Stock rollercoaster: Lyft surged 67% in after-hours trading after suggesting it would hit profits of £725m this year
Investors in ride-hailing app Lyft endured a bumpy ride after a “clerical error” in results sent the stock up more than 60 per cent, before doing a sharp 180-degree turn.
Lyft soared in after-hours trading on Wall Street on Tuesday after suggesting it would reach profits of £725 million this year. Within minutes, shares soared 67 percent to $20.
But the rally was short-lived as the San Francisco-based group corrected itself, saying it expects profits to reach around £230m, sending the shares back to earth with a hit.
When trading resumed in New York yesterday, shares rose 30 percent, still an impressive gain but a far cry from the initial surge. A company spokesperson attributed the error to an “administrative error.”
Dan Ives, an analyst at Wedbush Securities, called it “a debacle of epic proportions.”
The mistake was just the latest headache for the company, which has lost about 80 percent of its value since its initial public offering in 2019.
The business competes with larger rivals Uber and Bolt, which have tended to dominate the ride-sharing market.
But last year’s fourth-quarter numbers suggested things might be improving.
Lyft said bookings in the final three months of 2023 were 17 percent higher than the previous year, at £2.95 billion.
Revenue reached £960m, while losses narrowed to £21m.