Lyft beats third-quarter estimates, bookings underperform rival Uber

November 8, 2023 4:09 PM EST

An empty Lyft pick-up area is shown as rideshare drivers hold a rally as part of a statewide day of action to demand that ride-hailing companies Uber and Lyft follow California law and grant drivers "basic employee rights'', in Los Angeles, California, U.

By Akash Sriram

(Reuters) -Lyft reported third-quarter revenue and profit surpassing estimates on Wednesday, but gross bookings growth was lower than larger rival Uber's ride-hailing business.

Gross bookings, which is a metric Lyft started disclosing in the third quarter measuring total transaction value on its platform, grew 15% from a year earlier, compared with a 31% jump in Uber's mobility business.

Shares of Lyft fell nearly 4% in extended trading.

While analysts and investors believe Lyft will maintain its position as the second-largest ride-hailing platform, they said it is more susceptible to economic uncertainty.

"Softening macro conditions will likely impact Lyft more than its larger peer, Uber," said Angelo Zino, senior equity analyst at CFRA Research.

Lyft commands 29% of the ride-hailing market as of September, slightly higher than the 27% market share it had at the start of the year, according to YipitData, after it said it will price its rides competitively rival Uber.

"While operating from a more efficient cost structure is certainly part of our formula, it is by no means the only part of the margin expansion equation," Chief Financial Officer Erin Brewer told Reuters.

Brewer added that an improved mix of airport rides, scheduled rides and priority pickups also helped margin expansion.

Lyft forecast current-quarter adjusted core profit, a key profitability metric closely watched by investors, of $50 million-$60 million, higher than expectations of $48.8 million, according to LSEG data.

Adjusted profit in the third quarter stood at 24 cents per share, compared with estimates of 13 cents.

Lower prices helped Lyft serve 22.4 million active riders, which jumped 10% compared with a year earlier.

Lyft said it expects fourth-quarter revenue to grow in mid-single-digits sequentially, compared with market expectation of 4.6% growth, according to Reuters calculations.

Revenue grew 10% to $1.16 billion in the quarter ended Sept. 30, surpassing analysts' average estimate of $1.14 billion.

Lyft's adjusted core earnings of $92 million in the third quarter topped expectations of $82.6 million.

(Reporting by Akash Sriram in Bengaluru; Editing by Krishna Chandra Eluri)

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