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Lyft posts US$1.1b Q1 loss; sees losses peaking this year
RIDE services company Lyft Inc, which posted a US$1.1 billion quarterly loss on Tuesday, days ahead of rival Uber's IPO, forecast that its losses would peak this year as it controlled expenses and got more revenue from each customer.
"We are encouraged by our strength of our core business and see a clear path to profitability in ride sharing," said chief financial officer Brian Roberts, sparking a short-lived bump in shares that subsequently pared gains.
Lyft promised profit in ride-hailing services without giving any timeline, but it previously had warned regulators it may never make money overall as it invests heavily in self-driving cars, renting scooters and other ventures.
As ferocious growth slows at Lyft and Uber Technologies Inc, investors appeared uncertain how to interpret the company's performance, with shares moving up and down after the bell. Since Lyft's IPO on March 29, shares had fallen 23 per cent.
The report, Lyft's first as a public company, showed revenue nearly doubled for the quarter ended in March but forecast that growth would slow to 52-53 per cent for the full year. Lyft is watched as a bellwether for Uber, which will price its offering on Thursday.
Lyft said it was getting more revenue per customer, reducing incentives and boosting margins, although investments in areas such as self-driving, scooters and bikes were masking improvements in its core business. New technology to match drivers and riders, and higher-priced rides in luxury vehicles were helping boost margins, it said.
Lyft said its adjusted Ebitda margin improved to negative 28 per cent from negative 60 per cent a year ago. The company, which says it has nearly 40 per cent of the US ride-hailing market, said increased demand helped push revenue to US$776 million in the quarter, above analysts' average estimate of US$739.4 million, according to IBES data from Refinitiv.
A second-quarter revenue forecast of US$800-810 million was ahead of analysts' expectations of US$783.1 million.
The low end would amount to a revenue increase of 58 per cent, still far short of the growth Lyft has enjoyed recently.
Last year's second-quarter revenue got a boost from a price hike, making this year's comparison more challenging, Lyft said.
Atlantic Equities analyst James Cordwell called the results "pretty strong," with hints that Lyft was continuing to take market share from Uber.
Lyft's outlook did suggest "a meaningful slowdown in revenue", he said, adding that "the question will be whether this is just conservatism, Uber starting to fight back, or the company hitting tougher comps".
In a snub to Uber, Lyft also announced a partnership with Alphabet Inc's Waymo in which Lyft will deploy 10 self-driving vehicles around the Arizona city of Phoenix by the third quarter.
Uber has welcomed Waymo cars on its network but has not signed any deals.
Last year, Lyft had 30.7 million riders and 1.9 million drivers in more than 300 cities in the US and Canada. In comparison, Uber had 75 million riders and 3.9 million drivers in 65 countries. REUTERS