Lyft Co-founder Says Company is like a ‘Coiled Spring’

Despite Lyft missing on the active rider metric for the fourth quarter, the company’s co-founder still had optimistic things to say.

For the fourth quarter, the ride hailing company reported a loss that was narrower than expected and sales that topped expectations.

Shares were roaring 10% higher in after-hours trading this past Tuesday after the
results.

Lyft’s co-founder and president John Zimmer is optimistic about where the company is headed after a difficult year with the pandemic.

“I really expect to see a growth inflection in the second quarter that strengthens into the second half of the year,” Zimmer told Yahoo Finance. “I think we really set ourselves up to have a great year to be the recovery stock to own as vaccine distribution ramps up.”

Zimmer continued, “It’s kind of like we’re a coiled spring. As soon as people get back into the world I really believe this sets us up in a great way for a big year.”

For the fourth quarter, Lyft reported revenue of $569.9 million compared to $561.2 million that was expected. Adjusted EBITDA loss was $150 million compared to the $182.7 million loss that was anticipated. Active riders came in at 12.6 million, below the 13.3 million that was expected. Revenue per active rider however was a beat at $45.40 compared to the $41.99 waited for.

Lyft noted that in the fourth quarter the company was hurt by a resurgence of COVID-19.

“Given the impact of new efficiencies and our lower cost structure, we’re even more confident that we’ll be able to achieve adjusted EBITDA profitability by Q4,” Chief Financial Officer Brian Roberts said on the earnings call. “In fact, based on the improvements we’ve made, there is a chance we can achieve profitability in Q3.”

He added, however, that “pulling in profitability would require a strong summer rebound.”

“We expect demand to rebound over time, and as it does, the groundwork Lyft has put in place during the depths of the pandemic to better position the company for stronger profitability going forward will be a net benefit,” remarked Wedbush analyst Dan Ives ahead of the company’s earnings release.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.