Ride-sharing company Lyft Inc on Monday projected a current-quarter operating profit above Wall Street estimates, helped by a resurgence in airport travel and office commuting.
Ride-hailing company Lyft Inc on Monday projected a current-quarter operating profit above Wall Street estimates, helped by cost-cutting measures and a resurgence in airport and office commuting.
Lyft joins larger rival Uber Technologies Inc, which also forecast a strong quarter ahead by betting on cost controls and rising demand.
Uber and Lyft, which are vying for market share in the ride-sharing space, are benefiting from the reopening of cities, the rise of ride-hailing and the shift in consumer budgets toward convenience and affordable services. even though record inflation limits other purchases.
The recovery comes as Uber’s delivery businesses bounced back during the pandemic as both companies’ ride-sharing businesses suffered.
“Now that we’re entering a recession, the opposite is true … transportation is durable because we need to move, but delivery and takeout are less durable,” Lyft president John Zimmer said in an interview.
Lyft said it saw increased numbers of active riders, rides and drivers since the pandemic began and was “confident” in its ability to hit its 2024 financial goals.
Active users increased 7.2%, the lowest quarterly growth recorded so far this year, but revenue per active user increased 13.7%, the highest growth compared to the previous two quarters.
For the fourth quarter, the company expects Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization), a profitability metric closely watched by investors, to be between $80 million and $100 million, compared to forecasts. analysts at $84.5 million, according to Refinitiv IBES. data.
It forecast revenue between $1.15 billion and $1.17 billion, while analysts expect $1.17 billion.
Third-quarter operating profit was $66.2 million, beating analysts’ estimate of $62 million.
Revenue rose 22% to a record $1.05 billion, but fell short of the $1.06 billion estimate.
However, Lyft’s net loss widened to $422.2 million, or $1.18 per share, from $99.7 million, or 30 cents per share, a year earlier, due to impairment charges related to the closing of Argo AI, the autonomous vehicle startup in which the company had a stake.