Shares of Lyft Inc. surged by 7.6% in premarket trading on May 8, 2025, following the company's unexpected announcement of a first-quarter profit and ambitious growth plans, including the acquisition of European mobility app FreeNow. The ride-hailing firm reported strong quarterly results, with gross bookings reaching $4.16 billion, a 13% increase from the previous year, and revenue rising by 14% to $1.45 billion. Lyft's net income stood at $0.01 per share, a significant turnaround from a net loss of $31.54 million, or $0.08 per share, during the same period last year.
Lyft's active rider count also saw an impressive boost, climbing to 24.2 million, marking an 11% increase year-over-year. This growth underscores the company's strategic pricing initiatives and the rising demand for rides as the market recovers.
Looking ahead, Lyft is optimistic about its future, projecting gross bookings of up to $4.57 billion for the next quarter. This forecast reflects the company's confidence in its ongoing expansion efforts and the anticipated rise in ride demand as summer approaches.
One of the most notable aspects of Lyft's recent performance is its plan to acquire FreeNow, which aims to nearly double its market size by extending its services into nine additional European countries. This move is particularly significant as it positions Lyft to compete more effectively against local and international rivals in the European ride-sharing market.
CEO David Risher expressed excitement about the company’s trajectory, stating, "Q1 marked Lyft’s 16th consecutive quarter of double-digit year-on-year gross bookings growth, demonstrating the resilience and momentum of our customer-obsessed strategy." He highlighted the importance of the acquisition of FreeNow, which is expected to enhance Lyft's competitive position in Europe.
In addition to its international expansion, Lyft launched Lyft Silver, a service tailored for older adults, featuring improved accessibility and support. This initiative reflects Lyft's commitment to serving underserved demographics, providing a simplified interface and live phone assistance to enhance user experience.
Furthermore, Lyft has begun piloting an artificial intelligence-powered Earnings Assistant designed to help drivers maximize their income by offering personalized guidance on optimal driving times and locations based on real-time data. This innovative tool aims to improve driver efficiency and earnings potential.
Investor confidence was further bolstered by Lyft's announcement of a stock buyback program expansion to $750 million, with plans to repurchase $500 million worth of shares over the next 12 months, including $200 million in the next three months. This decision comes in response to pressure from activist investor Engine Capital LP, which advocated for an accelerated buyback to enhance shareholder value.
Despite the positive news, Lyft's revenue of $1.45 billion fell slightly short of analysts' expectations of $1.47 billion. However, the company's adjusted earnings per share of 24 cents surpassed the anticipated 19 cents. Lyft's gross bookings of $4.16 billion also exceeded estimates, indicating a strong performance in a competitive market.
Lyft's strong quarterly results and ambitious growth plans come at a time when the ride-hailing industry is experiencing significant changes. With the anticipated rise in demand for rides during the summer months, Lyft's strategic initiatives are expected to position the company favorably within the evolving landscape of transportation services.
As Lyft continues to navigate the challenges of a recovering market, its focus on expansion, innovation, and customer service remains paramount. The company’s efforts to enhance its offerings for older adults and its foray into Europe signify a proactive approach to meeting diverse consumer needs and capturing new market opportunities.
With a forecast of mid-teen year-over-year ride growth for the upcoming quarter, Lyft is poised to capitalize on the increasing demand for mobility solutions. The company’s commitment to improving driver experiences and expanding its service offerings reflects a dedication to maintaining its competitive edge in the ride-hailing sector.
In summary, Lyft's recent performance showcases a company that is not only rebounding from previous losses but also strategically positioning itself for future growth. With its acquisition of FreeNow and the introduction of innovative services, Lyft is set to enhance its market presence and deliver value to both riders and investors alike.
