Lyft Beats Q3 Estimates with Increased Active Ridership and Revenue, Slower Bookings Growth Compared to Uber, Forecasts Higher Adjusted Core Earnings for Q4

Lyft's price-cutting strategy aids in gaining market share in competition against Uber, while forecasting further profitability improvement for Q4, even as investors react variedly to Q3 earnings; recently introduced advertising efforts and targeted features aim to incentivize ridership growth.

• Lyft's aggressive pricing strategy resulted in an increase in active ridership numbers from Q2 to Q3. Lyft recorded 22.4 million active riders in Q3, up from 21.5 million in Q2, increasing overall revenue and maintaining competitiveness against Uber.
• Lyft's gross bookings growth was slower than Uber's, with a QoQ increase of 3%, compared to Uber's 7%. Despite this, Lyft's revenue per active rider increased to $51.67, up from $47.51 in the previous quarter.
• Lyft's financial performance exceeded expectations in Q3, reporting a revenue of $1.158 billion, beating Wall Street estimates. Additionally, the company significantly reduced its net loss from $114.3 million in Q2 to $12.1 million in Q3.
• Lyft forecasts higher adjusted EBITDA earnings for Q4, aiming for gross bookings of between $3.6 billion and $3.7 billion and an adjusted EBITDA margin of about 1.4% to 1.6%.
• To boost ridership, Lyft introduced targeted features such as the Women+ Connect feature that allows women and nonbinary drivers to preferentially pick up women riders, and also launched an in-app advertising unit. The company, however, faces challenges including a $10 million fine over an SEC charge, and a wage-theft claim settlement in New York.

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