Lyft's Co-founders John Zimmer and Logan Green
Don’t expect profits anytime soon, but Lyft is hoping losses will drop after this year. In its first quarterly results after its IPO, Lyft reported a $1.138 billion loss for the first quarter, of which an $894 million chunk went to stock-based compensation and payroll expenses.
“We anticipate that 2019 will be our peak loss year,” said Brian Roberts, Lyft’s chief financial officer, said in a call with analysts and journalists.
Revenues reached $776 million in the first quarter, up nearly 95% from the year-ago quarter, and beating analyst estimates of $739 million, compiled by Refinitiv. The number of active riders jumped to 20 million, up 46%, helped by publicity around the company’s IPO, Roberts says.
Separately, Alphabet Inc.’s Waymo, which has a tentative self-driving tech partnership with Lyft and is also a major stockholder in Uber, said it plans to add ten of its autonomous Pacifica Hybrid minivans to Lyft’s network in the metro Phoenix area, where it launched its branded Waymo One ride service last year. Previously, Lyft has operated self-driving pilot programs in Las Vegas with autonomous tech supplier Aptiv.
The stock market seemed unsure of what to make of Lyft's earnings: It dropped 2% after hours before going green again and then sliding again. Still, not the boost Lyft may have been hoping for following a tepid reaction to its IPO.
Analysts saw Lyft's earnings as a "prove me" movement ahead of Uber's anticipated public debut on Friday. "Let’s not sugarcoat it, Lyft’s stock has been a head-scratching train wreck since the IPO as the stock is still down ~15% since coming out of the box with other key tech IPOs (Pinterest, Zoom) showing a very strong performance thus far in the eyes of tech investors," wrote Wedbush analysts ahead of Lyft's earnings.
Lyft may have passed its first earnings hurdle, but Uber's IPO around the corner will test its stock performance—and investor appetite for unprofitable ride-hailing companies—once again.
Contributing: Alan Ohnsman in Los Angeles.