Lyft Inc. reported profit in the first quarter that fell short of Wall Street’s estimates after it spent heavily on an international expansion and on adding higher-end offerings like chauffeur services.
Earnings were 4 cents a share, shy of the average analyst forecast for 5.7 cents, due in part to integration costs related to recent acquisitions. Gross bookings, which include taxes, tolls and fees, were $4.95 billion, slightly ahead of expectations of $4.91 billion.
San Francisco-based Lyft has been on a buying spree to catch up with much-larger rival Uber Technologies Inc. and expand beyond North America. The company has been working to integrate the European taxi app Freenow since buying it last year and this week closed its acquisition of UK taxi app Gett.
Those efforts may start to pay off in the current quarter. Gross bookings for the three months ending June 30 will be $5.3 billion to $5.43 billion, topping estimates of $5.31 billion, Lyft said in a statement on Thursday. Adjusted earnings before interest, taxes, depreciation and amortization will be in a range of $160 million to $180 million, the midpoint of which was in line with the average estimate.
San Francisco-based Lyft anticipates its expansion into higher-value services will lead to gross bookings growth outpacing that of rides. In October, Lyft acquired Glasgow-based TBR Global Chauffeuring, a luxury service provider.
“We’ve been deliberately working on our premium offerings – adding more professional drivers,” the company said in a statement. High-value rides have grown 35%, Erin Brewer, Lyft’s chief financial officer, said in an interview.
Shares of Lyft initially spiked but then turned around and slid about 3% in extended trading after the results were released. The stock had been down 27% so far this year through Thursday’s close.
The report comes after after a disappointing first quarter where the number of rides fell short of estimates. The company blamed the shortfall on the storms in the Northeastern US, which impacted more than three million rides. It said 236.9 million rides took place versus Wall Street estimates of 241.5 million.
