Lyft shares tumble 20% and will open at historic lows after earnings report 📉

Lyft (LYFT.US) disappointed analysts with the release of weaker third-quarter results and a loss to rival Uber:

Revenues: $1.05 billion and (22% increase vs. Q3 2021)

Earnings per share (EPS): $0.10 vs. $0.07 forecast according to FactSet

EBITDA: $66 million vs. $62 million forecasts according to FactSet

Net loss: $422.2 million vs. $99.7 million in Q3 2021

Adjusted net income: $36.7 million vs. $46.4 mlb in Q2 and $17.8 million in Q3 2021

Number of active couriers: 20.3 million (7% growth y/y and 2% growth k/k) vs. 21.3 million forecasts

Revenue per supplier: $51.88 (14% y/y growth and 4% k/k growth)

Q4 2022 revenue forecast: Between $1.145 billion and $1.165 billion vs. $1.159 billion forecasts. 

EBITDA for Q4 2022: Between $80 million to $100 million vs. $85 million forecasts

• Uber (UBER.US) reported surprisingly successful financial results that week, beating expectations in both revenue and earnings per share. Lyft's weaker results may indicate that the company is definitely losing ground to Uber. Lyft's Q2 EBITDA was more than $79 million, definitely beating forecasts of $10 million to $20 million. The company was unable to maintain such momentum in the current quarter and only slightly beat expectations;
• Lyft admitted that it lost about 1% market share in the quarter to Uber. The company argued this was due to Uber's more aggressive incentives for drivers and suppliers. The company noted that the incentive programs have ended and the company is focused on regaining lost market share. Significantly, Uber was able to run 'costly' rewards policies for employees and beat analysts' expectations, Lyft failed to do so this quarter despite slowing 'aggressive' growth;
• The company noted that, statistically, October was the strongest month in Q4, and it was October that saw a 6% increase in rides compared to September. November and December, however, may prove to be slower. Lyft expects Q4 results to be burdened by rising insurance costs; the company is passing these charges on to drivers in the form of a new fee. The price of insurance will be about $0.5 per ride. Lyft is looking to save $350 million a year in the future by reducing its workforce, operating costs and office space.

The company maintained its optimistic forecast for 2024 and expects EBITDA of $1 billion and free cash flow of at least $700 million.

Lyft (LYFT.US) shares, W1 interval. Pre-opening trading indicates an opening near $11,5, at all time lows. In addition to the mixed results, the company was weighed down primarily by a picture that speaks in favor of Uber, which with its latest report confirmed that it is doing far better in an economic slowdown environment. Source: xStation5