LYFT shares tanked, down 25% to $23, after reporting ridership and revenue metrics which missed Wall Street forecasts. The company posted first quarter revenue which topped estimates, coming in at $876 million, versus the $846 expected. However, it guided to revenue of $975 million for the second quarter, which was short of the $1.02 billion analyst estimate.
Additionally, active riders were up only 32% year-over-year to 17.8 million while the estimate called for 18 million. The company also missed on the cash on its balance sheet, ending the quarter with a balance of $215 million, versus the $523 million expected by analysts.
On the positive side, the company reported EBITDA of $54.8 million, far exceeding the average expectation of $14.4 million. Revenue per active rider jumped 9% year-over-year to $49.18, which similarly beat the consensus.
Furthermore, the miss on the active riders metric was partially due to the seasonal weakness in bike ridership during the winter months. The company’s CFO also guided towards a much stronger second-half of the year.
Lyft’s strategic decision to focus purely on rideshare also stands in contrast to its main competitor Uber’s decision to incorporate food and grocery delivery into its business model. Uber’s diversification has helped protect the top-line from the effects of the Omicron variant to much greater degree than Lyft.
For example, Lyft’s revenue last year was still 11% shy of its 2019 figure, while Uber’s FY 2021 top-line was 34% higher than the figure recorded in 2019.
As the pandemic becomes an endemic in much of the world, new variants such as Omicron should have a reducing impact on Lyft’s business. The weak second quarter forecast was also exasperated by a dearth of drivers and the sharp increase in gas prices.
Higher fuel prices mean that alternative competitors to rideshare services, such as public transportation, become more attractive. Moreover, a lack of availability of drivers generally means longer wait times for riders, which in-turn results in cancelled trips. Management indicated that this shortage would improve through the course of the year.
Featured CoursesRecent news
IMAX Stock Jumps 15% on Sale Reports: Who’s Buying?
IMAX is considering a sale, sparking speculation about buyers. Shares rose 15% Friday after the Wall Street Journal reported IMAX approached entertainment companies. The process is early and may not end in a deal. Here are the analysts’ top buyer picks and what each could gain with IMAX. Netflix is attracting the most attention as […]
Merck Shares Jump 4.9% on Cancer Trial Win as Keytruda Patent Cliff Looms
Merck wants to show it is not just a one-drug company, and Friday’s clinical trial results gave it a boost. Shares rose 4.9% in premarket trading after a partner drug worked well in advanced lung cancer when used with Merck’s main cancer treatment. At the same time, European regulators moved closer to approving another Keytruda […]
Micron Stock Slips 1% After a Volatile Week for Memory Chip Stocks
Micron shares slipped 1% in early Friday trading after a week of ups and downs. The stock climbed from below $660 to a 4.1% gain on Thursday, but then fell back by Friday morning. This week, the memory chip sector was influenced by remarks from a competitor’s CEO, a narrowly avoided strike at Samsung, and […]
Trade with fewer limits
Day trade with fewer limits at fast speed. Buy stocks and ETFs at low fees.