Lyft’s stock experienced a significant surge of over 25% on Thursday, as the company reported better-than-expected third-quarter results, signaling a rebound in its business. The San Francisco-based ride-hailing giant posted a quarterly loss of just 3 cents per share on revenues of $1.52 billion for the period ending September 30, 2024. Analysts had predicted a similar loss of 3 cents per share, but were expecting lower revenue of $1.44 billion, making the company’s results a major win in the eyes of investors.
Better-Than-Expected Results
The key takeaway from Lyft’s latest earnings report was not only the revenue beat but also the growth in its bookings and rider base. Lyft’s total bookings grew 16% year over year, reaching $4.1 billion for the quarter—outpacing analyst expectations of $4.08 billion. This growth comes as the company continues to capitalize on its reinvestment in technology, services, and innovations aimed at improving the experience for both drivers and riders.
“We delivered one of the strongest quarters in Lyft history,” said Lyft’s CEO David Risher in a statement, reflecting on the company’s positive momentum following a year of significant investments. Lyft has introduced a number of new features in recent months, including expanded driver support, improved ride options, and efforts to streamline the app experience—all of which appear to be resonating with its user base.
Rising Demand and Growing Rider Base
One of the standout figures in Lyft’s earnings was the 9% year-over-year increase in active riders, which rose to 24.4 million in Q3. Total rides also saw a significant jump, increasing by 16% to 217 million rides during the quarter. This growth in ridership indicates a recovering demand for ride-hailing services, which had previously been impacted by various challenges, including the pandemic and increased competition from Uber.
The boost in active riders is particularly encouraging for Lyft, as it suggests that the company is attracting and retaining more users even as the broader market remains competitive. Lyft’s ability to grow both the volume of rides and its rider base highlights the success of its strategy to improve customer satisfaction and expand its service offerings.
Outlook for the Fourth Quarter
Looking ahead, Lyft’s guidance for the fourth quarter of 2024 was also a positive surprise for investors. The company projected Q4 bookings to reach $4.32 billion at the midpoint of its range, slightly ahead of analyst expectations of $4.23 billion. This optimistic forecast reflects the company’s confidence in maintaining its growth trajectory heading into the holiday season, which is typically a peak period for ride-hailing services.
Lyft’s Q4 guidance suggests that the company is well-positioned to continue benefiting from increased consumer spending and travel activity as it navigates a competitive landscape. It also signals that Lyft is on track to meet its long-term goals of returning to profitability, a crucial objective for the company as it faces ongoing pressure to scale effectively in the face of mounting competition from rivals like Uber.
