Lyft Forecasts Profit by End of 2021, Sending Shares Surging
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Ride-hailing company Lyft Inc. is expected to turn a profit by the end of 2021, a year earlier than analysts had expected, company executives said. The comments sent the stock surging as much as 9% on Oct. 22.
Lyft will hit that milestone because it is focused on profitable growth, rather than scale at all costs, the founders said at a Wall Street Journal technology conference in Laguna Beach, Calif. Lyft and Uber Technologies Inc. have been cutting back on subsidies for riders and drivers that had been racking up costs.
鈥淲e鈥檝e never laid out our path to profitability, and we know that鈥檚 a question on a lot of investors鈥 minds,鈥 said Logan Green, Lytft鈥檚 CEO and co-founder. 鈥淲e鈥檙e going to be profitable on an adjusted [earnings before interest, taxes, depreciation and amortization] basis a year before analysts expect us to. We鈥檙e going to hit this target in Q4 2021.鈥
The comments also gave a boost to Uber鈥檚 stock, which was up about 4% at 1 p.m. in New York.
Lyft鈥檚 co-founders downplayed other challenges to the company, including the recent gig worker legislation in California and lawsuits by women against the company who say they were harassed or assaulted by drivers.
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