Lyft shares take a sharp U-turnShares of the ride-hailing Uber rival fell 36% after weak revenue guidance and a big L
- Lyft ran out of gas in the ride-sharing race after it posted an unexpected quarterly loss of 74 cents a share, vs expectations for a profit of 13 cents a share. Not only that, but the ride-hailing company issued first-quarter guidance that came in below Wall Street estimates.
- Shares plunged 36% on Friday, closing at $10.31 a pop as concerns mounted that Lyft may not have the horsepower to take on bigger rival Uber. Speaking of Uber, the ride-sharing kingpin posted a 49% increase in revenue for its strongest quarter ever, zooming past estimates.
- Back to Lyft, the December quarter’s financials underscored the flailing business model of Lyft, which mainly ferries passengers and is focused on North America. Unlike Uber – a global ride-sharing behemoth that can get you food, freight, pets, and people.
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Investors put pedal to the metalSome would have you believe that General Motors is considering taking what would be its second run at buying up Lyft and the totally unverified news revs investors the right way.
- If you believe Reddit, Lyft’s days as an independent public company could soon be over. The gossip mongers have been hard at work spreading rumors across social media platforms that General Motors, one of the biggest automakers in the US, is considering buying up the ride-share platform – it’s not a crazy idea considering GM already took a $6bn run at a buyout in 2016.
- Lyft’s an attractive acquisition target for any of the major automakers that are exploring and developing self-driving taxis in the US, a list that includes Amazon’s Zoox, Alphabet’s Waymo, Ford and VW’s Argo and obvs GM’s Cruise – owning Lyft would give them access to an established customer base and brand name. That being said, GM has declined to comment and these rumors are unsubstantiated at best.
- But that didn’t stop investors from sending Lyft shares up 24% last week, rallying nearly 17% on Thursday and seeing a 6% jump on Friday. Loop Capital posits that Lyft could be the newest memestock on the scene, which could mean mega gains on the way considering how active the retail trading crowd has been recently – both GameStop and Bed Bath & Beyond saw increased action on Friday.
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No lyft off any time soonRide-sharing giant Lyft has got in lane behind rival Uber, copying its plans to cut budgets and slow down hiring.
- Lyft is struggling to pick up enough pace as, like everyone, it battles more headwinds than a fart in a hurricane, with good ol’ supply chain constraints, inflation, fuel prices and a potential upcoming recession weighing it down. The company has shed over 60% in value this year. Yikes.
- Tech investment is cooling in general, and Lyft has frozen hiring apart from critical roles in order to save dolla – but stopped short of redundancies (according to the WSJ). Uber did much the same recently, with CEO Dara Khosrowshahi calling hiring ‘a privilege’ and claiming the market “is experiencing a seismic shift”.
- Lyft’s frugal plans haven’t gone down brilliantly though, with the stock dropping over 17% on Tuesday as part of wider market losses. Time to tighten those seatbelts.
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Lyft stalls on earningsLyft cruises through Q1, but investors pull the parking brake hard after seeing what the road ahead looks like.
- The stock reversed a whopping 27% in extended trading on Tuesday – if shares open there on Wednesday, it’ll be Lyft’s lowest price since October 2020. It comes despite the ride-sharing brand beating on the top end with revenues that were up 44% at $876m, and meeting forecasts on the bottom with EPS of $0.07.
- Active riders were down 5% QoQ to narrowly miss estimates at 17.8m, though revenue per rider of $49.18 beat estimates. So, customer demand is bouncing back from covid, but there still aren't enough drivers to meet that demand – Lyft reported a 40% increase in drivers YoY, but customers are still facing long wait times and higher prices.
- Investors did a U-turn after seeing current quarter guidance though. Lyft is gonna splash the cash on driver incentives to alleviate those supply pressures, which is set to weigh down profits. It’s now expecting revenues of up to $1bn when analysts were looking for $1.2bn – it’s not a good sign for other ride-sharing companies like Uber, who are set to report this week too.
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Lyft struggles to find speed controlLyft’s fourth quarter report misses the exit to a solid outlook and investors pull the brakes.
- The stock slid 8% in extended trading on Tuesday despite a Q4 that topped on both ends with EPS of $0.09 on revenues that were up 70% y-o-y (thanks to easy covid comparables) to hit $970m – almost near pre-pandemic levels.
- But other metrics didn’t fare quite as well. Active riders of 18.7m missed estimates of 20m, and it’s still struggling to find new drivers.
- It forecasts revenue of up to $850m for the current quarter, missing estimates of $989m and down 12% from Q4, as it continues to feel headwinds from Omicron.
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Roberts jumps ship... straight into the seaLyft’s long-time CFO, who helped take the company public, is bailing to join the world of blockchain.
- Brian Roberts is leaving to join OpenSea. It's one of the world’s largest NFT marketplaces and has exploded this year to process over $10bn in transaction value and even consider an IPO.
- Elaine Paul will be taking his place, moving over from Amazon Web Services.
- Web3 start ups are taking the market by storm, attracting not just crazy amounts of cash but also some crazy hot talent to lead the internet revolution.
A ride to the topLyft is back, baby! A return of drivers and a rebound in ride hailing saw the app’s shares bounce over 8% on Wednesday.
- Lyft posted a surprise Q3 profit and a revenue increase of 73%
- Investors hit the brakes this summer as the company battled a shortage in drivers, and shares have lost a third of their value since March.
- But drivers are coming back on board, and thank goodness for that: because demand boomed in the third quarter, and no one likes waiting for a ride.
A bumpy road to recovery as Lyft's Q2 results fail to wow investorsDespite releasing a solid earnings report that boasted 125% growth in revenue, soft guidance sends Lyft stock reversing over 10% on Wednesday.
Prices of ride-sharing giant Lyft plummeted to their lowest price since mid-May this week after the firm released its seemingly impressive second quarter report. The numbers themselves looked solid, but investors sent prices down 10.56% as they reacted to the company’s weak guidance. The company easily outpaced both the top and bottom lines, reporting a loss per share of $0.05 on revenue of $765 million, compared to expectations of a $0.24 loss per share on $696.9 million. Active rider numbers came in above expectations too, with 17.14 million active riders in the quarter versus the 15.45 analysts were expecting. Revenue revved up a whopping 125% in Q2, and the company reported its first ever quarterly adjusted EBITDA profit at $23.8 million.
It’s a significant milestone for a business and for our industry. Going forward we expect to maintain adjusted EBITDA profitability,
CEO Logan Green said on the company’s earnings call.
Despite reaching this new milestone and presenting some solid numbers, Lyft’s guidance didn’t live up to expectations and disappointment sent its shares down over 10% on Wednesday. The ride-sharing company expects to bring in between $850 million and $860 million – slightly down from the $869.1 million analysts were looking for. Prices closed Wednesday at $49.53.
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A trailblazing trio joins forcesLyft is joining forces with industry leading automaker Ford and its self-driving software partner Argo AI to offer a self-driving ride-hailing service. Its stock popped 5.33% on the news.
Ford (F) and its shiny EV range will team up with its self-driving partner Argo AI to take us into the future and launch Robotaxi service on Lyft’s network. The trailblazing trio will launch at least 1,000 of the Robotaxi’s on Lyft’s network in the next five years, starting with Austin and Miami. Ford (F) and Argo both have a huge fleet of test vehicles in those cities, but in the years to come the plan is to expand into all major U.S. cities from 2023 onwards. To quell any fears about getting into a robot car on the way to your Friday dinner, there will be safety drivers in the cars for at least the next two years.
The collab will be the first time a carmaker, a self-driving software developer and a ride-hailing company have joined forces, and it could be the key to figuring out how to make a commercially viable business from Robotaxi’s. Lyft abandoned its own Robotaxi dreams when it sold its self-driving tech segment to Toyota for $550 million.
Lyft loses ground on Q1 resultsIt’s not a good week for Lyft, which releases knockout Q1 earnings on May 4 but still sees prices fall, possibly due to disappointing rider figures.
Lyft’s Q1 results suggested that the ride-sharing app was back on the path to profitability as it beat all expectations, but investors weren’t so easily pleased and stocks lost over 6% with disappointment over active rider numbers.
Lyft reported a loss per share of $0.35 on revenue of $609 million, compared to expectations of a $0.53 loss per share on $558.7 million in revenue. It’s difficult to make year-on-year increase assessments because of the state of the world this time last year – Lyft revenue is down 36% y-o-y but up 7% from Q4, so signs of pandemic recovery are clear. The ride-sharing app reported a net loss of $427.3 million for the quarter, slightly worse than the $398.1 million loss in the same quarter last year; although its adjusted EBITDA loss was $73 million, which is $62 million better than the company’s most recent outlook.
”The improvements we’ve made over the last year are paying off - we’ve built a much stronger business. As the recovery continues, we are confident that we will be able to deliver strong financial results” said Logan Green, co-founder and chief executive officer of Lyft. “We expect to build a significantly larger company by attacking the trillion dollar plus market opportunity in front of us.”
But its active rider numbers is what has investors hitting the brakes – even though numbers beat expectations at 13.49 million vs 12.8 million expected, that’s a 36.4% drop from the same time a year ago as Lyft continues to feel the effects of the pandemic.
With the pending sale of its Level 5 self-driving division though, Lyft is setting itself up to win the transition to autonomous vehicles through its hybrid network of human drivers and AVs, investment into marketplace tech, and expansion of fleet management capabilities, which could place the firm back into the driving seat in years to come.
For Q2, Lyft expects revenue to come in at between $680 million and $700 million, which would be an increase of nearly 15% quarter-on-quarter with up to 106% growth year over year. After teasing us a few times with its profitability benchmark, it seems to be holding steady on its previous guidance, reinforcing plans to reach profitability on an adjusted EBITDA basis by Q3 of this year.
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Lyft erases gains in new driver battle developmentThe U.S. Labor Secretary causes a stir by claiming that gig-workers should be classified as employees, continuing Lyft’s long battle with its drivers and sending prices down almost 10% to erase all its March and April gains.
Marty Walsh, formerly Mayor of Boston, came out last week as saying all gig workers, such as ride-sharing app drivers, should be treated as employees – a welcome development for drivers, who have been battling for this recognition for like, ever. Lyft and some its ride-sharing app buddies like Uber have had a long trip along the employee classifying road – a journey that cost the pair almost $200 million between them last year, when a California court ruled that drivers must be treated as employees and given minimum wage and overtime pay. A national (federal level) decision on who does and doesn't classify as an employee could have big implications for the U.S. workforce, up to a third of which are gig workers or contractors.
The benefits alone would cost Lyft a pretty penny, so it's understandable that they’d fight it, but it doesn't look like something that’s going away. Gig workers have been fighting for this for years, complaining about unfair working conditions, lack of health care, and straight up exploitation, and this classification of workers was hit especially hard in the COVID pandemic.
"We are looking at it but in a lot of cases gig workers should be classified as employees... in some cases they are treated respectfully and in some cases they are not and I think it has to be consistent across the board,"
Walsh told Reuters in an interview, expressing his view on the topic for the first time and giving some early insight into the Biden administration's future stance on the issues.
"These companies are making profits and revenue and I'm not (going to) begrudge anyone for that because that's what we are about in America. But we also want to make sure that success trickles down to the worker.”
Marty Walsh is Biden’s top labor official, and though his words are not yet backed by any official federal action, they have still made waves among tech companies that rely on gig workers. Reforming labor laws is a key pillar of Biden’s platform, so it’ll be interesting to see how this plays out.
Lyft abandons the robotaxi dreamLyft prices sink on news that it’s selling its self-driving unit to a Toyota subsidiary in a deal worth $550 million.
A subsidiary of Toyota called Woven Planet will buy Lyft’s self-driving car unit, it was announced Monday. The pair will work together to enhance self-driving tech safety, dashing the hopes of fans who’ve been keen for a Lyft robotaxi network in the near future – which would, to be fair, be awesome. Toyota will pay Lyft $200 million upfront and the rest over five years as it integrates the team into the Woven Planet subsidiary.
The move is expected to remove $100 million of annualized non-GAAP operating expenses on a net basis, and Lyft Co-Founder and President John Zimmer said that if the deal closes in Q3 as expected, investors could expect to see profitability on an adjusted basis in Q3.
“Not only will this transaction allow Lyft to focus on advancing our leading Autonomous platform and transportation network, this partnership will help pull in our profitability timeline,”
Zimmer said in a statement.
The announcement comes not long after rival Uber effectively left the self-driving car biz to the professionals after a few serious (and one fatal) setbacks, and sold its autonomous driving unit to Aurora Innovation at a $4 billion valuation. Lyft has been working on its own self-driving tech since 2017, but pressures to become profitable as soon as possible and the difficulties of the COVID pandemic have forced companies to scale back.
One Lyft executive said that this is just the industry becoming more realistic, letting the car makers make cars and the tech companies connect riders. Lyft still believes in an autonomous future, but it will put its efforts into deploying third party tech on its networks instead of making vehicles, and Lyft CEO Logal Green said:
“We look forward to continuing to partner with the best autonomous vehicle companies to bring this technology to market.”
Optimism for Q1Lyft lifts (see what we did there?) on the back of optimistic Q1 expectations, with forecast losses expected to beat analyst estimates as vaccines get underway and consumer confidence returns.
The company confirmed an expected adjusted loss for Q1 of $135 million, better than the $146 million expected by analysts, leading stock to jump 3.7% in after-hours trading.
The last week of February saw its best performance since the start of the pandemic, in terms of ride frequency, and average daily riders for February were up 4% on the previous month, suggesting that the tide might finally be turning.
“With new vaccines on the horizon, we’re seeing the worst of the pandemic in the rearview mirror,” said Lyft spokesman Eric Smith.
Lyft partners with Toyota on zero-emission rentalsLyft Canada teams up with Toyota Canada to offer its Vancouver drivers the chance to rent the world's first mass produced hydrogen-powered zero emissions model, the Mirai, through Toyota's KINTO share program.
KINTO’s origins lie in the word Kinto-un – Japanese for ‘flying nimbus’ – a service that quickly appears and, no matter where you are or what time it is, takes you wherever you wish to go. Nice idea. Toyota launched the program back in 2019 as a new mobility scheme for care sharing, rentals, leasing, pooling, subscriptions, and more. It's part of the firm's plan to transform into a "mobility" company rather than just a car manufacturer.
Lyft drivers in the US (along with Uber, DoorDash, and other gig workers) already use KINTO in several US locations including California, Las Vegas, Phoenix, and Salt Lake City. Now it's moved into Canada, one of the firm's biggest markets. It's a strong boost to its eco credentials, as well as moving it closer to its goal of 100% electric vehicles on its platform by 2030.
It's another bump for the share price as well, which ends the day up 1.02% at $57.65. Lyft has had a great month so far, with the stock up by over a quarter (27%) since the start of February. Onwards and upwards!
Better Q4 results see shares jumpLyft shares bounce 10% on the back of surprisingly strong Q4 2020 results, largely due to its aggressive cost-cutting measures.
The firm reported $569.9 million in Q4 revenue, down 44% year-on-year but still beating analyst expectations of $562.49 million, while losses narrowed to $0.58 per share, beating expectations of $0.72 per share. Net losses for Q4 2020 were $458.2 million, compared to a net loss of $356 million in Q4 2019.
Lyft said that although rides were down 51% year-over-year and active riders were down 45.2%, it was making more money off each ride at an average of $45.40, up 2.3% year-on-year and a 13.7% increase on the previous quarter.
For the full year, it reported 2020 revenue of $2.4 billion versus $3.6 billion in fiscal year 2019, a decrease of 35% year-over-year. Net losses for 2020 stood at $1.8 billion, against a net loss of $2.6 billion in 2019. So some improvement there.
In April 2020, the firm announced a restructuring effort to reduce operating expenses and adjust cash flows, and it's been largely successful. In November 2020, it also reduced its workforce to which resulted in net restructuring costs of $1.4 million, comprised of severance and employee costs, partially offset by a stock-based compensation benefit.
“In the fourth quarter, we successfully eliminated $360 million in fixed costs on an annualized basis versus our original 2020 plan, exceeding our target cost reduction by 20%,” said CFO Brian Roberts. “Our Q4 results also outperformed our most recent outlook. And, while the first quarter of 2021 continues to be uncertain primarily due to COVID-19 headwinds, based on current recovery expectations, we should experience a growth inflection beginning in the second quarter that strengthens in the second half of the year.”
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Taxi firms lose Canadian court caseIt's a good day for Lyft and a bad day for traditional cabs. Justice Sandra Wilkinson of the BC Supreme Court decides that the approvals for Lyft and Uber (UBER) to operate in British Columbia should stand – and fleet size isn't limited either.
The taxi firms were pretty pissed about this, because their own fleet sizes are limited, which could create a slightly skewed market in terms of competition. The approvals were issued to the ride-sharing apps by the Passenger Transportation Board a year ago, but the court case had dragged on till now, preventing them from setting up shop. Now though, there's nothing standing in their way.
According to Wilkinson's written ruling of January 20, 2021: "In each of the decisions, the board devotes numerous paragraphs to discussing whether an indeterminate fleet size will promote sound economic conditions in the passenger transportation industry. This is not a deferral of a decision or a failure to consider the issue of fleet size. I would go so far as to say that the board made a very common-sense decision in the circumstances.”
The share price did a little hop up to over $50 on the day of the ruling, but stayed static around $48 for most of the week.
Lyft entry boosts car ownershipRide-sharing apps like Lyft and Uber bump up car ownership by 0.7% in urban areas, says the New Scientist.
The research, from Jeremy Michalek at Carnegie Mellon University, analyzed trends in vehicle ownership in 224 urban areas across the US between 2011 and 2017 to investigate how these were influenced by ride-sharing companies – either Uber or Lyft – entering the area.
“We would have expected ownership to probably go down, because when people gain access to this alternative travel mode they may be able to get away with not owning a car, or owning fewer cars in their household,” said Michalek. But instead, it went up. Cool beans, but why? Possibly, because the drivers themselves end up buying new cars in order to work for the ride-shares. So, employment AND economic benefit. That's a pretty positive result.
Lyft offers free vaccine ridesLyft partners up with JP Morgan, health insurer Anthem, and community non-profit United Way to launch a high-profile new vaccine access campaign to provide 60 million rides to and from vaccination sites for low-income, uninsured, and at-risk people. It's some seriously good PR and it pumps the share price back above $50.
“Making sure people can get to vaccination sites when they need to is mission critical to beating this virus,” said Lyft Co-Founder and President, John Zimmer. “This is an opportunity to use our collective strength to mobilize on a massive scale and serve our communities. We cannot let lack of transportation be a factor in determining whether people have access to healthcare.”
It marks a wider Lyft strategy to further develop its healthcare business, which already has its own division within the company and which has been a key priority since 2016. As of 2020 the firm partners with nine of the top 10 largest health systems and nine of the 10 largest non-emergency medical transportation brokers to provide patient journeys. It has also partnered Epic, one of the most widely used electronic-health-record (EHR) services in the US, through which doctors can arrange transportation for patients directly with Lyft.
Lyft looks to go fully driverless by 2023Lyft partners with driverless technology firm to launch a fully self-driving service across the US by 2023. It's the dream – but is it achievable? The market seems to think so, and the stock is up to $49.91 from $47.23 a week earlier.
Lyft has been working with Motional (a $4bn joint venture between tech firm Aptiv and auto giant Hyundai) since 2018, and by December 2020 had provided more than 100,000 self-driving paid rides to its customers. They seem to have gone down pretty well, with 94% saying they'd do it again. So Lyft and Motional take the next step, with plans to launch fully driverless vehicles across the Lyft network in 2023 in multiple US cities. It's the first deployment partnership between a rideshare company and a driverless technology provider, and it's pretty cool that Lyft snuck in there in front of its rival Uber, which abandoned its own self-driving attempt earlier in the month.
It's a big deal – but it's not good news for Lyft drivers, who already have a bit of a shaky relationship with the firm. Driverless cars would be great for Lyft (and possibly its customers) but they have the potential to put a whole lot of people out of work.
Lower Q4 lossesLyft says that Q4 losses are likely to be lower than expected, at less than $185m, citing improving margins and rigorous cost controls. It also predicts quarterly revenues to increase by up to 15%, and thinks rider numbers will increase by up to a million by the end of the year. Take that, COVID19.
Finally, some great news for Lyft with a forecasted 1m uptick in riders by the end of the year. Photo: Lyft.