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Transportation

Lyft Projects 2019 Will Be Its 'Peak Loss Year'

By Michael B. Baker / May 08, 2019 / Contact Reporter
Business Travel News on X

Lyft nearly doubled its revenue year over year during the first quarter, although it reported a loss on par with its performance last year. In an earnings call on Tuesday, Lyft's first since going public, the ridehailing provider reported $776 million in revenue for the first quarter, up from $397 million in the first quarter of 2018. Active riders on the Lyft platform rose 46 percent to 20.5 million, and revenue per active rider increased 34 percent year over year for the quarter to $37.86.

President and co-founder John Zimmer said revenue from its corporate partners is "growing faster than Lyft's overall business," citing expense data from Certify that shows a growing share for Lyft among corporate travelers.

However, Lyft's earnings debut also came with a quarterly loss of $1.1 billion. A large portion of that, $894 million, was related to stock-based compensation and payroll taxes largely connected with its IPO. Excluding that, the first-quarter loss was $211.5 million, compared with a $228.4 million loss in the first quarter of 2018. For this full year, Lyft projects EBITDA will be a loss between $1.15 billion and $1.175 billion.

CFO Brian Roberts said 2019 will be Lyft's "peak loss year as we move toward profitability" and that current losses represent a time when the company is at "Day 1 of a $1.2 trillion market opportunity." Costs more than doubled year over year during the quarter, including a jump in R&D spending from $63.2 million in the first quarter of 2018 to $631 million in the first quarter of 2019. While ridehailing remains the main driver of profit and loss for the company, it is investing in other areas like autonomous vehicles and scooter- and bike-sharing, Roberts said.

One such investment is a newly announced partnership with Alphabet's autonomous-driving subsidiary Waymo. Lyft is adding a handful of Waymo's self-driving vehicles, which will be operated with a safety driver in the vehicle, to its platform in Phoenix and plans to have about 10 such vehicles on the platform by the end of the third quarter.

As such, the company sees itself "in the very early stages of an enormous secular shift from personal car ownership to transportation-as-a-service," according to co-founder and CEO Logan Green.

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