Lyft reveals it doubled revenue to $2.2B in 2018 as it files to go public
Release of financial details puts it on track to tap markets ahead of Uber, as losses grow
Ride-hailing giant Lyft released financial details in a federal filing before it begins selling its stock to the public, giving investors the first chance to buy into the ride-hailing phenomenon.
The company showed impressive growth, with $2.2 billion US in revenue last year — more than double its $1.1 billion in revenue in 2017. Revenue had skyrocketed more than 200 per cent in 2017 compared to 2016, when the company brought in $343.3 million.
But Lyft is still losing money, and the losses are growing. The company lost $911.33 million last year, about $223 million more than in 2017. Its cash balance also is shrinking. Lyft had $517,690 in cash and equivalents at the end of last year, about half of what it had at the end of 2017.
IPO could beat Uber
Lyft has been in a race with Uber to be first to offer its stock to the public, and has positioned itself as the affable alternative to its larger rival as Uber struggled with public relations setbacks. Uber expects to file its own initial offering later this year.
Together, the two could raise billions of dollars to fuel their expansions and give investors an opportunity to see how the companies plan to become profitable.
Lyft's filing on Friday says that CEO Logan Green and President John Zimmer, both co-founders, will keep significant control of the company after it goes public. Although it doesn't say what percentage of votes they would control, the filing says they "will be able to significantly influence any action requiring the approval of our stockholders," including the election of board members, a merger, asset sales or other major corporate transactions.
Lyft had 30.7 million riders in more than 300 cities in 2018, and has given more than one billion rides since its inception in 2012, according to the filing.
Bookings rising dramatically
Bookings — the amount of money spent by customers — are rising dramatically, which Lyft will try to emphasize for investors. The company had just over $8 billion in bookings last year, 76 per cent more than in 2017 and more than four times the number from 2016.
"We believe this is a key indicator of the utility of transportation solutions provided through our multi-modal platform, as well as the scale and growth in our business," the company said in the filing.
By being the first company in ride-hailing category to go public, Lyft is likely to attract institutional investors who want to get in on the sector, said Rohit Kulkarni, senior vice-president of research at Forge.
It also gives Lyft the chance to define what metrics the industry will be measured on, because it can choose which details to disclose, such as the number of rides or drivers, or whether it will break down revenues by geography or product, putting pressure on competitors to reveal the same information, he said.
Lyft was valued at just over $15 billion last year. In addition to ride-hailing, it offers shared car, bike and scooter rides. The company purchased Motivate, the largest bike-sharing company in the country, in November.
Uber's PR problems
Lyft was increasing its share of the market in recent years while Uber was dogged by reports that drivers accosted passengers and that the company allowed rampant sexual harassment — revelations that ultimately led its co-founder Travis Kalanick to resign. Uber has been working to repair its image under CEO Dara Khosrowshahi.
Lyft's drivers have earned a total of $10 billion since 2012, according to Friday's filing, and 91 per cent of them drive fewer than 20 hours per week. The company allowed customers to tip drivers earlier than Uber, building into its brand the sense that it treats drivers better than its main competitor.
In its early days, Lyft drivers decorated the grilles of their cars with pink moustaches to friendly vibe, and its drivers now display a logo in the windshield with a pink background.