Uber president says AI spending is getting 'harder to justify'

Uber reports exhausting its annual AI budget early in 2026 and is questioning whether AI investments are producing meaningful returns. Uber president and COO Andrew Macdonald says there is no clear connection between increasing token consumption for Claude Code and the delivery of useful consumer features. He notes that while more may be shipped implicitly, it is difficult to draw a direct line from metrics to outcomes such as a measurable increase in useful functionality. Uber spent $3.4 billion on research and development in 2025, and its CEO said AI investment increases are being offset by hiring fewer employees. Macdonald says the company must compare token consumption and cost against headcount, and that the trade is harder to justify without a direct link to user value.

"That link is not there yet, right? I think maybe implicitly there is more that is getting shipped, but it's very hard to draw a line between one of those stats and, 'Okay, now we're actually producing 25 percent more useful consumer features,'" said Macdonald. "I think over the coming quarters and years, maybe that will become clearer, but I think today it's hard, even if some of the underlying metrics are trending in a really astronomical direction."

"We're going to have to start talking about token consumption and the associated cost versus headcount," said Macdonald. "So if you're not actually able to draw a direct line to how much useful features and functionality you're shipping to your users, that trade becomes harder to justify."

"Uber spent $3.4 billion on research and development efforts in 2025, 9 percent more than it had spent the previous year. Earlier this month, Uber CEO Dara Khosrowshahi said the company was making up for its increasing AI investments by hiring fewer human employees."

Read at The Verge