February 11, 2020 / 9:07 PM / 12 days ago

Lyft tops $1 billion quarterly revenue, forecasts slower growth in 2020

Feb 11 (Reuters) - Lyft Inc on Tuesday reported record quarterly revenue of more than $1 billion, but the ride-hailing company forecast slower growth in the new year as ridership growth stagnated in the second half of 2019.

The company did not change its target to achieve profitability on an adjusted basis by the end of 2021 despite its larger rival Uber Technologies Inc last week moving forward by a year its profitability target.

Lyft reported revenue of $1.02 billion in the fourth quarter, ahead of analysts who expected $984 million in quarterly revenue, according to IBES data from Refinitiv.

For now, the company continues to make losses, reporting an adjusted net loss of $121 million.

Lyft operates only in the United States and some Canadian cities. Its active rider customer base in the fourth quarter grew to 22.9 million from 22.3 million the previous quarter. That compares with Uber’s global 111 million active platform users in the same period.

While Lyft’s ridership grew by more than 6% in the first half of 2019, growth in the second half slowed to around 2.5%.

Uber originally echoed Lyft in saying it would be profitable on an adjusted EBITDA basis by the end of 2021. But the company last week moved that target forward by a year, now promising investors it would be profitable on that metric in the fourth quarter of 2020.

The adjusted EBITDA metric at both companies excludes expenses for stock-based compensation and other items. Share-based payments at Uber in all of 2019 amounted to nearly $4.6 billion, or roughly a third of revenue.

Lyft’s stock-based compensation came in at $1.6 billion for all of 2019, or 44% of full-year revenue.

Both companies went public last year, Lyft in March, Uber in May, with many early employees and investors selling their shares.

Uber and Lyft, both based in San Francisco, are pursuing different roads in search of profitability, with Uber pouring money into side businesses which have so far lost money and Lyft remaining focused solely on moving people around.

Lyft in January cut 2% of its workforce in its sales and marketing department to achieve its profitability target, but said it plans to hire more people this year.

The company is still spending heavily, with total costs in 2019 growing to $6.3 billion.

Uber and Lyft have historically relied on heavy subsidies to attract riders.

Lyft in October said a growing number of customers were paying full price, with discounts and promotional incentives decreasing.

But Uber Chief Executive Dara Khosrowshahi told investors during an earnings call on Thursday that Lyft over the past month or so had been more aggressive in giving out discounts to attract customers. (Reporting by Tina Bellon in New York and Akanksha Rana in Bangalore Editing by Matthew Lewis)

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