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(Uber)

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Uber Technologies Inc. sees its grocery and retail deliveries growing faster than expected, underscoring the company’s effort to catch up with rival services from Instacart, DoorDash Inc. and Amazon.com Inc.

The company expects non-restaurant deliveries to hit an annual run rate of $12.5 billion in gross bookings by the end of 2025, a spokesperson said. That’s 25% more than the $10 billion run rate it shared in May. Uber is providing a projection now as the actual financial results for full-year 2025 won’t be disclosed until February.

The accelerating growth points to ongoing momentum at Uber’s delivery unit, which contributes nearly half of gross bookings and has been expanding at a faster clip than its signature ride-hailing business over the past three quarters. CEO Dara Khosrowshahi attributed the delivery segment’s strong performance to “robust growth” in grocery and retail orders when the company reported second-quarter earnings in August.

Though Uber is a leader in the U.S. rideshare market, it has acknowledged that it can do more to deepen consumer habits on the delivery side, especially in the competitive grocery and retail space dominated by players like Walmart Inc., Amazon and Instacart.

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Khosrowshahi ��

said in August that Uber still has “a long runway to drive further adoption” in delivery, noting that 75% of its rideshare customers have not tried ordering grocery and retail goods from the Uber app.

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Currently, Uber sees “a lot of usage for last-minute or urgent orders,” said Rebecca Payne, group product manager for grocery and retail. That may include missing recipe ingredients or miscellaneous items that travelers forgot to pack. Sundays at 6 p.m. is the peak time for grocery orders on Uber, the company added, with the most popular items being bananas, limes, lemons, cucumbers, Hass avocados and red roma tomatoes.

Susan Anderson, the company’s global head of delivery, is expected to provide more updates about the business during a keynote speech at the annual Groceryshop conference in Las Vegas on Sept. 28.

Uber has made a concerted effort in recent years to expand the delivery use case for its users. It has added a thousand new retailers since the start of the year, including Aldi Inc., Sephora, Best Buy Co, DSW, Dollar General Corp. and Dollar Tree Inc. Some of those had previously only been on the Instacart or DoorDash apps.

And on Sept. 25, the company announced it will offer weekly discounts on local fruits, vegetables, meats and dairy in the U.S., Canada, U.K., South Africa, France, Japan, Taiwan and Spain. It also released new app features to improve the shopping experience, including live order editing and the ability to list preferred backups when first-choice items are unavailable. On that point, it pledged to offer improved suggestions in the future for alternate items that would be based on factors like price, nutrition and past orders.