Lyft (LYFT 1.87%) stock is soaring in Wednesday's trading. The ride-hailing company's share price was up by 31.5% as of 1 p.m. ET, according to data from S&P Global Market Intelligence.
Lyft published its fourth-quarter results after the market closed Tuesday, reporting earnings that beat Wall Street's expectations. In response to what turned out to be an error in the earnings press release, the company's share price initially rocketed more than 60% higher in after-market trading Tuesday. The original text said that Lyft forecast that its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) margin would expand by 5 percentage points in 2024. In fact, it expects that margin to expand by 0.5 percentage points. But even after what management described as a "clerical error" was publicly corrected and the guidance figure was revised downwards, Lyft has still been posting explosive gains Wednesday.
Even with a major correction, Lyft's Q4 report was strong
In 2023's fourth quarter, Lyft posted a net loss of $26.3 million on revenue of $1.22 billion. The company's sales grew roughly 4% year over year in the period and were in line with the average analyst estimate.
On the other hand, the company's non-GAAP (adjusted) earnings per share came in far better than analysts had anticipated. The business recorded adjusted earnings of $0.18 per share, surpassing Wall Street's consensus call for earnings of $0.08 per share.
The company also delivered guidance that pleased the market -- even after the error on the adjusted EBITDA margin forecast was corrected.
What comes next for Lyft?
For this year's first quarter, Lyft is guiding for bookings to come in between $3.5 billion and $3.6 billion. Meanwhile, adjusted EBITDA is projected to be between $50 million and $55 million -- good for a margin of 1.45% at the midpoint.
For the full year, the company expects total rides conducted through its platform to rise by a mid-teens percentage. Bookings growth is expected to slightly exceed rides growth, pointing to a small pricing increase.
In addition to top-line performance drivers, the company also announced that it would be trimming its workforce and cutting back on capital expenditures. As a result, management expects the business to be free-cash-flow positive on an annual basis for the first time this year.
