Lyft credits boom in travel and leisure for strong 2023 growth – GWC Mag

Dive Brief:

• Lyft provided 709 million rides in 2023 across ride-hailing, bikeshare and scooter-share services, an 18% increase year over year, it reported Tuesday.
• The company saw 8% revenue growth in 2023 over the previous year on a 14% increase in gross bookings. It shaved its net loss from $1.6 billion in 2022 to $340.3 million last year, it stated in its 2023 fiscal year earnings report.
• “In 2024, we expect Lyft to generate positive free cash flow on a full-year basis for the first time in our company’s history,” Lyft CEO David Risher said on the company’s Feb. 13 earnings call. “It’s a huge milestone for us.”

Dive Insight:

Lyft attributed its strong results to the booming economy in travel and leisure activities. “What we’ve seen over the past three quarters is people are getting out more and connecting with the world around them,” Lyft Chief Financial Officer Erin Brewer said on the call. “They’re commuting, traveling, heading to events and gathering with family and friends.” Brewer added the company expects these trends will continue.

But the good financial news at both Lyft and Uber, which also reported solid growth in 2023, comes as some ride-hailing drivers are joining a strike today in 10 communities across the U.S. During the strike, organized by Justice for App Workers, a coalition of ride-sharing drivers and delivery workers, drivers will refuse to provide rides to or from airports in Austin, Texas; Chicago; Hartford, Connecticut; Miami; Newark, New Jersey; Orlando, Florida; Philadelphia; Pittsburgh; Tampa, Florida; and Rhode Island. The organization says on its website that it is fighting for fair wages, safety and other job-related demands.

On Feb. 6, Lyft announced a guarantee that drivers will earn at least 70% of rider fares going forward, exclusive of external fees such as local taxes and government-mandated insurance. “Most of the drivers earn more than that already, but there are instances where that’s not the case,” Risher said on the earnings call. Brewer noted that drivers are getting about 88% of fares now, on average.

While Lyft doesn’t break out the volume of rides separately of its ride-hailing, bike and scooter businesses, it operates bike-sharing programs in seven U.S. communities — including Chicago, New York City and the greater Washington, D.C., area — as well as scooter rentals in Chicago, Denver and the nation’s capital.

The company invested in upgrading its fleet of bikes and scooters last year, Brewer said, which included more e-bikes. “First of all, riders love them,” Brewer said of e-bikes. “Second of all, it allows us to be more efficient,” she said. The company plans to deploy more e-bikes in 2024, she added. 

Looking ahead, Lyft expects total rides to grow by mid-teen percentages in 2024 over 2023.