Ride-hailing platform Lyft Inc. said… On Tuesday it said it expects two key measures of demand to come in above Wall Street forecasts for next year, and that it expects to achieve positive free cash flow for the first time during that period.
The company made these forecasts after making significant headcount cuts over the past two years, but also with more people using Lyft.
Often during the holiday quarter last year as travel spiked and workers sought service on their commute. But the benefits of a broader recovery in the ride-sharing industry have also flowed to its larger rival, Uber Technologies Inc.
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She said she expects percentage growth in trips in the mid-teens this year. That was better than FactSet's forecast of about 11%.
It also expects an increase in gross bookings – or what customers charge for rides, scooter rentals and services such as subscriptions that offer additional perks – which has slightly outpaced growth in rides. FactSet called for bookings growth of about 12%.
In the first quarter, Lyft expected total bookings to be about $3.5 billion to $3.6 billion. That was higher than FactSet's forecast of $3.46 billion.
Shares rose 4.7% after hours on Tuesday.
Commute trips jumped 27% during the quarter, CEO David Risher said in an interview. He also said the sector that handles these commuting trips — for employees at companies like Starbucks Corp. and SBUX,
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– It represents more than 20% of its flights annually in general.
This part can help employees get to and from work outside working hours – when public transportation is not available – or when parking spaces are tight. Rescher refused to reveal the size he believes this part could reach. But he noted that Lyft recently reorganized to focus more on its larger corporate customers.
“This is definitely an area where we are redoubling our efforts, and we already are,” he said.
Lyft's quarterly financials came after its larger rival, Uber Technologies Inc, reported fourth-quarter results last week that beat expectations. Analysts praised the platform's profitability, as well as growth in the number of subscribers who pay for additional features and in its advertising business, which allows third-party companies to pay for ads that appear in the Uber app.
However, Bank of America analysts noted Tuesday that Uber, during its earnings call, said it hopes to “keep a lid” on prices — which could lead to increased competition with Lyft — and warned of rising costs for the insurance it provides to drivers.
Lyft was similarly struggling with high insurance costs, Risher said. But he said the company had not changed its pricing strategy in response to any moves from Uber.
For the fourth quarter, Lyft reported a net loss of $26.3 million, or 7 cents per share, much smaller than the loss of $588.1 million, or 1.61 cents per share, in the same quarter a year earlier.
Lyft's adjusted earnings per share were 18 cents, above the FactSet forecast of 8 cents. Sales rose 4% year over year to $1.22 billion, roughly in line with estimates of $1.22 billion. Total bookings rose 17% to $3.72 billion, beating expectations of $3.69 billion.
Lyft shares are up 12.4% over the past 12 months. By comparison, the S&P 500 SPX rose 19.1% during that period.
