Lyft Revenue and Usage Statistics (2019)

Mansoor Iqbal

Updated: April 29, 2019

Lyft is a ride-hailing business in the Uber-mould, albeit operating exclusively in the North American market. It currently offers services in 350 US cities, and Toronto and Ottawa in Canada.

It was launched in 2012, as a part of long-distance car-pooling business Zimride – the largest such app in the US (named for transportation culture in Zimbabwe). Zimride co-founders Logan Green and John Zimmer were looking for a way to foster daily engagement, rather than the infrequent sort which comes with long-distance ridesharing.

Operating on a similar model of connecting passengers and drivers, and facilitating payments between the two, the solution was to offer shorter rides within cities. Alongside the greater potential for growth, this also allowed them to move toward a long-term goal of providing an alternative to car ownership. The fledging Uber at this point was focused on a corporate rather than everyday service. In contrast to this, Lyft app users were encouraged to sit in the front seat and fist bump the driver. Lyft’s symbol was – and remains – a pink moustache. The original furry grille-mounted version, however, has been retired in favour a more discreet glowing pink dashboard version.

A rebranding to Lyft followed in 2013, with the Zimride rideshare business sold to car-rental business Enterprise Holdings. Launched in Silicon Valley, Lyft quickly spread, growing from 60 US cities in April 2014 to 300 in January 2017, to 350 today – plus the two aforementioned Canadian cities.

It was not always plain sailing. In New York, Lyft was forced to comply with various regulatory hurdles before being permitted to compete with the iconic yellow cab. Lyft also faced a legal challenge in California but was ultimately allowed to operate alongside Uber in the new category of ‘transportation network company’ in 2013. Operations in other cities/states also were met with resistance; overcome relatively quickly in some instances (Seattle, Washington DC), but with more difficulty in others, such as Austin, Nashville, and Illinois.

Despite these general objections to the business model as a whole, Lyft has by and large avoided the controversies that have dogged its main rival Uber in recent years. Indeed, these have let the smaller company gain significant ground on its more-famous competitor.

Lyft boasts a robust passenger base in the US, commanding a significant share of the market – 29-35% as of early 2019, depending on who you ask. Investment has come from domestic (General Motors, Alphabet, and Peter Thiel’s Founders Fund) and international (Didi Kuadi, Tencent, Alibaba, Rakuten) sources.

Valued at $15 billion in mid-2018, in late February 2019 papers were filed for a Lyft IPO. This is considered to be the ‘starting gun’ in a race with Uber. As planned, Lyft went public on March 29 2019.

The race between the two is not confined to the stock market: like Uber, Lyft is also involved in the development of self-driving cars, working with Ford and London-based AR startup Blue Vision Labs. Lyft self-driving car services have been running in Las Vegas in partnership with Aptiv (an offshoot of parts-supplier Delphi), with over 5,000 rides completed as of August 2018.

Read on to learn more about Lyft, including passenger numbers, how it compares to Uber, and the early performance of the Lyft IPO.

Table of Contents

Lyft User Statistics

Lyft Driver Statistics 

Lyft vs. Uber Statistics

Lyft Usage Statistics

Lyft Revenue Statistics 

Key Lyft Statistics

    • 23 million Lyft users (Jan 2018)
    • 1 billion Lyft rides given as of September 2018
    • Lyft US market share figured at 29-35%
    • 1.4 million Lyft drivers (December 2017)
    • 17% of rideshare drivers work primarily for Lyft; 20% for Lyft and Uber equally
    • Total Lyft driver earnings stood at $3.6 billion over 2017
    • All-time Lyft driver earnings at $10 billion (year end 2018)
    • Lyft drivers earn $364-377/month on average
    • 91% of Lyft drivers drive under 20 hours/week
    • Three quarters of Lyft drivers are satisfied with their experience
    • Lyft claim the average driver makes $18.83/hour, increasing to $21.08 in top-25 markets (pre-expenses)
    • Lyft services available to 95% of the US population
    • 41% of Lyft riders identify with a minority ethnic group (compared to 39% overall population)
    • Lyft riders’ average household income stands at $50,000
    • 44% of Lyft rides end or start in low-income areas
    • Lyft users hail rides 4.9 times a month on average
    • 29% of users have used Lyft to access healthcare services
    • Highest average Lyft monthly spend is in San Francisco, at $89
    • Lyft is the sixth-most expensed company in the US, accounting for 3.4% of total expenses
    • Business travellers rate Lyft 4.7/5 on average
    • Lyft claim 250,000 users ditched cars because of availability of ridesharing services
    • 20% of Lyft users have used Lyft bike and scooter services
    • 223 million of first billion Lyft rides were shared through Lyft Line
    • 83% of Lyft users approve of automated car research
    • Lyft grew at a compound growth rate of 223% between 2014 and 2017
    • Lyft revenue stood at $2.2 billion in 2018 – 103% up on 2017
    • Gross takings came to $8.1 billion in the same year
    • Lyft losses stood at $0.9 billion in 2018
    • Lyft valued at $15.1 billion in mid-2018
    • Lyft began trading on Nasdaq in late March 2019, with shares priced at $72, rising to $78.29 at the end of the first day; this had fallen as low as $54.35 by late April 2019
    • One month after concluding the first day of trading at $26.5 billion, Lyft’s market cap had declined by $10 to $16.5 billion

Lyft User Statistics

As of January 2018, Lyft could count 23 million users.

In October 2018, Forbes estimated Lyft’s total userbase would increase to 29 million by the end of 2018, each of whom would take an average of 19 rides per year. This is a marked increase from the 2017 figure of 16.3, and 2016’s 13.6.

This would have the effect of increasing total Lyft rides per year to 551 million, from 375.5 million in 2017, and 162.6 million in 2016. Forbes notes that their estimate is conservative. Indeed, with Lyft gross booking and net revenue figures superseding Forbes’ numbers, the real figure is almost certainly in excess of this prediction.

Lyft users/rides per user/total rides

Lyft users/rides per user/total rides

Source: Forbes

Stats published on Pitchbook show that active riders per quarter have been on the increase. A mere 3.5 million active Lyft users in the first quarter of 2016 more than doubled to 8.1 million a year later. This feat was nearly repeated over the following year, with active Lyft users in Q1 2018 numbering 14 million. By the end of 2018, the figure stood at 18.6 million.

Lyft active users per quarter

Lyft active users per quarter

Source: PitchBook

Lyft is available in 350 US cities, and Toronto in Canada. The company’s founders have said that they will not be pursuing further international expansion.

There is still plenty of room for Lyft to grow, with 41% of respondents ‘somewhat familiar’ with the app, compared to 25% who were ‘very familiar’. The remaining 34% are ‘not very’ or ‘not at all familiar’ with Lyft – though we might have to factor in the non-urban population who are not served by Lyft.

Awareness of Lyft

Awareness of Lyft

Source: Statista

Lyft services are available to 95% of the US population.

Lyft user demographics

Lyft users are slightly more likely to belong to a minority group than the US population as a whole, with 41% of Lyft riders identifying with a such a group, compared with 39% of the overall population. This can most likely be ascribed to the Lyft’s predominantly urban field of operation, with cities tending to count higher levels of minorities that rural areas.

The median household income of Lyft riders stood at around $50,000 – slightly below the US-wide median household income reported in 2017 of $58,000. Lyft state that (excluding Canada), that 44% of Lyft rides begin or end in low-income areas, suggesting that the company is helping to make transport accessible.

An analysis by Statista of the US ride-hailing market as a whole finds that the majority of users fall into the 25-34 bracket (51%). The 18-24 and the 35-44 brackets are nearly equally matched at 22% and 21% respectively.

This is perhaps as we would expect, with the 25-34 bracket most likely to be the kind of (sufficiently) affluent digital natives to whom private-hire vehicles summoned through mobile apps would be expected to appeal.

Ride-hailing users age demographics                        

rideshare age demographics

Source: Statista

Interestingly, the same survey shows a strong male skew in the US users of ride-hailing apps, with men accounting for nearly two-thirds of respondents. Could this be connected with safety concerns for female passengers? It might be noted that Lyft has tended to operate more stringent driver safety checks than Uber.

Ride-hailing gender demographics

Ride-hailing gender demographics

Source: Statista

The greatest proportion of rideshare app users seem to fall into the high-income bracket according to this survey, with the brackets diminishing in size as we go down the income brackets.

This differs to Lyft’s serving of those living in low-income areas. Uber will dominate these numbers, so we can assume this trend is more reflective of the bigger company, with Lyft perhaps more active in the not-insignificant proportions from lower income brackets.

Ride-hailing income demographics

Ride-hailing income demographics

Source: Statista

Lyft healthcare services

In 2016, Lyft announced a partnership with the National MedTrans Network. This is aimed at helping senior citizens in New York City who may not have smartphone (over 25% of those over 65) use Lyft services to get to non-emergency appointments. Around 3.6 million Americans, said Lyft, have to miss medical appointments due to not having access to transportation. An estimated $2.9 billion of Medicaid funds is spent on non-emergency medical transportation annually in the US.

This service is facilitated through a web-based system called Concierge, which allows users to book a ride through Lyft on behalf of those who are not able to book it themselves. Lyft reported that 2,500 used this every week before the partnership was announced. The National MedTrans Network at the time reported giving 25,000 rides per week in New York. The ambition of the Lyft-National MedTrans Network partnership was to conduct all of these through Lyft.

The former had been manually ordering services through Lyft prior, which had led to an investigation from Lyft’s fraud team into the number of rides being ordered from the same place.

This was the first such partnership. Since then Lyft has partnered with Logisticare, the largest transportation broker in the US (70 million annual rides), as well as the rest of the top-10 biggest such organisations. These medical partnerships seem to be having a positive effect, say Lyft. In one case (CareMore – partner of the American Medical Association), patients reported satisfaction levels of 80%, the result of a 30% reduction in wait times, and 32% savings per ride. Lyft report that these savings allowed CareMore to offer 28,000 additional rides for no extra cost. Missed appointments were reduced by 27%.

Concierge is limited to Lyft services; in order to help partners order services where Lyft transport would not work, Lyft helped build Concierge-like functionality into their own tech, according to Entrepreneur.com. These systems are now even reportedly used by hospitals. Nine top healthcare systems in the US partner with Lyft. 7.2 million patients have access to Lyft services through integration with AllScripts

Lyft business travellers

A report from business expense management software provider Certify found that use of Lyft among business travellers nearly doubled between Q1 2017 and Q1 2018, from a 10% share of total ground travel expenses to 19%. Ride-hailing companies as a whole accounted for 71% of ground-transportation expenses – up from 8% in 2014.

Ride-hailing had the highest market share as compared to taxis in San Francisco (99%), Dallas (91%), and Los Angeles/Boston (both 89%).

While Uber might still dominate, Lyft has become the sixth-most expensed company according to Certify’s data, in Q3 2018. At this stage, Lyft controlled 20% of the ride-hailing market for business travellers, compared to 73% for Uber. Taxis accounted for the remaining 7% – down from 74% in 2014.

Most-expensed companies US

Most-expensed companies US

Source: Recode

These figures are consistent with Certify’s end-of-year statistics, though with Lyft registering 1% less over the course of the year. These also show that ride-hailing accounted for 15% of business expenses over 2018. Average Lyft spend for business travellers stood at $25 – $1 less than Uber.

While Uber may control the higher market share, Lyft is the highest-rated brand in its category, with business travellers giving its services 4.7 stars. This compares to 4.5 for Uber and a mere 4.0 for taxis.

Ground travel expense stats

Ground travel expense stats

Source: Certify

Lyft took a 3.4% share of all business expenses in Q4 2018, up from 0.6% in 2016, and 1.9% in 2017. Uber registered 11.9%.

Lyft Driver Statistics

As of the end of year 2017, there were 1.4 million Lyft drivers.

Over the course of 2017, Lyft reported that total driver earnings increased 140% to an annual figure of $3.6 billion, plus $240 million in tips (120% up on 2016).

From launch to year end 2018, total Lyft driver earnings stand at $10 billion. Lyft report that as of September 2018, total driver tips stand at $725 million.

The busiest Lyft driver in terms of rides has completed 31,000 journeys. According to Lyft statistics published in 2017, Lyft drivers typically earn $364-377 month on average.

Some statistics about Lyft driver demographics are included in Lyft’s annul Economic Impact Report. This reveals that the majority of those driving for Lyft (91%) are very much a part of the gig economy, driving for under 20 hours per week. Confirming this, 96% say a flexible schedule is very or extremely important.

A quarter of those driving for Lyft are over the age of 50, which is around the same as Uber, while 9% previously served in the armed forces.

Lyft driver demographics

Lyft driver demographics

Source: Lyft Economic Impact Report 2019  

As with Lyft riders, there’s a slightly higher ratio of those identifying as a minority ethnic group (56%) driving for Lyft than in the US population as a whole (39%). 27% are female.

Stats are available on a state-by-state or even a city-by-city basis in Lyft’s annual Economic Impact Report.

A survey of rideshare drivers published by the Rideshare Guy in February 2018 found relatively high levels of satisfaction among Lyft drivers. Around three quarters somewhat or strongly agree with the statement that they are satisfied with their experience of driving for Lyft. 17%, on the other hand, somewhat or strongly disagreed.

Lyft driver satisfaction

Lyft driver satisfaction

Source: The Rideshare Guy

The survey reported average hourly earnings of $17.37 for Lyft drivers. This compares with $16.90 for Uber drivers. These figures are pre-expenses. Lyft drivers receive 75-80% of the total fee for each ride.

Living wage regulations passed by New York City in December 2018 stipulated that people driving for Lyft and other ride-hailing companies must be paid $17/hour after expenses – or $26.51 before. The Taxi and Limousine Commission who set this rate estimates that Uber and Lyft drivers currently make $11.90/hour after expenses. The city’s minimum wage requirement increased to $15/hour at the end of 2018.

Lyft expressed opposition to the plan, saying that it would allow competitors to undercut it, and that it would prevent drivers from making trips outside Manhattan (to which the regulations are limited). Uber also warned of a potential increase in fares. In late January 2018, Lyft and rival Juno filed lawsuits to block the rise, two days before it was to come into effect.

Using data collected from “tens of thousands” of loan applicants, Earnest calculated how much Lyft drivers and other workers in the shared economy earned on a monthly basis. Driving for Lyft brings in a mean average of $377, with median earnings standing at $210.

This compares relatively favourably against other sharing economy companies. This should not necessarily be read positively or negatively, as the nature of the sharing economy means that earnings will vary on an individual basis, dependent on a number of factors, not limited to, but perhaps most pertinently, hours worked in the case of Lyft.

Lyft driver earnings versus other sharing economy employers

Lyft driver earnings versus other sharing economy employers

Source: Earnest

With the same caveats, breaking it down into earnings brackets we see that greatest proportion of Lyft drivers earn $100-$499 per month. This compares to 39% of Uber drivers, who are more likely to fall into the sub-$100 bracket.

Lyft driver earnings brackets versus other sharing economy employers

Lyft driver earnings brackets versus other sharing economy employers

Source: Earnest

Another study from the J.P. Morgan Chase & Co. Institute pegged average rideshare driver earnings at $783/month in 2017, down from $1,469 in 2013 (again, we need to factor in hours).

Lyft promise up to $2,500 in the first month to drivers who accept 90% of available rides and drive for 30 hours/week for at least 65 rides. If earnings do not come up to this point, the company makes up the difference.

Figures published by the company itself sets Lyft driver earnings at $18.83/hour, increasing to $21.08 in the top-25 markets. This increases to $29.47/hour and $31.18/hour if we only discount idle time after the app is activated but no rides have been hailed and accepted.

Lyft driver earnings figures

Lyft driver earnings figures

Source: The Verge

These earnings figures are before expenses incurred by drivers are taken into account. These are believed to be around $3-5/hour – figures reported by the Rideshare Guy and approved by Lyft.

Around 55% of rideshare drivers identified pay as the most important thing to them in the Rideshare Guy survey, compared to 35% who elected flexibility. Notably the average figures come out well under what Lyft and Uber drivers think they should be earning – $25.67.

Interestingly, 45% of Lyft drivers reported satisfaction with Lyft Line – a multiple occupancy carpool option, analogous to Uber Pool, with a further 21% neither agreeing nor disagreeing. While these numbers may not be a resounding victory, they are far superior to Uber Pool, where 64% of drivers were not satisfied.

Lyft Line is a key element of Lyft’s purported goal to increase the number of shared rides in order to effect positive environmental change.

Lyft Line driver satisfaction

Lyft Line driver satisfaction

Source: The Rideshare Guy

In terms of employment status, it seems drivers working for ride-hailing services prefer the status of independent contractor over being an employee (these stats apply to Lyft and Uber drivers collectively).

Rideshare driver employment status preference

Rideshare driver employment status preference

Source: The Rideshare Guy

As we might expect, a higher proportion of full-time drivers would seek employee-status (26% vs. 18% of part-time drivers).

Lyft vs. Uber Statistics

As of January 2019, Lyft claimed 29% of the ride-hailing market in the US, compared to Uber’s 69%, according to Second Measure. This represent a gain of 3% since January 2018, and crowns an impressive few years for Lyft, which has gained a good deal of ground on the once seemingly untouchable Uber. Other competitors could lay claim to no more than 3%.

Lyft vs. Uber market share, January 2019

Lyft vs. Uber market share, January 2019

Source: Second Measure

Of course, Second Measure’s analysis is not taken as gospel by all sources.

Lyft themselves claimed a 35% share of the market in May 2018 – up from 20% 18 months before. Uber stats showed a slightly less generous picture for Lyft at this stage, giving it a share of 28-30%. For comparison, Second Measure had Uber at 73% and Lyft at 27% at the same time. Business expense-focused Certify found Uber still dominating the corporate market, with an 81% share.

Yet another analysis from Edison Trends, cited by Yahoo Finance in November, finds similar figures, though slightly less favourable for Uber, pegging its market share at 65%, compared to 31% for Lyft.

Lyft vs. Uber market share

Lyft vs. Uber market share

Source: Yahoo Finance

Breaking Second Measure’s 2019 Lyft statistics down by state, we can see that Lyft performs more strongly towards the West Coast, and northern parts of the Midwest (the lighter blues denote an above average market share for Lyft, the darker for Uber).

In terms of the top-spending cities, Seattle comes out on top here in terms of Lyft spending, followed by San Francisco, and Austin.

Lyft vs. Uber by state/top cities

Lyft vs. Uber by state/top cities

Source: Second Measure

While Lyft may only operate in the US, the US is the world’s biggest ride-hailing market. Ergo Lyft’s market share globally stands at around 10%, according to Forbes (a market which also delivers higher returns per ride).

Second Measure’s stats show stronger engagement for Uber, which is hailed 5.8 times a month by users, compared to 4.9 times for Lyft.

An alternative study from money app Empower looked at how much Lyft and Uber users spent on average in various cities across the US, drawing on data from 50,000 of its users. This data shows Lyft spending actually outstripping Uber in a smattering of cities across the US, including San Diego, Portland (Oregon), Pittsburgh, Orlando, and Fort Lauderdale. It pushes Uber close in many of the markets where the better-known company still has primacy.

The last of these records an average monthly Lyft spend of $85, compared to $46 average Uber spend. This is not, however, the highest average amount spent per month on Lyft, which can be found in the lucrative San Francisco, at $89 (compared to $110 on Uber – the only incursion into three figures recorded by this analysis).

Lyft is very much playing catch-up in cities in the northeast such as Boston ($95 to $55), New York ($84 to $54), and Philadelphia ($73 to $46).

Lyft vs. Uber average monthly spend by city

Lyft vs. Uber average monthly spend by city

Source: CNBC

A survey of drivers published by The Rideshare Guy in February 2018 showed that over half of surveyed rideshare drivers worked primarily for Uber. 20% reported working for Lyft and Uber equally, while 17% were primarily Lyft drivers. This about tarries up the market shares reported above.

Lyft vs. Uber: Which do drivers use?

Lyft vs. Uber: Which do more drivers use?

Source: The Rideshare Guy

Nearly half of drivers, however, are signed up to more than one service – showing that brand loyalty may not be what drives them to use one over the other. Nearly a third of drivers are signed up to three services or more (UberEats is counted a separate service from Uber here).

How many rideshare services do drivers use?

How many rideshare services do drivers use?

Source: The Rideshare Guy

The same survey shows that Uber claims a driver market share of 88% (down 1% on 2017), while Lyft is up to 75%.

Market share held by ride share businesses

Market share held by ride share businesses

Source: The Rideshare Guy

Lyft vs. Uber in New York

In New York, Uber has overtaken traditional taxis to become the most-popular (private) way to travel in the city. As of November 20 2018, 485,000 Uber rides were taken per day. At 139,000 rides per day, Lyft is also closing in on classic taxis (293,000). Uber, however, seems to be pulling further and further into the lead.

Lyft vs. Uber vs. taxis in NYC: rides per day

Lyft vs. Uber vs. taxis in NYC: rides per day

Source: Todd Schneider

In terms of fleet size, Lyft is not so far behind Uber, at 47,000, compared to 76,000 for Uber. There are 15,000 taxis (the numbers of which are controlled). The greatest proportion of rides to vehicles, therefore, comes from full-time taxi drivers, followed by Uber. The higher proportion of rides per vehicle for Uber perhaps comes from the greater brand recognition making it a more appealing choice for those who want to pursue ride-hailing as their main or one of their main earning streams.

Lyft vs. Uber vs. taxis in NYC: vehicles in fleet

Lyft NYC fleet

Source: Todd Schneider

Lyft remains comfortably ahead of other rival names, such as Via, Juno, or Gett. Of these, Juno is the closest, with 21,000 vehicles completing 35,000 rides per day, though Gett comes close, with 32,000 rides per day given by a relatively miniscule fleet of 6,000 vehicles.

Lyft vs. Uber subscription services

In autumn 2018, both Lyft and Uber launched subscription services.

Lyft’s was labelled the Lyft All-Access Plan – launched in October 2018. Users pay $299/month, for which they can take up to 30 rides up to the value of $15 (paying the difference on any rides that go over this value). After the 30 included rides, users receive a 5% discount. Lyft claimed that this service cost 59% less than owning a car.

Around the same time, Uber Ride Pass was rolled out. This sees users pay $14.99/month – or $24.99 in Los Angeles – to avoid surge pricing.

Both services are, according to the respective companies, aimed at a reduction in car ownership. Lyft and Uber alike had reportedly been piloting subscription schemes for some time before launching them. Lyft had previously looked at charging $200/month for their service.

An analysis by Vox questioned the logic of Lyft’s pricing model, which seemingly would only benefit a small number of regular riders. Uptake by those who already spend more than this would not be beneficial to Lyft revenue. The high price point seems unlikely to entice those who spend much less. A goal of making people choose Lyft over car ownership may help frame the service, though this, of course, is ambitious.

The value of Uber’s service on the other hand is a bit simpler to measure, seemingly targeting those who would spend more than $15/month in surge pricing but who choose alternative modes of transport to avoid it. For those that regularly pay more than $15/month in Uber surge pricing, it’s something of a no brainer (though again, not necessarily beneficial to Uber). It should be noted that there is something a question mark around this, given surge pricing is imposed by Uber in the first place…

Lyft vs. Uber growth

In a Yahoo Finance article which posits that Lyft may be more appealing for investors than Uber, it is noted that between 2014 and 2017, Lyft grew at a compound growth rate of 223%, greatly outstripping Uber’s 146%. See Lyft Revenue Statistics below for more analysis of the comparative finances of Lyft and Uber.

It is predicted that the ride-sharing industry is going to grow eightfold by 2030 – so while Uber may have a seemingly unassailable lead, there is still a lot to play for here. The same, of course, can be said of Lyft’s rapid growth – while it has been catching up, it could quite easily by left for dead, or overtaken by another competitor.

Lyft vs. Uber vs. public transit costs

A study conducted by DePaul University compared the relative costs of using Uber, Lyft, UberPool, Lyft Line, and public transport, using Chicago as an experimental base.

Of course, public transit came out cheapest at $2.69, versus $18.13 for Lyft and $17.90 for Uber for roughly analogous journeys (4-11 miles, starting or ending in the north or northwest of Chicago, and mostly passing through downtown).

Lyft Line worked out at more than Uber Pool, at $14.04 compared to $9.33, simply because it is better known and more popular at this stage (this also means that it is slower).

Outside of the city centre, Uber and Lyft were nearly universally faster than public transport, with 90% of journeys completed in less time. This fell when journeys included downtown, particularly for Lyft Line (60% of journeys are quicker) and UberPool (44%).

In calculating whether these journeys are value for money, the study calls on a US Department of Transport Measure which places the value of an hour at $14.95.

By this measure, Lyft and Uber measure up quite badly, despite being quicker. Only 0.2% of private-hire journeys were value for money, and less than 1% of Lyft Line rides (4.9% of UberPool). Cost effectiveness was higher where travelling between non-downtown locations where public transport services were not as good, particularly with Lyft.

Cost of ride-hailing vs. public transport

Cost of ride-hailing vs. public transport

Source: CityLab

Overall the conclusion here seems to be that in neutral conditions (obviously not always present in real life) ride-hailing is not more cost-effective than public transportation. As the above graphic shows, this is less the case where the quality of public transport systems diminish.

Some authorities in the US have even began subsiding ride-hailing services where bus services are diminished. This is an interesting phenomenon as it shows another way that the likes of Lyft and Uber can become an entrenched part of public transportation.

Lyft Usage Statistics

Over the course of 2017, Lyft reported 375.5 million rides – 130% growth over 2016. It reached the one billion rides mark in September 2018. The keenest user of Lyft had taken 9,000 rides as of this point.

In the run up to achieving this, 50 million Lyft rides were being given per month.

To mark this, it released some data highlights from the first billion rides. These included the revelation that the longest single trip taken in a Lyft covered 639 miles – from Denver, Colorado, to Sioux City, Iowa.

Lyft users are more active late at night than early in the morning. 153 million rides took place between 11pm and 2am, compared to 97 million from 5am to 7am (in all late-night rides account for 10% of Lyft journeys). Winter is unsurprisingly the busiest season for Lyft, with 47% of Lyft rides occurring during the coldest season.

Billion rides highlights from Lyft

Billion rides highlights from Lyft

Source: Lyft

The last day of the 2017 was the busiest of the year, with two million Lyft rides on New Years Eve.

Earlier in the year, Lyft had crossed the one million rides per day mark.

Lyft and car usage/mobility

In an interesting statistic calling back to the purported goal of eliminating the private car, Lyft reported in January 2018 that 250,000 of its users ditched private cars as a result of the availability of ridesharing. 50% of total users reported using their car less. Lyft have stated a goal to get a million cars off the road by the end of 2019.

In 2019, they reported that 35% of Lyft’s user base did not own a car. 64% of these say that Lyft has impacted their decision to not own a car; 50% would be more likely to purchase a vehicle if services like Lyft became unavailable.

Other statistics are listed below, showing that 46% of car-owning Lyft users use their cars less because of Lyft.

These stats also show how Lyft contributes to local economies. 34% of riders spend more at local businesses because of Lyft, and 47% are able to explore more areas of their own cities. Lyft state that the availability of its services has increased spending in local economies by $3 billion.

Lyft and car usage/local economies

Lyft and car usage/local economies

Source: Lyft Economic Impact Report 2019  

29% of riders have also used Lyft to access healthcare services, and 71% of Lyft riders report that they are less likely to drive when under the influence of intoxicating substances – hopefully lowering the former figure…

Notably CEO Logan Green grew up in Los Angeles, and was frequently exposed to streets gridlocked by cars occupied by only one person, reports Fortune. President Jonathan Zimmer, on the other hand, studied at Cornell’s prestigious School of Hospitality Management. Here he came to think of cars in the same way that we might think about hotels. With cars used only 4% of the time in the US on average, usually only by one person, the occupancy rate is extremely poor. An estimated $2 trillion is spent each year on car ownership in the country.

Lyft was founded as an attempt to remedy the issues both perceived in the current car-ownership paradigm in the US.

Lyft and environmentally-friendly travel  

In Lyft’s Economic Impact Report 2019, Lyft also reports how users combine Lyft rides with public transport, and Lyft’s own scooter and bike services (see below). The report states that the presence of ridesharing services can increase public transit ridership by 5% over two years.

Lyft report that 46% of their riders take public transport at least once a week, with 25% use Lyft in the place of public transport when it is not operational. Lyft also report that its passengers save 178 million hours compared with other forms of transport.

20% of rideshare users had reportedly already used bike or scooter share already – low-emission scooter trips account for 10% of Lyft trips in the areas of Denver where it is available.

Lyft and public transport usage/scooter and bikeshare usage

Lyft and public transport usage/scooter and bikeshare usage

Source: Lyft Economic Impact Report 2019  

Lyft has aimed to make 50% of its rides shared Lyft Line services by the end of 2020. As September 2018, when Lyft crossed the billion rides threshold, 233 million rides – ergo just under a quarter – were shared. There’s some way to go, then, if they want to meet this ambitious target.

In 2018, Lyft became a carbon neutral company. In a February 2019 blog post, it announced its ambition to introduce thousands of electric vehicles to its network. Riders will be able to request EV service specifically through ‘Green Mode’.

Lyft bike and scooter-sharing

In July 2018, Lyft bought Motivate – the largest bike-rental company in North America, with a market share of 80%. Motivate was renamed Lyft Bikes. The deal saw Lyft acquire Motivate’s operations in eight major cities across the US, including New York and Chicago.

Reports indicate that the deal was worth $250 million. This makes Lyft the largest bikeshare operator in the US.

As with so many of Lyft’s business moves, Uber has something similar planned, announcing plans to acquire Jump Bikes a few months before – and even expressing an interest in Motivate before Lyft acquired it.

Lyft has announced ambitions to expand the Motivate-operated Citi Bike scheme in New York to 40,000 – triple its current size.

Lyft offers scooter services in nine cities across the US, including Washington DC, Denver, and Austin. These scooters travel at 15 mph, and are the pavement-based versions favoured by children as opposed to the Vespa-type of mini motorbike.

Lyft and social issues

Lyft helped to register 20,000 people for the 2018 midterm elections in the US. It also committed $1.5 million in free rides to rallies across the country, and raised $11 million through a feature which lets passengers round up their fare to support various charities.

Lyft self-driving car research

Like other ride-hailing businesses such as Uber and Didi Chuxing, Lyft is involved in self-driving car research, under its Level 5 division.

Lyft launched a Ford fusion hybrid in October 2018, after announcing its intention to do so in July 2017. The cars are currently being tested on public roads in California.

Luc Vincent, lead engineer at Lyft, announced that Lyft would doubling staff numbers working on automated car technology over 2019.

Also in October 2018, Lyft also acquired London-based augmented reality startup Blue Vision Labs, whose technology uses “computer vision to process street-level imagery”, according to The Verge.

Blue Vision’s offering centres on an AR cloud, which uses data from multiple users to build collaborative city maps, requiring nothing more advanced than a smartphone (Vincent helped to launch Google Street View, so Lyft’s and his interest in this tech is a good indication of its potential).

Lyft reportedly paid $72 million, with a further $30 million when certain milestones are hit.

Lyft has been working with Aptiv – a self-driving offshoot of car-parts supplier Delphi – in Las Vegas since January 2018. As of August 2018, 5,000 paid rides were completed in Aptiv’s fleet of 20 self-driving cars (75 Aptiv automated cars operate in the city in all), serving around 20 popular locations on the Las Vegas Strip. The companies plan to expand the fleet and the number of destinations.

Passengers can choose to opt-in to the self-driving pilot, and can turn down the service when a car has been sent. A human backup driver remains in place in case of emergency.

The two claimed that they were running the only commercial taxi service in the US (Waymo – Alphabet/Google’s automated car offshoot – began to run commercial services in Arizona in December 2018). The self-driving cars received an average rating of 4.96/5.

Lyft is also partnering with Ford in a similar fashion. The latter aims to launch an automated ride-hailing fleet by 2021; the service will be offered through Lyft.  Chevrolet have also partnered with Lyft, as has Jaguar Land Rover, which funded Lyft to the tune of $25 million. The latter deal will see Jaguar Land Rover supplying Lyft with vehicles as it develops its self-driving car technology. This was eclipsed by the $500 million invested by GM in 2016.

To facilitate future partnerships, Lyft plans to offer a ‘full-stack’ of technology, which allows any car manufacturer to roll out a fleet of automated cars using Lyft’s network.

83% of Lyft users approve of self-driving cars, the company reported in January 2018. How drivers feel is less clear (mature driverless technology will eliminate 300,000 jobs a year, says Goldman Sachs).

Lyft R&D costs stood at $300 million in 2018 – more than double the $136.6 million reported in 2017, which itself is over double 2016’s $64.7 million.

Lyft Revenue Statistics

In 2018, Lyft revenue stood at $2.2 billion (net) – double the figure earned over 2017, which itself was three times 2016 Lyft revenue. As with Uber revenue figures, net revenue is total takings minus drivers’ share, rather than indicating ultimate profit/loss.

Lyft revenue grew 103% between 2017 and 2018, and 209% between 2016 and 2017.

Like many highly successful private companies – Uber is perhaps the most prominent example – Lyft has operated consistently in the red. Over 2018, Lyft lost $911 million; up significantly on the $688 million lost over 2017. Its cash balance declined by $600 million over the course of the year.

The below chart shows Uber vs. Lyft revenue figures from 2018. We can see that Lyft revenue is overshadowed by Uber’s figures. Gross bookings are over six times as high, while net revenue (after driver payments are taken into account) are five times as high. On a per-transaction basis, it seems Lyft performs marginally better than its more global rival.

Things are a little less clear cut when it comes to profit/loss. While Uber’s losses are twice the size of Lyft’s, they account for a smaller proportion of total revenue than Lyft’s – though it is thought that Lyft is on a stronger course toward profitability, according to Yahoo Finance (see Lyft vs. Uber above) – albeit in an analysis which predates the release of year-end revenue and profit/loss figures for both companies.

While they may be large, Uber’s losses for 2018 represent a significant improvement on 2017, over which total losses totalled $4.5 billion – though it should be noted that on this measure 2017 was a bad year for Uber.

Lyft, on the other hand, saw losses increase by a third.

Lyft vs. Uber revenue 2018

Lyft vs. Uber revenue 2018

Source: Statista

Lyft has, however, been moving towards profitability over time. In 2014, Lyft net loss stood at 631% of revenue. By 2018, it was a far healthier 41% (with a H1 performance which outstripped predictions by 12%). In the first half of 2017 the figure stood at 62% so improvements are evident in the short as well as the longer term.

Slightly different Craft figures show a positive trend here also, with Lyft’s losses as a percentage of revenue climbing from 202% in 2016, to 67% in 2017, and 45% in 2018.

Despite conservative predictions on profitability from Lyft itself (see below), the movement here does at least seem to be in the right direction.

Lyft revenue per ride

A 2018 assessment of a prospective Lyft IPO Forbes estimate Lyft average gross revenue per ride at $13, up slightly on 2016’s $12.50 though unchanged from 2017. Total gross revenue, however, was predicted to increase to $7.5 billion from $5 billion in 2017 ($2 billion in 2016) by virtue of growth in the number of rides given. The latter figure is estimated to have increased from 375.5 million to 551 million.

Gross revenue exceeded Forbes’ estimate, reaching $8.1 billion over 2018, with net Lyft revenue (see above) of $2.2 billion also considerably outstripping the predicted $1.5 billion in this analysis.

Average Lyft net revenue per ride came in at $3.56, with drivers taking a cut of 75-80%. Lyft’s share of gross bookings has come down since 2016, say Forbes, when it stood at 35%.

Forbes predicts that gross revenue/ride figures will remain stable in future years. The path to increased revenue, then, is related solely to increasing the total number of Lyft rides given.

Lyft revenue per ride

Lyft revenue per ride

Source: Forbes

On the other hand, the narrative is slightly different if we look to Lyft figures published in Bloomberg. These show that Lyft revenue as a share of total transportation takings has been on the rise. This has been on the up since mid-2016, at which point it stood at 14.7%, reaching 23.3% a year later, and climbing as high as 28.7% by the end of 2018.

Bloomberg, however, warn that these take rate statistics may not be the most edifying numbers for investors, as Lyft’s business model diversifies to include bikeshare and scooters.

Lyft revenue as a share of transactions

Lyft take rate

Source: Bloomberg

It’s also worth noting that increased take rates from the core ride-hailing business will be at the expense of drivers.

The current gross margin figure is roughly analogous to big names in the retail industry, rather than other tech companies, which report far higher rates as the result of lower overheads.

Lyft take rate vs. retailers

Lyft take rate

Source: Bloomberg

Lyft valuation and funding rounds

The last big funding round before the Lyft IPO was filed was an injection of $600 million, led by Fidelity Management, in June 2018, giving the firm a valuation of $15.1 billion. This took total Fidelity investment in Lyft to $800 million.

As of early March 2019, total Lyft venture capital funding raised stood at $4.91 billion, according to Pitchbook.

The largest stake is held by Japanese firm Rakuten, with 13%, followed by General Motors (7.8% – GM invested 500 million in 2017), Fidelity (7.7%), Andreessen Horowitz (6.3%), and (5.3%).

This $15.1 billion Lyft valuation was double the figure reported a year previously. As of July 2017, investment in Lyft came to $2.6 billion, from what Fortune describe as a ‘who’s who’ list – giving Lyft a valuation of $7.5 billion. Investors include China’s two biggest tech conglomerates, Alibaba and Tencent, and venture capitalist Ben Horowitz.

Other investors include rock band Linkin Park, GM, and Jaguar Land Rover’s InMotion.

Lyft IPO

Lyft IPO papers were filed in late February 2019, aiming to start trading on Nasdaq by late March. Reports indicate that Lyft plans to raise up to $100 million. Reports indicated that Lyft expected a valuation of $20-25 billion.

As planned Lyft went public on March 2019, with shares priced at $72 a piece – a valuation of $24 billion. This puts is about level with Snapchat, and a little bit under Airbnb’s expected IPO value. Uber is expected to launch at a value around five times greater.

Lyft IPO value vs. other tech startups

https://markets.businessinsider.com/news/stocks/lyft-stock-how-valuation-compares-to-other-tech-names-at-ipo-2019-4-1028090958

Source: Markets Insider

Initially, things seemed to be going extremely well, with prices climbing to nearly $79 by the end of the day, thus giving us a Lyft market cap of $26.5 billion. This was not to last, however – and within two days Lyft share price had dipped beneath IPO value.

One month on, share price had fallen to $57 (this does not quite represent the lowest ebb recorded a few days prior: $54.35).

Lyft share price – first month

Lyft share price first month

Source: Business Insider

Lyft market cap in late April stands at $16.5 billion – a whole $10 billion down on that recorded on the first day. Despite this, analysts are reportedly still bullish on Lyft stock. A survey carried out by Bloomberg a few days before the above graphic was published found 14 recommending ‘buy’, eight ‘hold’, and only one to sell Lyft stock. Indeed,  JPMorgan analysts forecast that share price could go as high as $82, on the basis of Lyfy’s history of innovation and the potential inherent in the market.

Investors  and observers are watching closely to see what happens next, with Uber, Airbnb, and Slack waiting in the wings. How a heavy loss-making business operates in the scrutiny of public trading will be interesting to see (the company’s loss making was stated as a risk factor in the Lyft IPO filing).

As well as the year-to-year losses, Lyft also has $3 billion worth of state and federal ‘net operating loss carryforwards’, which allow them to deduct losses from future earnings.

These begin to expire in 2021 at state level and at 2030 at federal. Lyft have warned that they may not be able to use them before then, as they may not be generating taxable income within this period – a potential warning to investors anticipating an easy buck.

Global ridesharing market

A 2017 analysis published by NextBigFuture found that the US was the world’s biggest rideshare market, worth a total of $11.8 billion. By 2030, however, China is predicted to overtake the US – though not by a huge margin. The two biggest markets are set to more than double in size to reach $26.6 billion and $25.9 billion respectively (other studies find that China is already the biggest market by some way).

While none of the other top-five markets will come close to matching these figures, all are predicted to nearly double or double in size.

With Lyft yet to show any interest in international expansion, however, it is the generous growth in the US market which will be of key interest – and certainly it seems there will be a lot for which to play.

Biggest rideshare markets predicted growth

Biggest rideshare markets predicted growth

Source: NextBigFuture

Goldman Sachs estimate the worldwide ridesharing market could grow eightfold by 2030, to reach a total value of $285 billion, from the 2017-figure of $36 billion. This would be worth $65 billion to ride-hailing companies, assuming a 23% commission from gross bookings. The point of profitability will only come with self-driving cars, Goldman Sachs predicts.

This compares to a $108 billion taxi market. Around 15 million ride-hailing trips are made each day, set to increase to 97 million by 2030. Other sources estimate that 685 million will use ridesharing services by 2020.

In a slightly-less long-term analysis of the US ride-hailing market, Statista estimate that userbase will grow to 56 million in 2019 from 45 million in 2017, continuing to steadily grow at a gradually declining rate to reach 61.3 million by 2023.

US ride-hailing market

US ride-hailing market

Source: Statista

To look at it another way, ride-hailing market penetration is set to grow from 14% in 2017 to 18% in 2023. 16.2% is the 2019 estimate.

US ride-hailing market penetration

US ride-hailing market penetration

Source: Statista

Statista estimate that the US rideshare market will be worth $18.5 billion in 2019, well up on 2017’s $12.7 billion. This will increase to over $26 billion by 2023.

US ride-hailing market revenue forecast

US ridesharing market revenue

Source: Statista

While these figures may be pleasant reading for Lyft and other players in the US ride-hailing market, this robust rate of growth is almost certainly unsustainable. This is borne out by Statista’s analysis, which finds that 2019’s 18% revenue growth will give way to a 14% rate in 2020, falling to 6% by 2023.

2019’s figure already marks a notable slowdown since 2017, when growth rates stood at 23%.

US ride-hailing market growth forecast

US ride-hailing market revenue forecast

Source: Statista

As ride-hailing becomes more ingrained, it is predicted that ARPU will increase substantially from $283 in 2017, through $346 over 2019, to reach $429 by 2023.

ARPU US ride-hailing market

ARPU US ride-hailing market

Source: Statista

Final thoughts

Lyft will always (as much as we can safely say anything can be forever) live in the shadow of Uber, which enjoys one of the world’s more notable first-mover advantages. It has, however, stolen a march on Uber in terms of long-in-the-making IPOs. How much that will be worth in the long-term remains to be seen.

As a raft of other tech unicorns wait in the wings, all eyes will be on the performance of the Lyft IPO over the next few weeks and months. Certainly, it will be interesting to see how a company that has operated consistently in the red will be treated by the stock market. The first few weeks have certainly proved harsh – though it seems premature to call it a wake-up call yet (with analysts continuing to predict big things for Lyft stock).

When it comes to quarterly reports, will investors tolerate this seeming disregard for the bottom line, with a view to greater gains in the future? Or will they demand quicker results?

Automated car research looks set to be at the heart of this; a potential black hole in terms of investment, but one that could be the key to future profitability as the costs associated with human drivers are no longer part of the equation. That is, of course, providing tight regulations aren’t imposed on the nascent market…

Lyft has largely avoided the tarnished reputation which has Uber has suffered in recent years – albeit not to the extent that it is toppled from its perch. That Lyft has managed to avoid any major scandal, however, does not mean that there are not many of the same questions around it as there are around Uber.

Issues of driver pay, inner-city congestion, resistance from the established taxi industry, and the gradual commodification of public services under the guise of altruism are all question marks against Lyft. A raft of drivers out of the job as services become automated would be the icing on the cake.

On the other hand, self-driving cars do seem very much on the horizon and do, indeed, have their positives. We might view Lyft’s efforts here as a valuable contribution to the furtherment of key technologies (albeit with a view to profit from them). Various efforts to reduce environmental damage can also be viewed in a positive light. And improving financial performance and user metrics also indicate that there is some regard for the bottom line after all – a long-term vision.

We must remember that this is the first decade in which transport network companies have operated, changing the way millions of people around the world travel. They may become more entrenched over the 2020s – or may even be superseded by another model as they themselves superseded the taxi.

Now we are seeing these disruptive startups become the status quo in the transport sector as they go public, led by Lyft. Will this allow them to consolidate their dominant position? Or hamstring them by robbing them of the advantages of their nimble startup status? Whatever happens will be of huge interest to the likes of Slack, Airbnb, and, yes, Uber.