bookings.

Throughout 2023, we received multiple assessments from the HMRC disputing our application of VAT Order 1987 application for the period of March 2022 to June 2023, totaling approximately $789 million (£631 million) for unpaid VAT.

Uber paid, and is

required to pay, these assessments in order to proceed with the appeal process.

As of December 31, 2024, we have received multiple assessments from the HMRC disputing our application of VAT Order 1987 for the period of March 2022 to June 2024, totaling approximately $1.6 billion (£1.3 billion) for unpaid VAT.

Uber paid the assessments in order to proceed with the appeal process.

The payments do not represent our acceptance of the assessments.

The payments made in 2023 are recorded as a receivable in other assets on our consolidated balance sheet because we believe that we will be successful in our appeal, upon which, the full amount of our payments will be returned to us with interest upon completion of the appeals process.

The payments made in 2023 and 2024 are recorded as a receivable in other assets on our consolidated balance sheet because we believe that we will be successful in our appeal, upon which, the full amount of our payments will be returned to us with interest upon completion of the appeals process.

We expect to receive additional assessments related to this matter and will be required to pay the assessments in order to continue with the appeals process.

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We may pay more than the minimum purchase commitment to our cloud-computing web services providers based on usage.

For the years ended December 31, 2022 and 2023, the amounts utilized for these agreements were immaterial.

For the year ended December 31, 2024, Uber satisfied its commitment for the 2022 Cloud Computing Service Agreements.

As of December 31, 2024, we had $2.7 billion in non-cancelable commitments, this includes the $2.5 billion in 2022 Cloud Computing Service Agreements discussed above.

The non-cancellable commitments have varying expiration terms through November 2029.

Share Repurchase Authorization

In February 2024, our board of directors authorized the repurchase of up to $7.0 billion in shares of our outstanding common stock.

The timing, manner, price and amount of any repurchases are determined by the discretion of management, depending on market conditions and other factors.

Repurchases may be made through open market purchases and accelerated share repurchases.

The exact number of shares to be repurchased by us, if any, is not guaranteed.

Depending on market conditions and other factors, these repurchases may be commenced or suspended at any time or periodically without prior notice.

Critical Accounting Estimates

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Our sole performance obligation in the transaction is to connect Drivers and Merchants with end-users to facilitate the completion of a successful ridesharing trip or delivery.

In certain markets, we also generate revenue from end-users and charge a direct fee for use of the platform or in exchange for Mobility or Delivery services.

In many of our markets, we also generate revenue from end-users and charge a direct fee for use of the platform or in exchange for Mobility or Delivery services.

Judgment is required in evaluating the presentation of revenue on a gross versus net basis based on whether we control the service provided to the end-user and are the principal in the transaction (gross), or we arrange for other parties to provide the service to the end-user and are the agent in the transaction (net).

The assessment of whether we are considered the principal or the agent in a transaction could impact the accounting for certain payments and incentives provided to Drivers and end-users and change the timing and amount of revenue recognized.

Driver Incentives

We offer various incentive programs to Drivers.

Judgment is required to determine the appropriate classification of these incentives.

Incentives provided to customers are recorded as a reduction of revenue if we do not receive a distinct service in exchange or cannot reasonably estimate the fair value of the service received.

Incentives offered in exchange for specific services, such as referral services are recorded as sales and marketing expenses.

End-User Discounts and Promotions

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Allocation of purchase consideration to identifiable assets and liabilities affects our amortization expense, as acquired finite-lived intangible assets are amortized over the useful life, whereas any indefinite lived intangible assets, including goodwill, are not amortized.

During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill.

During the measurement period, which may be up to one

year from the acquisition date, we may record adjustments to the assets acquired and liabilities assumed, with the corresponding offset to goodwill.

Upon the conclusion of the measurement period, any subsequent adjustments are recorded to earnings.

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If an equity investment is considered to be impaired we will establish a new carrying value for the investment and recognize an impairment loss through our consolidated statement of operations.

Investments in debt

securities are evaluated for impairment quarterly based on whether its fair value has declined below its amortized cost.

Investments in debt securities are evaluated for impairment quarterly based on whether its fair value has declined below its amortized cost.

In circumstances where we intend to sell, or are more likely than not required to sell the security before it recovers its amortized cost basis, the difference between the fair value and amortized cost is recognized as a loss in the consolidated financial statement of operations, with a corresponding write-down of the security’s amortized cost.

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We make certain judgments and assumptions to determine our reporting units and in allocating shared assets and liabilities to determine the carrying values for each of our reporting units.

Determination of reporting units is based on a judgmental evaluation of the level at which our segment managers review financial results, evaluate performance, and allocate resources.

Determination of reporting units is based

on a judgmental evaluation of the level at which our segment managers review financial results, evaluate performance, and allocate resources.

Judgment in the assessment of qualitative factors of impairment include, among other factors:

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Significant judgment is required to determine both the probability and the estimated amount of loss.

These estimates have been based

on our assessment of the facts and circumstances at each balance sheet date and are subject to change based on new information and future events.

These estimates have been based on our assessment of the facts and circumstances at each balance sheet date and are subject to change based on new information and future events.

The outcomes of litigation, regulatory, indirect tax examinations and investigations are inherently uncertain.

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We regularly assess the likelihood of adverse outcomes resulting from these examinations and assessments to determine the adequacy of our provision for income taxes.

Based on available evidence, management believes it is not more-likely-than-not that the net U.S., Netherlands, and other non-material jurisdictions’ deferred tax assets will be fully realizable.

In these jurisdictions, we have recorded a valuation allowance against net deferred tax assets.

We regularly review the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, excess tax benefits related to stock-based compensation, the expected timing of the reversals of existing taxable temporary differences and tax planning strategies by jurisdiction.

Our judgment regarding future profitability may change due to many factors, including future market conditions and the ability to successfully execute our business plans and/or tax planning strategies.

within the next 12 months.

However, our judgment regarding future earnings and the exact timing and amount of any valuation allowance release are subject to change due to many factors, including future market conditions, the ability to successfully execute our business plans, and the amount of stock-based compensation tax deductions available in the future.

Release of the valuation allowance would result in the recognition of net deferred tax assets on our consolidated balance sheet and would decrease income tax expense in the period the release is recorded.

The income tax benefit was $5.8 billion for the year ended December 31, 2024, which includes a $6.4 billion benefit related to the release of our valuation allowance on the U.S.

federal and state deferred tax assets, with the exception of our California R&D credits and other non-material deferred tax assets.

We regularly assess the need for a valuation allowance against our deferred tax assets.

In making that assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of all available evidence, whether it is more-likely-than -not that some or all of the deferred tax assets will be realized.

As of December 31, 2024, we demonstrated sustained profitability in the U.S.

based on U.S.

pre-tax book income adjusted for permanent book-to-tax differences.

Further, given our taxable income position for the annual period ended on December 31, 2024, we utilized more attributes than we generated, which reduces our U.S.

federal and state net deferred tax assets.

This information is both objective and verifiable;

thereby, representing strong positive evidence that carries significant weight.

federal and state deferred tax assets will be realizable.

Furthermore, based on available evidence, we believe it is more-likely-than-not that the Netherlands’ net deferred tax assets will not be fully realizable.

We will continue to maintain a valuation allowance against these net deferred tax assets.

Insurance Reserves

We use a combination of third-party insurance and self-insurance mechanisms, including a wholly-owned captive insurance subsidiary, to provide for the potential liabilities for certain risks, including auto liability, uninsured and underinsured motorist, auto physical damage, general liability, and workers’ compensation.

Insurance reserves is an estimate of our potential liability for unpaid losses and loss adjustment expenses, which represents the estimate of the ultimate unpaid obligation for risks retained by us and includes an amount for case reserves related to reported claims and an amount for losses incurred but not reported as of the balance sheet date.

Insurance reserves is an estimate of our potential liability for unpaid losses and loss adjustment expenses, which represents the estimate of the ultimate unpaid obligation for such insurance related risks and includes an amount for case reserves related to reported claims and an amount for losses incurred but not reported as of the balance sheet date.

The estimate of the ultimate unpaid obligation utilizes generally accepted actuarial methods applied to historical claim and loss experience.

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These reserves are continually reviewed and adjusted as experience develops and new information becomes known.

Adjustments, if any, relating to accidents that occurred in prior years are reflected in the current year results of operations.

Adjustments to reserves retained by us, if any, relating to accidents that occurred in prior years are reflected in the current year results of operations.

All estimates of ultimate losses and allocated loss adjustment expenses, and of resulting reserves, are subject to inherent variability caused by the nature of the insurance claim settlement process.

Such variability is increased for us due to limited historical

experience and the nature of the coverage provided.

Such variability is increased for us due to limited historical experience and the nature of the coverage provided.

Actual results depend upon the outcome of future contingent events and can be affected by many factors, such as claim settlement processes and changes in the economic, legal, and social environments.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis