In their own call with investors on Tuesday night, Lyft executives adhered to a prediction made a year ago: that it would reach profitability on an EBITDA basis by the end of 2021. Lyft's result exceeded Wall Street expectations, but its shares fell 10 percent on Wednesday.
Reported better-than-expected Q4 results: adjusted EPS of $1.23 on sales of $772 million.
Despite beating analyst predictions in its fourth-quarter earnings Monday, shares in Lyft Inc. dropped in after-hours trading after the company failed to move up its profitability timeline as rival Uber Technologies Inc. did February 6.
Sticking to declines, Lyft's net loss (a metric which comprises all prices ) was 356.0 million in the quarter, a radically worse outcome than its own $ 248.9 million net loss in Q4 2018.
On Monday, Lyft announced an expansion into the entire City of Vancouver, Richmond, New Westminster and North Surrey. However, Lyft expects to become profitable by the fourth quarter of 2021, which is one year later than Uber. But Lyft operates only in the USA and Canada, while Uber's footprint extends across the globe.
Analysts and investors were also closely watching the company's report for user growth numbers, and the company said it grew active riders to more than 22.9 million, an increase of 23% year-over-year.
Spinning to adjusted EBITDA, a heavily corrected earnings metric, Lyft dropped $130.7 million in Q4 2019, an improvement on its Q4 2018 adjusted EBITDA loss of $251.1 million. Lyft is trailing Uber in market capitalization and overall market share as the number 2 United States ride hailing player. Excluding one-time items, the company lost 41 cents per share. Share-based payments at Uber in all of 2019 amounted to almost $4.6 billion, or roughly a third of revenue.
"Fiscal 2019 was an exceptional year across the board". This is only a week after Lyft's largest competitor, Uber Technologies, Inc.
The San Francisco-based companies have taken different approaches to hit profit.
Lyft continues to bleed money, though at lower levels.
Lyft in October said a growing number of customers were paying full price, with discounts and promotional incentives decreasing.
For 2020, Lyft said it expects to generate $4.58 billion to $4.65 billion in revenue and projected that it will narrow its losses before interest, taxes and other expenses to US$450 million to US$490 million, from US$678.9 million in 2019.
But Uber Chief Executive Dara Khosrowshahi told investors during an earnings call on Thursday that Lyft over the past month or so had been more aggressive in giving out discounts to attract customers.
Lyft also said a restructuring of its insurance policies would improve contribution margins, but did not elaborate.