Lyft Inc. has outperformed expectations in its first-quarter results and financial projections, showcasing its capacity to retain and attract riders in the US and Canada.
The company announced a 21% surge in gross bookings, totaling $3.69 billion for the initial three months of the year, exceeding analysts’ forecasts of $3.59 billion. Active rider numbers also surpassed expectations, reaching 21.9 million and experiencing the most rapid growth since 2022. Lyft attributed this growth to enhancements in rider retention, an uptick in new riders, and targeted efforts in Canadian markets.
In the current quarter, Lyft anticipates gross bookings to fall within the range of $4 billion to $4.1 billion, slightly lower than Wall Street's expectation of $4.02 billion.
CEO David Risher remarked, “We are executing effectively and introducing much-needed innovation to the market. This is why drivers and riders are increasingly choosing Lyft.”
Following the announcement, Lyft's shares surged by as much as 14% in after-hours trading, marking a more than 90% increase over the past 12 months.
Despite facing challenges in competing with Uber Technologies Inc., Lyft has seen accelerated revenue growth and reduced net losses since Risher assumed the role of CEO. This improvement is attributed to cost-cutting measures, heightened customer satisfaction, and strategies to entice riders with competitive pricing. Lyft has also focused on driver incentives, guaranteeing a percentage of take-home earnings and launching programs such as matching women riders with women drivers.
Lyft has expanded its presence in five of Canada’s largest cities, doubling rides and more than doubling new riders and driver hours in the first quarter. The company reported positive free cash flow for the second consecutive quarter and significantly narrowed its net losses, falling well below analysts’ expectations. Additionally, Lyft revised its full-year expectation for converting adjusted earnings before interest, taxes, depreciation, and amortization to free cash flow, aiming to convert at least 70%, up from the previously announced 50%.