Lyft CEO David Risher told CNBC’s Jim Cramer on Friday he doesn’t need to annihilate the competition — namely ride-share behemoth, Uber — to successfully turn around the struggling company.
“I don’t need to dethrone a king,” Risher said, insisting the current market warrants two players because customers and drivers like to have options. “Five years from now, I hope people are no longer asking about Uber and Lyft,” Risher continued, “I hope what they’re saying is, ‘Look what an amazing experience Lyft has created that’ll help us get out and live our lives.'”
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Risher assumed the role of Lyft CEO just under a month ago, taking the reins from one of the company’s co-founders, Logan Green. Risher made his name as an Amazon retail executive, joining the company in 1997 as its 37th employee, he told Cramer; he left in 2002.
Risher launched his tenure at Lyft with mass layoffs, cutting just over 1,000 jobs, or 26% of its corporate headcount, while forgoing hiring for another 250 roles. Those moves are in addition to the 13% headcount reduction Lyft announced in November.
Lyft stock has floundered since its initial public offering in 2019, subsequently losing nearly 90% of its value. Over the past year, Lyft shares have fallen 59% and set a fresh 52-week low Friday, at just over $8 each.
Lyft’s second-quarter guidance, issued last week, proved disappointing for investors, with projections for revenue and a measure of adjusted operating profit — earnings before interest, taxation, depreciation and amortization, or EBITDA — coming in lower than expected. However, in the first quarter, Lyft’s revenue totaled $1 billion, up 14% from last year and larger than the $982 million consensus estimate.
Along with layoffs, Lyft is making other changes to break out of its financial slump, including the launch of new airport preorder meant to streamline airport pick-ups. The new feature allows Lyft customers to book rides as soon as their plane hit the tarmac, with the app scheduling pick-ups with an eye toward unpredictable airport nuisances like waiting for baggage claim. Lyft announced the new feature on Thursday, and it is currently available at Chicago’s O’Hare International Airport and Los Angeles International Airport, with a few other airports on the way soon.
Risher told Cramer Lyft’s pricing strategy going forward will be to stay in line with its peers, differentiating itself instead with unique features like airport preorder as well as “wait and save,” which allows customers to be flexible with pickup times to obtain a lower price. The feature accounts for 30% of Lyft’s volume, Risher said, adding that the option is more popular with customers than pooled rides, a lower-cost option Lyft officially discontinued Thursday that allowed riders heading in similar directions to share rides.
And while autonomous vehicles may not be in the cards for Lyft just yet, Risher said the company is keeping an eye on future opportunities.
“We’re doing everything we can to make sure we’re ready for autonomous when it comes, and I’m telling you – It’s not going to be tomorrow, but you might be surprised that it comes over the next couple of years a little faster than you think,” Risher said.
