Stock market today: S&P 500, Nasdaq head for records as trade talks, Fed rate cut bets in focus

Uber (UBER) and Lyft (LYFT) stocks both fell more than 2% on Friday after Canaccord Genuity downgraded the ride-hail platforms to Hold from Buy when analyst George Gianarikas assumed coverage of the stocks the prior day.

Gianarikas said it would take only 411,000 robotaxis to replace all Uber and Lyft drivers in the US.

“Now, we are not sure it all happens that quickly, but there is very much a non-zero probability that it does.”

While the platforms have been integrating robotaxis into their offerings — for example, Uber has partnered with Waymo, and Lyft with Mobileye and others — Gianarikas said that “hybrid” approach may not help them in a future robotaxi-dominated market.

“The challenge for UberLyft is how long a hybrid network will stay relevant, and then what value they can add over the long-term in a new paradigm,” he wrote.

“The future could be bright: value added in the AV world through hybrid human-robot networks, strong on the ground operations, and other tactical elements,” he added. “An alternative scenario is also plausible: a new world dominated by a few AV behemoths that control the value chain and leave UberLyft reflecting on the golden days of the past. It is truly unclear.”