According to business magazine Forbes Lyft is on the road to $1 billion In gross revenue over the next 12 Months. Lyft, the San Francisco-based ride-hailing company that’s battling with Uber, is showing that second place doesn’t always mean you’re the first place loser. Company president and co-founder John Zimmer announced at the Los Angeles Auto Show that Lyft is on track to reach $1 billion in gross revenue over the next 12 months. Lyft did 7 million rides in October alone, which amounted to about $83 million in gross revenue – or sales that do not remove the fees that are paid to drivers.
Those numbers shed some light on the growth inside America’s top alternative to Uber, which is by far the dominant player when it comes to ride-hailing. In August this year, it was reported that Uber – now valued at more than $50 billion based on a recent round of funding – was expected to do about $2 billion in net revenue in 2015. Lyft, by comparison, is valued at $2.5 billion, after more than $1 billion since its early 2012 start.
Despite the disparity in figures and valuations, Zimmer told Forbes that the “market is incredibly large,” and more than justifies the existence of a number two player. He noted that $2 trillion is spent on cars every year in the US, while figures from AAA showed that the average American household spends $9,000 a year on automobiles, which are used only about 4% of the time.“The other 96% of the time they’re parked and that’s a horrible occupancy rate.”” said Zimmer. “If the average Lyft Line is $9, someone could take 1,000 rides a year.”
The shift to using Lyft or Uber as a primary mode of transportation is already happening in urban areas, he added, as figures from San Francisco show that some passengers are ordering more than 100 rides a month. Based on a data from a third-party, which Lyft declined to reveal for “competitive reasons,” the company now has 40% market share in its first market of San Francisco and a 45% market share in Austin, where it launched in June 2014. It also said it tripled its market share in New York City, but declined to give hard numbers on the company’s size in the nation’s largest city.
In April, Bloomberg News, citing documents it had seen, reported that Lyft was on track to do $796 million in revenue for 2015, up 512% from the $130 million in sales it had done in 2014. It’s unclear if those figures were dealing with net or gross revenues and Zimmer declined to discuss past numbers. The documents also noted that the company, which is not yet profitable, expects to receive 26.2% of each fare by December 2015, up from 6.7% in July 2014. Unlike Uber, Lyft is not available (yet) outside the United States, though it said last month that it is in 150 markets and has 100,000 active drivers.
• Lyft gains ground on Uber in the US.