Ridesharing has been increasing as of late, with the last week of February being the strongest for the company since March 2020. Lyft also said it expects the growth to continue into March, with the end result being positive year-over-year growth in rideshare volume for the second half of the month.
In a Securities and Exchange Commission (SEC) filing on Tuesday (March 2), the company said the new trend would let it narrow losses.
With the new numbers, Lyft will now have an adjusted EBITDA loss in the first quarter of $135 million. Previously, the forecast was for around $145 million to $150 million.
Even while the pandemic ravaged Lyft as well as its chief rival Uber, both have been angling to become profitable this year with an adjusted EBITDA basis.
The two companies have employed different strategies to get to that goal, with Uber spinning off its less popular businesses while betting large on their food delivery business, Uber Eats, which has become wildly popular over the pandemic.
Lyft, meanwhile, is focusing on ridesharing right now, although it said late in 2020 that it was considering a delivery company of its own, CNBC reported.
But Lyft decided against much expansion in Q4 as it looked at the ways the pandemic was still limiting travel. The company had fourth-quarter revenues of $570 million, a 14 percent increase from the last quarter, and the company was still looking at ways to cut costs and invest in new technology. Some ideas being explored include improvements to mapping, pricing and dispatch, which could make driver arrival times better and do away with passenger pickup friction.
The focus on eliminating costs did well for Lyft, which saw its fixed costs drop $360 million in Q4, which was 20 percent better than they thought it would be.