Uber’s (NYSE:UBER) delivery offering Uber Eats is developing its AI (Artificial Intelligence) chatbot to gain an edge over its competitors, Bloomberg reported. Per the report, the chatbot will provide recommendations to food-delivery customers to enable them to place orders quickly, thus enhancing the overall customer experience and engagement.
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Uber launched its Delivery app, Uber Eats, over seven years ago. The business now includes applications like Postmates, Drizly, and Cornershop. The Delivery app drives user engagement with the overall Uber platform and brings new consumers to its network. In addition, it competes with numerous companies in the meal, grocery, and other delivery space, with the most prominent ones being DoorDash (NYSE:DASH) and Instacart.
Following a comparable approach, DoorDash announced earlier that it is exploring new ways through Generative AI to enhance the customer’s ordering experience on its platform. Moreover, the company launched AI and agent-powered voice ordering solutions. Meanwhile, Instacart rolled out Ask Instacart, its AI-powered search tool that ensures lower shopping times and provides personalized recommendations. It leverages the capabilities of OpenAI’s ChatGPT.
As rivals ramp up their AI capabilities, it is essential for Uber Eats to integrate AI into its platform to enhance the user experience and secure a competitive advantage. The Delivery segment accounted for about one-third of the company’s total revenue, implying that an improvement in the Delivery segment will support Uber’s overall success and drive its share price. As Uber strengthens its AI capabilities, let’s look at what the analysts recommend for its stock.
Is it Good to Buy Uber Stock?
Analysts are optimistic about Uber stock and recommend buying it. The company is focusing on driving mobility and delivery volumes, diversifying its platform, and growing advertising revenue. Also, cost-control measures augur well for growth. Further, in the Delivery business, the company has improved margins by reducing the cost per transaction, which bodes well for future growth.
Uber stock sports a Strong Buy consensus rating on TipRanks, reflecting 31 unanimous Buy recommendations. Also, analysts’ average price target of $59.13 implies 33.93% upside potential from current levels.
