Lyft Inc (NASDAQ:LYFT) shares are plunging on Wednesday after the company posted disappointing fourth‑quarter numbers and several analysts cut their price targets in response.
What's Driving the Decline
Lyft reported fourth-quarter bookings growth of 18.6% year-over-year, reaching $5.1 billion, but that result still came in below expectations, according Wedbush analyst Scott Devitt. Total rides grew 11.4%, short of Street estimates of 17.3% and below management's own mid‑to‑high‑teens growth outlook.
Revenue also missed the mark. Lyft generated $1.6 billion, up just 2.7% year-over-year and roughly 9% below estimates, weighed down by a one‑time legal, tax, and regulatory charge.
Analysts Cut Price Targets
Following the report, Wedbush lowered its price target from $16 to $13 and reiterated an Underperform rating, citing weaker ride growth, modest guidance and concerns about Lyft's long‑term ability to hit its targets.
The firm also warned that Lyft likely lost U.S. mobility market share to Uber, noting Uber's consolidated trips grew 22% year-over-year in the same period.
Guidance Didn't Help
Lyft's outlook for quarter-one also came in soft. The company expects gross bookings growth of 16.8% through 20.1%, roughly in line with expectations. Adjusted EBITDA is expected to be between $120 and $140 million, below the Street's $140 million midpoint
Management said ride growth will lag bookings growth as the company shifts toward higher‑priced offerings like premium services and TBR Global Chauffeuring.
Broader Concerns Weigh on Sentiment
Wedbush highlighted longer‑term risks as well, including Lyft's exposure to autonomous‑vehicle disruption and its relatively undiversified business model. The firm believes the market is underestimating the potential negative impact AV adoption could have on Lyft's valuation.
LYFT Price Action: Lyft shares were down 16.85% at $14.01 at the time of publication on Wednesday, according to Benzinga Pro.
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