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LYFT Announces Further Workforce Trimming to Save Costs
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It is no secret that ride-hailing company, Lyft (LYFT - Free Report) is suffering from high costs, which in turn is hurting its bottom line. Also, economic uncertainties are weighing on Lyft's prospects. As part of its cost-reduction exercise, LYFT has laid off almost 700 employees or 13% of its staff in November 2022 and 60 in July 2022.
The company’s new CEO, David Risher, announced plans to trim its workforce even further by laying off more employees. Per a Wall Street Journal report, the company will be laying off at least 1,200 full-time employees (30% of its staff).
The move is expected to save costs and drive bottom-line growth. Hence, it has found favor with investors, causing share price appreciation. Lyft shares were up 6.1% in Friday’s trading.
The stock has remained under continuous pressure and declined 5.2% year to date against its industry’s 18.8% appreciation.
Image Source: Zacks Investment Research
In fourth-quarter 2022, Lyft’s net loss was $588.1 million compared with $283.2 million in fourth-quarter 2021. On the flip side, Lyft’s rival Uber (UBER - Free Report) has witnessed a turnaround in its fortunes from the pandemic lows.
Even though Uber’s primary business is ride-sharing, it has diversified into food delivery and freight over time. Uber is benefiting from the boom in its delivery business as volumes of online order increase. Although economies are reopening, people’s thirst for placing orders online is rampant, which ensures Uber’s business to remain in good shape.
Encouraged by the segment's performance during pandemic, UBER is constantly expanding its delivery operations. Shares of Uber have gained 24.7% year to date.
Zacks Rank & Key Pick
Both Lyft and Uber currently carry a Zacks Rank #3 (Hold).
Shopify is benefiting from growth in e-commerce spending. The Zacks Consensus Estimate for SHOP’s current-year earnings per share has been revised 20% upward over the past 60 days.
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LYFT Announces Further Workforce Trimming to Save Costs
It is no secret that ride-hailing company, Lyft (LYFT - Free Report) is suffering from high costs, which in turn is hurting its bottom line. Also, economic uncertainties are weighing on Lyft's prospects. As part of its cost-reduction exercise, LYFT has laid off almost 700 employees or 13% of its staff in November 2022 and 60 in July 2022.
The company’s new CEO, David Risher, announced plans to trim its workforce even further by laying off more employees. Per a Wall Street Journal report, the company will be laying off at least 1,200 full-time employees (30% of its staff).
The move is expected to save costs and drive bottom-line growth. Hence, it has found favor with investors, causing share price appreciation. Lyft shares were up 6.1% in Friday’s trading.
The stock has remained under continuous pressure and declined 5.2% year to date against its industry’s 18.8% appreciation.
Image Source: Zacks Investment Research
In fourth-quarter 2022, Lyft’s net loss was $588.1 million compared with $283.2 million in fourth-quarter 2021. On the flip side, Lyft’s rival Uber (UBER - Free Report) has witnessed a turnaround in its fortunes from the pandemic lows.
Even though Uber’s primary business is ride-sharing, it has diversified into food delivery and freight over time. Uber is benefiting from the boom in its delivery business as volumes of online order increase. Although economies are reopening, people’s thirst for placing orders online is rampant, which ensures Uber’s business to remain in good shape.
Encouraged by the segment's performance during pandemic, UBER is constantly expanding its delivery operations. Shares of Uber have gained 24.7% year to date.
Zacks Rank & Key Pick
Both Lyft and Uber currently carry a Zacks Rank #3 (Hold).
A better-ranked stock in the same industry is Shopify (SHOP - Free Report) . Shopify currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shopify is benefiting from growth in e-commerce spending. The Zacks Consensus Estimate for SHOP’s current-year earnings per share has been revised 20% upward over the past 60 days.