Why did Lyft crash?

Lyft stock is getting punished, down more than 35% after weak guidance. Shares of Lyft fell Friday, a day after the company reported guidance for its first quarter of 2023 that was short of analyst expectations. Lyft's CFO pointed to “seasonality and lower prices” to explain the guidance.



People Also Ask

The pandemic initially walloped Lyft by drying up demand for ride-hailing services, a blow Uber was able to soften through an aggressive expansion in food delivery. That gave people a reason to continue using Uber's app even when they were stuck at home while Lyft fell out of favor.

MORE DETAILS

Lyft reported a net loss of $187.6 million, or 50 cents a share, including stock-based compensation costs and related payroll expenses of $186.6 million. In the year-ago period, the company lost $196.9 million, or 57 cents a share.

MORE DETAILS

While Uber diversified its business beyond ride-hailing by delivering meals and grocery items, Lyft never did. That arguably hurt the company earlier in the pandemic when fewer customers were traveling but more were ordering items online.

MORE DETAILS

As of 2022, Uber has a 71% share of sales in the U.S. rideshare market, whereas Lyft only has 29%. However, both have seen significant sales increases since 2021. As of January 2022, Uber's sales are up 84%, and Lyft sales are up 62% year-over-year.

MORE DETAILS

Uber and Lyft have comparable gross margins, but Lyft's operating costs-to-sales are far higher due to immense stock-based compensation. Given Lyft's liquidity position and cash burn rate, I do not believe it will survive through 2024.

MORE DETAILS

What happened? Well, as predicted, Uber didn't want to spend the $9 Billion that Lyft was asking for. In 2014, Uber tried to acquire the app with no success. Then, in 2019, Uber was prepared to buy Lyft for $7 Billion, but the ship had sailed, and Lyft rejected the idea, and instead stayed a separate entity.

MORE DETAILS

Lyft is facing lawsuits from drivers and passengers who say they were sexually assaulted during rides. They're accusing the ride-hailing company of failing to protect them.

MORE DETAILS

The slow pace suggests Lyft is still struggling to bounce back from the pandemic. Lyft and Uber saw demand for their services ravaged by Covid-19, a blow exacerbated by a driver shortage that pushed up fares and wait times for customers.

MORE DETAILS

Second Quarter 2023 Financial Highlights Revenue of $1.021 billion was up 3% year-over-year, reflecting strong growth in rideshare rides, up 18% year-over-year. Net loss of $114.3 million compares with $187.6 million in Q1'23 and $377.2 million in Q2'22.

MORE DETAILS

David Risher - Chief Executive Officer - Lyft | LinkedIn.

MORE DETAILS

Largest shareholders include Fmr Llc, Vanguard Group Inc, FBGRX - Fidelity Blue Chip Growth Fund, BlackRock Inc., VTSMX - Vanguard Total Stock Market Index Fund Investor Shares, Ubs Asset Management Americas Inc, NAESX - Vanguard Small-Cap Index Fund Investor Shares, Two Sigma Investments, Lp, Voloridge Investment ...

MORE DETAILS

First Quarter 2023 Financial Highlights Revenue of $1.0 billion, up 14% year-over-year, and $26 million better than our guidance of $975 million1, with the outperformance reflecting rideshare strength. Net loss of $187.6 million compares with $196.9 million in Q1'22 and $588.1 million in Q4'22.

MORE DETAILS

In terms of the hourly rate, Lyft is generally considered to pay slightly more than Uber. However, there is no set hourly rate for either app since drivers are paid instead on a piece-rate basis. As such, this is important to consider as part of your decision since the hourly rate will likely vary.

MORE DETAILS

He is a professor of economics and has raised more than $4.5 billion in investment capital. The top shareholders of Uber are Dara Khosrowshahi, Tony West, Nelson J. Chai, SB Investment Advisers (UK) Ltd., Morgan Stanley, and FMR LLC. Below, we take a closer look at the top shareholders of Uber.

MORE DETAILS

More than 75 percent of Lyft drivers said they were satisfied with their experience, while less than half of Uber drivers said the same. Lyft is a significantly smaller company, but its drivers made more money.

MORE DETAILS

Finally, a profit As we mentioned above, Uber finally turned an operating profit, reporting $326 million in Q2 compared to an operating loss of $713 million a year earlier. It's taken Uber an incredibly long time and tens of billions of dollars in investment to flip to a profit, but it did manage to pull it off.

MORE DETAILS

Despite the record profit, Uber's $9.2 billion in revenue came short of consensus estimates, while its 14% year-over-year revenue growth was its weakest since Q1 2021. Even after its roughly 100% surge over the past year, Uber stock is still down roughly 20% from its early 2021 peak.

MORE DETAILS

John Zimmer is the co-founder and former president of Lyft, an on-demand transportation company, which he founded with Logan Green in 2012.

MORE DETAILS