Lyft Beats on Bookings, Adds New Riders

08/05/2024

A Lyft driver center in San Francisco.

(Bloomberg) — Lyft Inc. reported first-quarter results and financial guidance that beat investors’ expectations, a sign of the company’s ability to retain and attract new riders in the US and Canada.

Gross bookings — a key industry metric representing the value of transactions for rides excluding tips — jumped 21% to $3.69 billion for the first three months of the year, the company said Tuesday, surpassing analysts’ estimates of $3.59 billion on average.

The number of active riders at 21.9 million also exceeded expectations, growing at the fastest pace since 2022. The company in a statement cited “improvement in rider retention along with an increase in new riders” and more focused efforts in its Canadian markets.

For the current quarter, the company expects to post approximately $4 billion to $4.1 billion in gross bookings. Wall Street had been expecting $4.02 billion.

“We are executing well and bringing much-needed innovation to the market. That’s why drivers and riders are choosing Lyft more often,” said Chief Executive Officer David Risher.

Lyft shares jumped as much as 14% after market on the results. The stock has rallied more than 90% over the past 12 months.

Lyft has struggled to win market share from its much-larger rideshare rival, Uber Technologies Inc., which operates on a global scale and has expanded into other areas like food delivery and taxi rides.

But Lyft’s revenue growth has accelerated and its net losses have narrowed since Risher assumed the role of CEO a year ago, as he focused on trimming costs, increasing customer satisfaction and luring riders with lower prices. The company has also made an effort to win over drivers by guaranteeing a certain percentage of take-home earnings and launching various programs such as pairing women riders with women drivers.

Over the past year, Lyft has also focused on expanding its presence in five of Canada’s largest cities, doubling rides and more than doubling new riders and driver hours in the first quarter.

On Tuesday, the company reported the second consecutive quarter of positive free cash flow and narrowed its net losses much more than analysts expected. Net losses for the first quarter were $31.5 million, compared with the average estimate for a loss of $59.7 million. Additionally, Lyft revised its full-year expectation that it will convert at least 70% of adjusted earnings before interest, taxes, depreciation, and amortization to free cash flow, up from 50% announced in February.

(Adds post-market share moves.)

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