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Lyft Turns Profitable Ahead Of Schedule
Delivery and ride hailing company Lyft (NASDAQ:LYFT) delivered its first profit during the second quarter, a milestone for a company that had accumulated mounting losses since its founding.
Lyft was not expected to turn profitable until the third quarter of this year. However, Lyft's adjusted profit for the second quarter was $23.8 million U.S., helped by surging demand for its ride-hailing services and deep cost cuts the company made over the past year.
The company's profit beat analysts' estimates that the company would lose $40.2 million U.S. during the quarter.
In a call with investors, executives said the company would continue to pay incentives to entice drivers to return to the platform in the third quarter and beyond to meet rising demand. The company has grappled with a driver shortage in recent months.
Lyft also raised its forward guidance, saying it expects to turn a profit for the full year of 2021, and that the company would make from $25 million U.S. to $35 million U.S. in the third quarter. That's higher than analyst estimates of $11.3 million U.S.
The San Francisco-based ride-hailing company brought in $765 million U.S. in revenue for the quarter, beating the $700.7-million U.S. average analyst estimate. Revenue was up 26% from the previous quarter.
Lyft reported 17.1 million active riders, more than the 15.4 million analysts predicted. The revenue per active rider was $44.63 U.S., compared to analysts' estimate of $45.31 U.S. Lyft aggressively courted workers and brought 50% more new drivers to its platform during the second quarter compared to the previous one.
The company has lowered costs since last year, cutting hundreds of employees and continuing tight cost controls. In April, Lyft said it would sell its self-driving division to a subsidiary of Toyota Motor Corp. (NYSE:TM) for $550 million U.S.
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