Chilly Weather Puts a Freeze on (NASDAQ:LYFT) Growth Expectations

February 12, 2025 12:48 PM AEDT | By Team Kalkine Media

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Chilly Weather Puts a Freeze on (NASDAQ:LYFT) Growth Expectations — Image source: shutterstock

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Highlights

Cold weather impacts (NASDAQ:LYFT) ride-hailing and bike rentals.

Revenue projections for Q1 2025 fall short of Wall Street estimates.

Company initiates a $500 million share buyback program.

(NASDAQ:LYFT) has faced a setback as colder-than-expected weather conditions affected demand for ride-hailing and bike rental services in early 2025. The company’s latest financial forecast for the first quarter did not meet analysts’ expectations, leading to a significant decline in after-hours trading.

In a statement released on Tuesday, (NASDAQ:LYFT) projected gross bookings between $4.05 billion and $4.2 billion for the first quarter of 2025. This figure fell short of Wall Street’s anticipated $4.23 billion, based on Bloomberg-compiled estimates. Gross bookings, a key indicator of business performance, reflect the total value of rides and other mobility services offered by the company.

Alongside lower-than-expected bookings, (NASDAQ:LYFT) also provided an estimate for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), setting a range between $90 million and $95 million. The midpoint of this projection also came in below analysts’ forecasts, adding to investor concerns.

Despite the weaker outlook, (NASDAQ:LYFT) introduced its first-ever share buyback program, committing up to $500 million to repurchase shares. Share buybacks are often used to return value to shareholders and signal confidence in the company’s long-term potential. However, this move was not enough to offset market reactions, as shares dropped approximately 11% in after-hours trading.

The impact of weather-related disruptions highlights the sensitivity of mobility services to external factors. Colder temperatures can discourage consumers from using bike rentals and reduce demand for short-distance ride-hailing trips. While (NASDAQ:LYFT) continues to navigate these challenges, investors and analysts will be closely monitoring its performance in the upcoming quarters.

With competition in the mobility sector remaining intense, adaptability and strategic planning will play a crucial role in shaping (NASDAQ:LYFT)'s future trajectory. As the company progresses through 2025, market watchers will look for signs of recovery and potential growth opportunities beyond seasonal fluctuations.

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