Wednesday 4 August 2021 9:19 am

Lyft announce first profit figure three months ahead of target

Californian Uber-challenger Lyft saw shares rise six per cent on Tuesday after announcing the first time quarterly profit in the firm’s nine-year history.

Three months ahead of target, the company said EBITDA profit hit $23.8m (£17.2m) in the most recent quarter as rider numbers rebound after the pandemic.

Lyft has branched out in tandem with its main competitors, now offering customers the chance to hire motorised scooters, bicycles, and receive food deliveries via the app.

The business said it expected to remain profitable but that a driver shortage would represent a short-term challenge in the post-pandemic reopening.

Logan Green, Lyft co-founder and chief executive officer, said, “we had a great quarter. We beat our outlook across every metric and we have growing momentum. Since our inception, we’ve worked hard to defy the odds with a deep belief in our mission.”

Lyft president John Zimmer, in an interview with Reuters, also said, “our business model has never been more healthy.”

A spike in US Covid-19 cases, predominantly due to the Delta variant’s arrival in the States, has caused driver issues however.

As the variant spreads across the US driver shortages are threatening the company’s profit.

Despite the concerns the company’s platform grew over the three months ending June 30.

Due to the pandemic ride-hailing businesses such as Lyft and Uber had to ramp up driver supply as more people return to normality and demand in vehicles increased. However, they initially struggled to gain more drivers.

Zimmer said the company had welcomed 50 per cent more new drivers in the three months ending June 30 compared to the first three ending March 31. Driver earnings also increased and could remain higher than pre-pandemic levels.