Lyft misses quarterly revenue estimates on competition, weak US travel demand

Lyft reported disappointing revenue figures for the second quarter, falling short of expectations due to fierce competition with Uber and a slump in U.S. travel demand. Following the announcement, Lyft's shares took a hit, dropping nearly 9% in after-hours trading. Uber, Lyft's larger competitor, delivered a positive outlook for the upcoming quarter, which they attributed to an increase in user engagement across their diverse services, including ride-hailing and food delivery. Lyft's revenue for the second quarter stood at $1.59 billion, missing analysts' predictions of $1.61 billion, according to data from LSEG. In a bid to enhance its market position, Lyft recently completed the acquisition of the European mobility platform FreeNow for around $200 million and secured a partnership with Baidu to introduce robotaxis in China. Additionally, Lyft announced a collaboration with United Airlines that will allow travelers to earn rewards for every ride taken with Lyft, set to launch later this year. With existing partnerships with DoorDash and Chase, Lyft is strategically positioning itself to expand its reach into European markets. The company anticipates gross bookings for the third quarter to fall between $4.65 billion and $4.80 billion, surpassing the estimated $4.59 billion. As growth in major U.S. cities stagnates, Lyft and other ride-hailing services are now turning their attention to medium-sized and smaller cities, aiming to tap into new markets and boost revenues. Despite the challenges, Lyft reported adjusted core earnings of $129.4 million in the second quarter, exceeding Wall Street's average estimate of $124.5 million. For the current quarter, it forecasts core earnings between $125 million and $145 million, aligning closely with analyst expectations.