An empty Lyft pickup area is shown as ride-share drivers hold a rally as part of a statewide day of action to demand that ride-hailing companies Uber and Lyft follow California law and grant drivers “basic employee rights,” in Los Angeles on Aug. 20, 2020.
Mike Blake | Reuters
Lyft missed second-quarter revenue estimates on Wednesday, weighed down by intensifying competition with Uber and weakening U.S. travel demand, sending its shares down about 9% in trading after the bell.
Larger rival Uber Technologies, which offers ride-hailing, food and grocery delivery business globally, issued an upbeat forecast for the third-quarter earlier in the day, thanks to its efforts to boost engagement across its unified platform.
Lyft’s revenue of $1.59 billion in the second quarter missed estimates of $1.61 billion, according to data compiled by LSEG.
The company recently completed its nearly $200 million acquisition of European mobility platform FreeNow and has signed a deal with China’s Baidu 9888.HK to introduce the search engine giant’s robotaxis in the region.
Lyft on Wednesday also announced a partnership, set to launch later this year, with United Airlines that will allow the carrier’s customers to earn rewards on all Lyft rides.
With partnerships including DoorDash and Chase already in place, Lyft’s entry into Europe positions the company to extend such collaborations into international markets.
Lyft said it expects gross bookings to be between $4.65 billion and $4.80 billion for the third quarter, well above estimates of $4.59 billion.
With growth stagnating in major U.S. metros, ride-hailing companies are shifting their focus to medium and smaller car-dependent cities to tap into new markets and drive revenue.
Lyft recorded an adjusted core earnings of $129.4 million in the second quarter, above the average estimate of $124.5 million.
It forecast current-quarter core earnings of $125 million to $145 million, largely in line with Wall Street estimates.
