Lyft said it sees current quarter revenues growing at the lower end of its previous range of between 11% and 15% on a sequential basis, as well as an adjusted loss of "better than $185 million" compared to its previous estimate of $200 million at the mid-point and $190 million at the higher end. It also sees profit margin expansion in the fourth quarter, which it expects to continue over the 2021 financial year.
Last month, Lyft noted that riders will likely increase by between 800,000 and 1 million this quarter, but added the caveat that this would only happen if there were no further COVID lockdowns in key markets.
Lyft "attributes the improvement in its Adjusted EBITDA outlook for the fourth quarter of 2020 to Contribution Margin, which is expected to be at the top end of the previously provided range, and to strong cost controls given the unpredictable market environment," the company said in filing with the Securities and Exchange Commission. "The Company also now anticipates further Contribution Margin expansion in 2021 on a sequential basis versus the fourth quarter of 2020 even before a full recovery."
Lyft shares were marked 4.3% higher in early trading Wednesday to change hands at $41.30 each, a move that would trim the stock's six-month gain to around 30%.
Lyft posted a loss of $1.46 per share for the three months ending in September, a narrower tally than over the same period last year but worse than the Street consensus forecast of 91 cents per share as group revenues fell 48% to $500 million.
COVID-triggered restrictions on businesses, restaurants and public events in California, the group's biggest market, meant active riders for the quarter fell 44% to 12.5 million, but both that tally, as well as the $500 million in total revenue, were sequentially stronger than the previous quarter, and Lyft said cost cuts and budgeting should bring the company to profit by the end of next year.
Lyft also said it's planning to add food delivery options to its platform, albeit at a smaller scale than Uber telling investors on a conference call it was in the 'early days' of a pilot program.