FILE PHOTO: An empty Lyft pick-up area is shown as rideshare drivers hold a rally as part of a statewide day of action to demand that ride-hailing companies Uber and Lyft follow California law and grant drivers "basic employee rights'', in Los Angeles, California, U.S., August 20, 2020. REUTERS/Mike Blake/File Photo
(Reuters) -Lyft on Wednesday forecast current-quarter gross bookings above estimates after posting upbeat quarterly sales, indicating steady demand for its ride-hailing services from people returning to workplaces.
Lyft shares, which typically see substantial price swings following its quarterly earnings, jumped about 22% in extended trading.
As more companies enforce return-to-office policies, workers are increasingly turning to app-based taxi services such as Lyft and Uber for their daily commute, leading to a surge in weekday demand for ride-hailing services.
To better compete with its bigger rival, Lyft introduced a Price Lock feature, allowing users to bypass surge pricing during peak commuting hours.
"We see that Price Lock riders take on average 4 more rides per month than they previously did before purchasing the pass," CEO David Risher said in an emailed statement to Reuters.
While Uber last week reported better-than-expected third-quarter revenue, its forecast for the holiday quarter fell short of analyst estimates.
Despite Uber's dominant position in the industry, Wall Street expects Lyft to maintain its strong second-place standing.
"We think the firm had a solid third quarter, with impressive gross bookings and revenue growth. We think the firm is also working effectively on increasing its scale, as you saw both rides and riders increase year over year," Morningstar analyst Malik Ahmed Khan said.
Lyft has implemented several initiatives this year to attract and retain more drivers, including guaranteed minimum earnings and higher pay for longer trips, as it seeks to meet rising demand and compete with Uber.
Revenue surged 31.5% to $1.52 billion in the quarter ended Sept. 30, surpassing analysts' average estimate of $1.44 billion, according to data compiled by LSEG.
It expects gross bookings for the year to grow by about 17%, which is higher than Wall Street's expectation of 16.3%.
Lyft said it was expecting gross bookings between $4.28 billion and $4.35 billion in the fourth quarter, above estimates of $4.23 billion.
It forecast current-quarter adjusted core earnings of $100 million to $105 million, higher than expectations of $85.1 million.
The company's adjusted profit was 29 cents per share, beating estimates of 20 cents per share.
(Reporting by Akash Sriram in Bengaluru; Editing by Anil D'Silva)
