Lyft seeks slice of food-delivery amid slow ride-hail recovery, shares rise
By Tina Bellon and Akanksha Rana (Reuters) - Lyft Inc said on Tuesday it was working on a new service to take a slice of the burgeoning food-delivery market as it works to make up for a 48% drop in quarterly revenue and a slow recovery of ride-hail demand.
By Tina Bellon and Akanksha Rana
(Reuters) - Lyft Inc
Lyft shares rose 6% in after-hours trading.
Unlike larger ride-hail rival Uber Technologies Inc
But Lyft President John Zimmer on Tuesday said the company was looking to enter what it considered an untapped market by offering delivery services for restaurants without launching a full-fledged consumer-facing platform for food delivery.
"What we're hearing from restaurants is they're looking for a partner who will not charge 30% commission, but still offer delivery service," Zimmer told Reuters in an interview, adding the service would offer new income opportunities to drivers.
While details remain unclear, the offer is aimed at undercutting the prices Uber, GrubHub Inc
Lyft in October announced a partnership with GrubHub that allows Lyft's loyalty-program members free restaurant delivery from GrubHub restaurants.
Lyft's third-quarter revenue fell to $499.7 million (£377 million), surpassing average analyst expectations of $486.5 million, according to Refinitiv data.
Though Lyft shares have surged this week thanks to hopes for a coronavirus vaccine, the stock has overall lost more than 15% this year and now trades more than 50% below the price of the company's 2019 public debut.
Lyft on Tuesday said demand for rides continued to increase in the months from July to September, but active ridership remained down 44% on a yearly basis.
Besides its core ride-hail business, Lyft offers bike, electric scooter and car rentals in several cities, but does not break out financial details of those units. Lyft on Tuesday said performance improved at those units.
Third-quarter active riders stood at 12.5 million - a significant increase from the 8.69 million in the second quarter but a far cry from the 22.3 million riders who used Lyft during the third quarter of last year.
Lyft reaffirmed its goal to reach profitability on an adjusted basis of earnings before interest, taxes, depreciation and amortization by the end of 2021. The company so far this year has implemented drastic cost cuts, including wide-ranging layoffs.
Lyft reported a third-quarter adjusted EBITDA loss of $239.7 million, narrower than the $254.1 million loss expected by analysts.
The company said the quarterly adjusted EBITDA loss was $25 million narrower than Lyft's recent forecast, reflecting progress in reducing costs.
Unlike Uber, Lyft operates only in some Canadian cities and the United States, where Uber last week said demand for ride-hail trips recovered the slowest compared with other regions around the world.
Uber last week reported $3.13 billion in third-quarter revenue, nearly half of which came from its food-delivery unit. Uber said it could become profitable on an adjusted EBITDA basis by the end of 2021 even if rides continue to remain 10% to 20% below pre-pandemic levels.
Uber and Lyft recently scored a significant win in their California home market, where voters passed a company-sponsored ballot measure that cements the status of app-based food-delivery and ride-hail drivers as independent contractors, not employees entitled to unemployment pay, health insurance and other costly benefits.
Gig workers in California will now receive limited benefits, including minimum pay rates and accident insurance and the companies hope to turn the California decision into a model for the nation.
Lyft's president, Zimmer, on Tuesday said the company was talking to lawmakers in other states and on the federal level and added he was optimistic that the model would be implemented more widely.
"Politicians in other states were surprised how successful this measure was in a very progressive state," Zimmer said, referring to California.
(Reporting by Tina Bellon in New York and Akanksha Rana in Bangaluru; Editing by Peter Henderson and Matthew Lewis)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.
ADDIS ABABA/NAIROBI (Reuters) - Ethiopia's military is fighting battle-hardened troops in the northern Tigray region, threatening stability around the Horn of Africa. Here are some facts on the forces: THE NATIONAL MILITARY: THE ENDF The Ethiopian National Defence Force (ENDF) has around 140,000 active personnel, the vast majority of them in the army, according to the Janes security data group. Its troops have been tested by Islamist militants in Somalia and rebel groups in Ethiopia's border regions, as well as a two-year border war with Eritrea followed by an 18-year standoff that only ended in 2018.
ISTANBUL (Reuters) - Turkey's President Tayyip Erdogan said on Tuesday that the government will impose tighter measures to fight with the coronavirus and impose partial lockdowns on weekends across the country. Speaking after the cabinet meeting, Erdogan also said all schools will remain closed until the year-end and all restaurants will only work by delivery
BRASILIA (Reuters) - Brazilian President Jair Bolsonaro said on Tuesday his government in coming days will name countries that are importing wood illegally extracted from the Amazon. Addressing a BRICS summit of big developing economies, Bolsonaro said Brazilian police had developed a way of tracking wood exported from the Amazon using isotopes.