Ubering to the polling place… Investors didn’t cast a vote of confidence for Lyft yesterday. Shares of Uber’s smaller, pinker rival tumbled 23% as investors reacted to its quarterly earnings. Lyft beat on profit expectations, but fell slightly short of Wall Street’s revenue forecast.
- Lyft’s #s were solid, but investors expected a big beat based on Uber’s results last week — and we all know how important expectations are with investing.
- Pricing up: Lyft’s revenue rose 22% from last year, to a record $1B, thanks to record prices. Revenue per rider surged to $52 as long trips and airport rides rebounded.
- Cutting down: Last week Lyft announced it was laying off 13% of its employees (700 people) as its net loss for the quarter quadrupled to $422M.
A tale of two strategies… Lyft’s mission is to “improve people’s lives with the world’s best transportation,” but Uber has diversified beyond urban mobility. While ride-hail majorly rebounded, Uber’s delivery business made up half of its gross bookings last quarter (think: Uber Eats). Its Freight biz, which connects semitruck drivers with high-volume loads, quadrupled its revenue to $1.7B. That means that Uber’s Freight division alone makes more money than Lyft as a whole.
Your worst enemy is your best comparison… In the ride-hail duopoly, Uber and Lyft constantly compete as riders toggle between the two apps. Even though they’re two different companies, Lyft tanked as investors compared it to Uber, whose results had raised expectations for its rival. In industries with a few dominant players, the biggest competitors can’t escape these comparisons. The next frontier Uber and Lyft will be competing on: ads.