Lyft Shares Drop Sharply After Q4 Revenue and Ridership Fall Short

Lyft investors hit the brakes Tuesday evening, sending shares down 15% after the company released fourth-quarter figures that failed to meet expectations. The ride-hailing service reported revenue of $1.59 billion, a 3% annual increase but notably below the $1.76 billion analysts had projected.

While total bookings met forecasts, the core metrics of the business showed weakness. Lyft reported 29.2 million active riders in the quarter, missing estimates. The number of rides provided, 243.5 million, also came in lower than anticipated.

The company pointed to recent regulatory changes in California, which lowered insurance costs and allowed for reduced fares, as a factor. In a statement, Lyft suggested this could stimulate demand, but acknowledged the effect would likely build slowly through the second half of the year.

Looking ahead, Lyft's profit guidance for the current quarter aligned closely with analyst predictions. In a separate move, the company's board authorized an additional $1 billion to repurchase its own stock, a signal of confidence in its long-term financial health even as short-term results disappoint the market.

Source: CNBC