Last Tuesday, February 13, Lyft’s share price showed growth in extended trading but then began to move along a downward trajectory after the company’s CFO reported an error in the brand’s earnings release.
The mentioned firm’s revenue for the fourth quarter of 2023 was fixed at $1.22 billion. This figure is 4% higher than the result recorded for the same period in 2022. It is worth noting that revenue for the last quarter of 2023 coincided with the preliminary expectations of LSEG analysts for the corresponding figure.
Adjusted earnings per share of the company amounted to 18 cents. The mentioned analysts predicted that this figure would be 8 cents.
Lyft CFO Erin Brewer said at an earnings press conference that the margin increase was incorrectly indicated in a press release on the relevant topic. Instead of 500 basis points, or 5% growth in 2024, the actual increase will be 50 basis points, or 0.5%.
Erin Brewer also reported that the adjusted profit margin as a percentage of bookings for the current year will be 2.1%. In 2023, this figure was 1.6%.
After the publication of the earnings report, the company’s share price increased by more than 60%. After the error in the press release became known, the impressive indicator weakened significantly. The value of the brand’s shares increased by about 16% against the background of the publication of correct information.
In the fourth quarter of 2023, Lyft recorded a net loss of $26.3 million. Over the same period in 2022, this figure was fixed at $588.1 million.
According to StreetAccount, Lyft will record gross bookings in the financial range of $3.5 billion to $3.6 billion for the first quarter of the current year.
The company expects to be able to generate positive free cash flow in 2024. Also, the firm in the current year intends to implement plans for a slight reduction in capital expenditures.
Lyft has faced difficulties since its initial public offering in 2019. The company spent cash on paying drivers and competing with a larger rival, which is Uber.
Lyft CEO David Risher, who took over the firm in March last year, said that the brand has managed to achieve a record number of annual riders.
In the fourth quarter of 2023, the number of rides amounted to 191 million. This indicator increased by 26% year-on-year. The number of active riders in the last three months of 2023 amounted to 22.4 million. This indicator showed an increase of 10% year-on-year.
David Risher says that continuous innovation gives passengers and drivers different reasons to choose Lyft. In this context, he separately noted the differentiated proposal, which is the function that prioritizes matching women and non-binary drivers and riders. Since its launch in September 2023, two-thirds of eligible drivers and millions of riders have been using the feature.
Last November, Lyft added an on-time pickup promise for scheduled rides to the airport in major markets. As part of this solution, the customer receives compensation in the amount of up to $100 in the form of company credits if the driver does not pick up the passenger within 10 minutes after the scheduled time.
As we have reported earlier, Nomura Downgrades Uber and Lyft.
