Uber Technologies (UBER 0.03%) has come a long way from its early days as a cash-burning disruptor of the taxi industry. Today, it's a profitable global platform with multiple engines of growth that span mobility, food delivery, logistics, and advertising.

But after its share price has more than doubled in the past two years, the stock is no longer cheap. With a trailing price-to-sales (P/S) ratio of around 4.6, it's fair for investors to ask: Has the stock run too far ahead of its fundamentals?

While the valuation looks high at first glance, the underlying business might justify the premium.

Image source: Getty Images.

Profitability is no longer just a promise

For years, Uber followed a growth-at-all-costs strategy. That's no longer the case.

After delivering its first annual profit in 2023, Uber delivered higher revenue and earnings in 2024. Operating income more than doubled from $1.1 billion to $2.8 billion in 2024, and free cash flow also more than doubled from $3.4 billion to $6.9 billion.

Uber's profitability streak continued in Q1 2025 when it generated $1.2 billion in operating income on $11.5 billion of revenue. Free cash flow expanded 66% year over year to $2.3 billion.

This all demonstrates that its profitability isn't just a temporary condition. The company has fundamentally realigned its business and cost structure, and the results are showing in growth and margins.

A multi-engine platform

Uber might have started as mainly a ride-hailing operator, but in recent years, it has evolved into a diversified platform. That gives the company multiple ways to expand.

Mobility remains its core business, and it's still growing nicely and delivering solid margins and profits thanks to its leadership position in most of its markets. Similarly, delivery -- its second-largest business by revenue -- is now profitable and continues to expand into higher-value verticals like groceries and alcohol. Freight, while still a relatively small revenue contributor that is almost breaking even, adds to the company's long-term optionality in logistics and enterprise transportation.

Beyond its core segments, Uber has quietly worked on its monetization, scaling smaller businesses like Uber Ads (advertising) and Uber One, its membership subscription business. This blend of services gives Uber an edge over pure-play delivery or rideshare companies, and it has a huge pool of 150 million monthly active users, plus a vast merchant base, to monetize.

Uber's platform also enjoys powerful network effects. As more users join it, it attracts more drivers and merchants. In turn, that drives more transactions, making it even more attractive to customers. That flywheel doesn't just fuel growth -- it also generates a growing pool of first-party data. And with that data, the company's other services like Uber Ads become more effective, enabling better targeting and higher-margin monetization across the ecosystem.

And let's not forget other opportunities exist in areas like autonomous ride-hailing and delivery, or its international expansion. While these businesses are still nascent, they have huge growth potential that could rival, if not exceed, Uber's core businesses.

Putting Uber's valuation into context

Trading at 4.6 times sales, Uber is by no means a bargain. While it's still some distance from the peak P/S of 10.1 that it reached in 2021 during the pandemic, it has about tripled the low point of 1.6 touched in mid-2022.

Today, Uber's valuation sits close to midway between the valuations of peers DoorDash and Lyft.

Data source: Macrotrends.net.

DoorDash is priced for high growth, but its margins are far thinner, and its business is less diversified. Lyft trades at a steep discount but lacks the scale, international reach, and cross-selling synergy that make Uber more compelling.

So, while Uber's valuation is not cheap, it's not irrational either, especially considering its growing profitability and market opportunities.

What it means for investors

Uber stock may no longer be a value play, but it's also no longer just a growth story stock.

Today, it has a track record it can point to with solid earnings, multiple growth levers, and optionality.

For long-term investors, the question isn't whether Uber is cheap based on one headline metric. It's whether the company can keep executing across its different segments to sustain growth and expand margins. If it can do so, its current share price is quite reasonable.