WeRide Stock Soars 40% On Uber's $100 Million Robo Taxi Expansion
GUANGZHOU, CHINA - APRIL 30: Passengers have their body temperature measured before taking a WeRide ... More L4 autonomous driving bus on April 30, 2022 in Guangzhou, Guangdong Province of China. Passengers can experience the driverless bus line in Guangzhou, which opens for a test ride from Saturday. (Photo by Chen Jimin/China News Service via Getty Images) China News Service via Getty Images
Shares in WeRide, a China-based autonomous vehicle technology provider, popped 40% Tuesday, according to Google Finance .
Why? The $2.6 billion (market capitalization) company is partnering with Uber – which is adding $100 million to its investment in WeRide – to expand its robotaxi services from Abu Dabhi to 15 more cities worldwide by 2030, according to CnEV Post .
Should you buy stock in WeRide? Although the company's revenue fell in 2024 and its losses are huge, Uber's vote of confidence in WeRide could contribute to significant growth and ultimate profitability.
WeRide – which operates a driverless commercial Robotaxi service in Beijing and does business in 10 countries – suffered a decline in revenue and a substantial loss in the fourth quarter of 2024, according to the company's Q4 2024 earnings call transcript.
More specifically, in the fourth quarter WeRide's revenue fell 3% to $15.8 million coupled with a net loss that increased 112% to $34 million, noted the earnings call transcript.
WeRide has the potential to grow rapidly – with positive contribution margins – with help from local partnerships. Outside China, the company provides 'autonomous vehicles and services to local partners and global platforms through a combination of selling the vehicles, charging a fixed service fee, and a revenue-sharing arrangement,' WeRide chief financial officer Jennifer Li told investors in the earnings call.
To be sure, WeRide faces challenges when it introduces autonomous vehicles in a new location. To overcome those challenges, WeRide builds up mutual trust – gradually introducing 'automobile driving products, like we can always introduce RoboSweeper at first, and also fixed-route minibus, which the challenges for safety for this product relatively low compared to the requirements for Robotaxi,' WeRide CEO Tony Han told investors, according to the earnings call.
This trust has scaled sufficiently for Uber to expand its partnership with WeRide. By 2025, Uber – which already operates a robotaxi service in Abu Dhabi, with Dubai next in line – will roll out WeRide's Robotaxi services in '15 new cities across Europe and other regions outside of China and the U.S.,' noted TipRanks .
This partnership splits up the work of operating robotaxis between the two companies based on their mutual strengths. WeRide provides the self-driving technology, while Uber integrates the service into its app and manages fleet operations, TipRanks reported.
WeRide offers another advantage to the ride-sharing giant's efforts to expand autonomous services globally. That's because WeRide's presence in 30 cities across 10 countries includes 'test licenses in China, UAE, Singapore, France, and the U.S.,' TipRanks reported, which will make it easier for Uber to overcome regulatory barriers to entry in key markets. Should You Buy WeRide Or Uber Stock?
Based on analyst price targets, WeRide stock has more upside than Uber. Two analysts who cover WeRide set an average price target of $22, according to Zack's – representing 133% upside.
Meanwhile, Uber – which is about to report first quarter 2025 results – has less upside based on analyst estimates. More specifically, the ride-sharing giant's stock has 5.6% upside based on the average price target of 33 analysts of $90,20, noted TipRanks .
The short-term fate of Uber's stock depends on whether the company beats expectations and raises guidance when it reports Q1 results. To do that, Uber would need Q1 earnings per share to exceed 51 cents while revenue rises by more than 15.8% to exceed $11.63 billion, according to analysts views featured by TipRanks .
With the global market for robotaxi services growing at an 80.8% average annual rate to $119 billion by 2031, according to Fortune Business Insights , WeRide stock may have further to rise with help from the Uber partnership.
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