Lyft’s IPO Filing Shows Ridership Is Surging—So Are Losses

Lyft’s ridership has grown dramatically in the last two years, to the point where the company estimates that 9 percent of the US adult population has taken a ride.

Drew Angerer/Getty Images

It’s on. After months of speculation, Lyft took the wraps off its filing for an initial public offering Friday. The ride-hail company got a jump on its rival Uber, which reportedly plans to file for its own IPO soon.

The filing did not specify a valuation for Lyft, which was last valued in a private financing round in June 2018 for $15.1 billion. Uber raised its last private financing round at $76 billion, and will reportedly seek $120 billion valuation when it files for IPO.

Lyft’s filing tells a nuanced story about the company—and the ride-hailing industry at large, which is pulling in plenty of money even as it struggles to stem its losses.

Lyft’s ridership has grown dramatically in the past two years, from 6.6 million at the end of 2016 to 18.6 million at the end of 2018. Lyft estimates that 9 percent of the US adult population has taken a Lyft ride. It also says its year-over-year increase in riders hit 47 percent in December. That’s a lot of growth.

Lyft is also giving more rides than ever, jumping from 52.6 million at the end of 2016 to 178.4 million at the end of 2018.

And the company doubled its revenue in 2018, to $2.2 billion, from $1.1 billion a year earlier.

Lyft seems to believe that it can attribute at least some of its last three years’ of growth to one big thing: Uber’s branding cock-ups. In the filing, the company writes it got a big boost in revenue per active user in the first and second quarters of 2017 because “our brand and values continued to resonate with riders and they increased their usage of Lyft instead of competing offerings.” Remember the #DeleteUber movement in the weeks following the Trump administration’s travel ban, and the blog post from engineer Susan Fowler that cast a spotlight on Uber’s sexist culture? Lyft appears to believe those helped its bottom line.

But Lyft’s costs and expenses are growing, too. Last year, for example, the company spent $804 million—nearly twice what it did in 2016—on sales and marketing to new riders and drivers.

As a result, Lyft’s losses are widening, reaching $911 million last year. Uber self-reported an adjusted loss of $1.8 billion in the same period. The companys’ dueling IPOs mean everyone will be watching as they try to turn it around.

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