Lyft reports 125% revenue growth over last year
Lyft (LYFT) continues to recover from the pandemic, posting 125% quarterly revenue growth and pre-tax profit. Despite renewed increases in incidence and concerns about the Delta strain, “July was Lyft’s best month since March 2020.”
Shares in American taxi service Lyft (LYFT) rose 0.25% in premarket Wednesday (as of this writing) after the company released second-quarter financial results after closing on Tuesday.
Lyft shares are up 12.7% since the beginning of 2021 and are up more than 90% in the past 12 months. By comparison, the S&P 500 is up 17.8% this year and about 33% over the past 52 weeks. Below is a chart of Lyft shares since the company’s IPO on March 29, 2019.
Overall, investors are seeing a significant recovery in Lyft’s business starting in November 2020 – the chart shows a spike in growth following the crisis-driven decline during the pandemic.
Business Lyft Inc. includes online taxi service and food delivery, car, motorbike, and bicycle rentals.
Record growth and first profit for Lyft
Lyft posted a record 125% revenue growth to $ 765 million in the second quarter ended June 30, beating the Wall Street analyst average of $ 696.9 million. Lyft’s quarterly revenue and earnings statistics for the last 2.5 years are available here.
The number of monthly active users rose to 17.14 million from the expected 15.45 million. 3.6 million more than in the first quarter, but still less than the level of passenger traffic before the pandemic. Lyft had 21.2 million loyal customers in the first quarter of 2020.
Lyft still has a net loss (after tax), but for the first time reported having achieved an adjusted EBITDA margin based on earnings before interest, taxes, depreciation, and amortization. The amount of profit (EBITDA) was $ 23.8 million.
A quarter earlier than the company had planned, and represents an essential milestone for Lyft. Some analysts considered the business model of Lyft and its larger rival Uber (UBER) to be unprofitable.
Loss per share fell to $ 0.05, better than the average forecast of $ 0.24 per share expected by analysts.
Lyft’s revenue per customer dropped to $ 44.63 from an expected $ 45.36. The company pointed to a reduction in travel fares.
Lyft rides are on the rise as people have more freedom of movement following quarantine measures in U.S. cities. Many taxi orders are for trips to the airport, entertainment venues, cafes, and restaurants that have reopened.
Lyft’s growth also has by addressing most of its driver shortages, as the company reported in last quarter’s report.
Like Uber, Lyft’s driver shortage problems stem from substantial cuts in 2020 and high U.S. unemployment benefits that are dampening Americans’ willingness to go to work. In addition, employees at services such as Lyft Taxis contract worker status rather than full-time employment.
However, CFO Brian Roberts said in the report that the company is seeing a sharp increase in driver hiring in those U.S. states that have already stopped paying higher unemployment benefits.
The company expects ride prices to be lower, but Lyft will continue to invest in incentives to attract and retain drivers.
Lyft forecast for the third-quarter – growth
Lyft said it expects third-quarter revenue growth in the $ 850 to $ 860 million range, but analysts, on average, were expecting a more prominent figure of $ 869.1 million.
James Cordwell, an analyst at Atlantic Equities, believes that if Lyft made a profit amid rising COVID-19 cases and uncertainty, and while active customers are still 20% below pre-pandemic levels, he says Lyft still has growth potential.
Lyft continues to grow its business.
During the report, John Zimmer, co-founder and president of Lyft talked about a deal with Ford Motor (F) and Argo AI last month as part of a self-driving taxi service that will offer riders to Miami this year and Austin early next year.
