Step 1: Since the initial data is \(u(0,y) = y^3\), try a solution of the separable form \(u(x,y) = y^3 g(x)\) with \(g(0) = 1\).
Step 2: Compute the partial derivatives: \(u_x = y^3 g'(x)\) and \(u_y = 3y^2 g(x)\).
Step 3: Substitute into the PDE \(u_x + y u_y = 0\):
\[y^3 g'(x) + y \cdot 3y^2 g(x) = y^3\left[g'(x) + 3g(x)\right] = 0\]Step 4: Since this must hold for all \(y\), the bracket must vanish:
\[g'(x) + 3g(x) = 0\]Step 5: This is a first order linear ODE in \(g\). Its solution is \(g(x) = C e^{-3x}\).
Step 6: Use \(g(0) = 1\) to find \(C = 1\), so \(g(x) = e^{-3x}\).
Step 7: Therefore
\[u(x,y) = y^3 g(x) = y^3 e^{-3x}\] \[\boxed{u(x,y) = y^3 e^{-3x}}\]