Lyft has increased revenues from the previous quarter and expects further recovery in demand for its taxi service. Lyft provided a forecast for the next quarter and reiterated its promise to be profitable in the third quarter.
Lyft (LYFT) shares rose 6.8% on Tuesday after the close of trading, in response to the company’s positive financial report and outlook.
Thanks to the massive vaccination of more than half of the US population against COVID-19, the lifting of many quarantine restrictions and the resumption of air travel, the demand for taxi rides grew in the first quarter of 2021.
Lyft’s biggest competitor, Uber (UBER), said last month that March 2021 was its best month ever. Uber will report its first quarter financial results today after the close of trading.
For the first quarter, Lyft reported lower losses per share than analysts expected: – $ 0.35 versus – $ 0.53. This is more than the $ 0.32 loss in the first quarter of 2020, but well below the previous three quarters.
The company was able to cut losses by cutting costs, and Lyft executives noted a gradual recovery in travel demand, announcing in mid-March that it expected positive weekly passenger growth every subsequent week until the end of the year, unless the pandemic worsened significantly.
Lyft’s revenues were down 36% year-on-year, but up 7% quarter-on-quarter to $ 609 million versus an analyst estimate of $ 558.7 million. Lyft’s quarterly revenue and earnings statistics for the last 2 years are available here.
The average number of active Lyft users in the first quarter grew more than 7% compared to the last three months of 2020, but the number is still about 36% lower than last year.
The number of active Lyft users at the end of March was 13.49 million versus 12.8 million expected by analysts.
Revenue per active user rose to $ 45.13 from $ 44.50 according to forecasts.
The company’s management confirmed that it expects to make a profit in the third quarter, at the same time the $ 550 million deal to sell the self-driving car division Lyft Autonomous to Toyota subsidiary Woven Planet should be closed.
The company expects the problems with the demand for travel and the shortage of drivers to continue in the second quarter and ease in the third.
Lyft said it will invest in hiring more drivers after cutting contractors amid the pandemic. Uber said last month it would spend $ 250 million on driver acquisition.
Lyft predicts second-quarter revenues to range from $ 680 million to $ 700 million, up 12-15% from the previous quarter and double last year’s value, as revenues fell sharply in the second quarter of 2020. for the outbreak of coronavirus in the United States.
Shares in Lyft and Uber, as well as food delivery companies DoorDash (DASH) and Grubhub (GRUB), fell sharply last week amid reports that a senior official from President Joe Biden said most workers in the United States should be classified as “wage earners. workers who deserve appropriate benefits. “
Lyft executives, commenting on the quarterly report, downplayed the risks of retraining workers, pointing to a positive precedent for Lyft employees in California who work as contractors but receive some benefits and social benefits.
Lyft shares are up 14.4% year-to-date.