US News
Lyft Revenue Rises by 23 Percent; Goes Beyond Expectations
Ridesharing company Lyft, Inc. surprised investors with higher-than-expected revenue, as reported by Fox Business. Shares in Lyft rose over 16 percent in after-hours trading. On the other hand, shares of its rival Uber Technologies Inc rose by 8 percent.
The results from the first quarter show the impact of stay-at-home orders in an effort to limit the spread of the coronavirus.
On Wednesday, Lyft said its first-quarter revenue rose by 23 percent to $955.7 million from the previous year. This is ahead of an $884.7 million estimate by Refinitiv.
Lyft only operates in the U.S. and some parts of Canada, unlike Uber that operates in various countries. Also, while Lyft has been focused on providing transportation, Uber “might be able to recuperate some lost ride-hailing revenue through its food delivery business,” reported Fox Business.
Lyft revenue surprises with 23% rise, 'on path to profitability' despite coronavirus https://t.co/4m4V9yJuxJ pic.twitter.com/MQOgUsxcv4
— Reuters (@Reuters) May 6, 2020
U.S. customers provide the majority of revenue to both companies. Many expect the most detrimental effects for the ride-hailing industry to come in the second quarter of 2020.
According to Lyft Chief Executive Logan Green, the company made preparations to weather the crisis.
“We are responding to the pandemic with an aggressive cost reduction plan that will give us an even leaner expense structure and allow us to emerge stronger,” Green said.
Fox Business reported that the company said it had “$2.7 billion of unrestricted cash and said it would remove some $300 million in expenses by the end of the year.”
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