Leaked financial documents suggest that in the first half of the year, Uber competitor Lyft generated less revenue and lost more money than it had projected earlier this year, according to a new report from Bloomberg’s Eric Newcomer and Alex Barinka.
According to Bloomberg, Lyft lost $US127 million in the first half of 2015 on $US46.7 million in revenue. Additionally, in the same time period, the company spent $US96.1 million on marketing expenses, paying out big bonuses to drivers and doling out discounts to customers.
One disclosure in the financial documents, a fundraising presentation put together by investment bank Credit Suisse, reads: “The company has a history of losses and is not projected to be profitable in the foreseeable future.” The numbers in the presentation were not audited, Bloomberg reports.
That’s not totally surprising, and it certainly doesn’t mean the company is in any grave danger. Many tech companies that raise a lot of money aren’t profitable, and some even go public while they’re still in the red. Just look at Amazon.
And Lyft is also still learning how to estimate its growth, according to documents obtained by Bloomberg. The company missed the revenue projections it made earlier this year:
For instance, the company predicted in February that it would facilitate 7.4 million rides in July, bring in revenue of $US25 million, and lose $US14 million. It reported about half as many rides as expected, missed revenue projections by a third, and lost almost two and half times more than forecast.
Uber, by comparison, generated $US415 million in revenue last year and lost $US470 million, according to Bloomberg.
Both Uber and Lyft are currently said to be in the fundraising process: a new report from the New York Times says Lyft is looking to raise $US500 million in funding at a $US4 billion valuation. That’s almost double Lyft’s current $US2.5 billion valuation. And Uber is said to be closing yet another $US1 billion round of funding that would value the company as high as $US60 or $US70 billion.
On Tuesday, Lyft announced it expects to reach $US1 billion in annualized gross revenue in a year’s time. In October, Lyft made $US83 million off of 7 million rides, which is how the company calculated the $US1 billion revenue run rate.
Earlier this year, Lyft and China Uber rival Didi Kuaidi announced a strategic global partnership. The alliance, which goes into effect early next year, lets you pay in your native currency on each app to avoid having to pay for your Didi or Lyft ride in a foreign currency, depending on where you live. So if you’re an American visiting China, you can open the Lyft app to pay for and order a Didi, and then Lyft will give whatever money it made from your ride to Didi.
Lyft and Didi are also reportedly in talks to expand their alliance with other Asian ride-hailing companies: India’s Ola and Singapore’s GrabTaxi.
We’ve reached out to Lyft for comment on the financial documents and will update when we hear back.
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