The pandemic took its toll on rideshare companies in 2020, and Lyft (NASDAQ: LYFT) was no different, but its Q4 earnings, released Tuesday after market close, are showing some recovery.
Lyft reported Q4 revenue of $569.9 million versus $1.01 billion in Q4 2019, a 44% decrease. The Q4 2020 revenue, though, was up quarter-over-quarter from $499.7 million, and it beat analysts’ expectations of $561.23 million. Revenue was up 14% sequentially in Q4 and at the higher end of its forecast, co-founder and CEO Logan Green said on the earnings call.
The rideshare company reported a year-over-year decrease in active riders from 22.9 million in Q4 2019 to just 12.5 million in Q4 2020, a 45% decline. That was in line with the Q3 drop, which was down 43.9% year-over-year. For the year, Lyft saw 54.9 million versus 87.5 million in 2019.
Revenue per active rider increased to $45.40 in Q4 versus $39.94 in Q3 and $44.40 a year ago.
Net loss for Q4 was $458.2 million versus $356 million in Q4 2019. The Q4 loss included $138.1 million of stock-based compensation and related payroll tax expenses, and $127.7 million related to changes to the liabilities for insurance required by regulatory agencies attributable to historical periods. Net loss margin for Q4 2020 was 80.4% compared to 35% in Q4 2019.
Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) loss for Q4 2020 was $150 million, up from $19.3 million a year ago. The company noted that adjusted EBITDA net loss improved from Q3’s $239.7 million.
Lyft reported $2.3 billion in unrestricted cash, cash equivalents and short-term investments as of Dec. 31, 2020.
“Despite the difficult backdrop in 2020, we continued to focus on improving our business for the long term,” said Green. “The progress we’ve made has been significant and I believe we are now in a stronger position than at any time in our past. Even as we’ve strengthened our financial position, we’ve continued to fund strategic investments that build on our core competencies and on our marketplace flywheel, to lower costs and deliver more value to drivers, riders and partners.”
Brian Roberts, CFO, said Lyft was able to eliminate $360 million in fixed costs on an annualized basis versus the 2020 plan, which exceeded targeted cost reduction by 20%.
“Our Q4 results also outperformed our most recent outlook. And, while the first quarter of 2021 continues to be uncertain primarily due to COVID-19 headwinds, based on current recovery expectations, we should experience a growth inflection beginning in the second quarter that strengthens in the second half of the year,” Roberts said.
For full-year fiscal 2020, Lyft reported revenue of $2.4 billion versus $3.6 billion in 2019, with a net loss of $1.8 billion, down from 2019’s $2.6 billion net loss.
Net loss for fiscal year 2020 includes $589.5 million of stock-based compensation and related payroll tax expenses and $204.1 million related to changes to the liabilities for insurance required by regulatory agencies attributable to historical periods. Net loss margin was 74.1% and 72% for the fiscal years 2020 and 2019, respectively.
In March 2020, Lyft entered a novation agreement that it said eliminated $407.9 million of primary auto insurance liabilities related to the periods between Oct. 1, 2015, and Sept. 30, 2018, for $64.7 million in transaction costs.
Lyft announced a restructuring effort in April 2020 to reduce operating expenses and adjust cash flows. Those charges included $32.1 million of severance and related employee benefit costs and $3.1 million of lease terminations and other costs in Q2. Lyft also recognized a stock-based compensation benefit related to unvested awards of $49.8 million, resulting in a net restructuring benefit of $14.5 million.
The company also saw $1.4 million in net restructuring costs in November 2020 related to workforce reductions.