Yahoo Finance

Welcome back to Yahoo Finance. We're still out here in San Francisco at the Goldman Sachs Communacopia conference holding it down, talking some AI, and let's talk some ride share now. Lyft CEO, Dave Risher, David, good to see you again. Weren't we just here?

Good to see you, Brian. I think it just was a couple of days ago or was that last year?

Yeah, maybe either way. But good to see you nonetheless. So last year when we talked to you,

Yeah.

you were still getting your plan in place thinking about what you were going to do for the next 12 months. Is Lyft still in that turnaround mindset?

It is. It is, but it's at a different stage. So a year ago, it was really about reorienting the company towards customer obsession, right? And this is sort of my thesis. You've heard me say this a thousand times. Customer obsession drives profitable growth. So what does that look like over the last year? We've lowered prices. We've gotten our driver pay in line. We've launched women plus connect that allows women riders and drivers to choose each other, and that's produced growth quarter after quarter after quarter after quarter. We just announced last quarter our first profitable quarter, which is fantastic. We've got more drivers on the platform than ever. We're doing two million rides a day, 800 million rides a year. So all that's great. So that's sort of phase one, right, of kind of.

And now the question is kind of where do you go from here? And I'm just super excited about our next couple years. I think we've got a huge opportunity ahead of us.

Where do you think Lyft is a year from now?

A year from? Well, I tell you what, we are going to compete like heck on service. So from a rider and driver perspective, what I hope is that when you ask people, "Why did you choose Lyft?" They say, "Because they just provide great service and better service than the other guys." And I think if we can do that over and over again, you know, great things will happen.

What did you say in your earnings call about about a can of whoop-ass on the competition?

A Well, that's the one thing about on streaming network, you can pretty much say whatever you want.

Awesome, so I'll say it right here. Yeah. No, we did open up a can of whoop-ass, but it wasn't actually on our competition. It was on a feature that people hate with a fiery passion. And that's surge pricing.

Surge pricing. Yeah, exactly. So this is an area where I think the innovation that we're bringing to the table really matters. So nobody likes prices that bounce around. It's super obnoxious. And part of it just comes with the territory, you know, the concert gets out, you know, there are only 100 cars and there are a thousand people. So there you're going to get some surge pricing. But for the daily use, like commute, this new product that we launched called price lock allows you to say, "You know what? Every day, I'm going to go to work between 8:00 and 9:00, and I'm never going to pay more than 15 bucks." And you literally lock it in for a month. And it's been a great, great launch. It really has taken something that's annoyed people and taken it off the table.

Surge pricing, to your point, look, it pisses a lot of people off. I mean, do you see it eventually going away?

I don't think it'll ever go away entirely because remember what happens when prices surge. Basically, what's going on behind the scenes is we're paying drivers more to drive right then. Maybe it just started raining, or maybe a concert or an event just got out. So a lot of it is just that, and that you probably won't get away from. But what we can get away from are the more predictable times. Like we know what's going to happen with commute every day. And the more people who sign up for price lock, the more signal we get about where there's going to be demand and when. So that really allows us to sort of even it out and take it off the table.

Moments before you came on, uh, David, I talked to AT&T CEO, John Stankey, and he was talking about how his customers, his employees are still dealing with high levels of inflation. And I'm like, "You know what? That could be a tie-in with with Lyft." You're seeing more drivers on the platform. Do you think that is because of macro concerns where people are looking for that extra side hustle to offset budget pressures?

You know, I look at it actually in an even bigger picture way. I think the gig economy is so here to stay. And I think it's hard for people, particularly folks like me, I'm an old guy, I was born in the 1960s, grew up in the 70s and 80s. So I think of a career in a certain way. Today's workforce is so much more about, I have work, I've got maybe another side hustle, I've got personal obligations, I've got free time. And so while I think yes, there is a little of that, for sure. I mean, when the economy stumbles, in fact, just on this for another second, there are macroeconomists who think that the gig economy is actually an incredibly important almost sort of, uh, pressure relief valve, you know, it allows people to sort of cycle in and out of this sort of, you know, let's say you lose your job and you can sort of cycle into gig, and then you can kind of go back into a full-time if that's what you want. Anyway, having said all that, our driver supply is super healthy, but I don't really think it's because of budget pressures in general. I think it's because we've done a good job creating a platform that people like to earn on.

Uh I love that you you study, uh, travel from airports. And the other undercurrent here at this conference is that things have seemed to slow down a little bit in the economy. What are you seeing with trips leaving from airports because we have heard from the travel companies that things have slowed down a little bit?

Yeah.

So it's so interesting you bring that up. It's one of the use cases we look at very carefully, and we actually had seen some of that earlier in the summer. In fact, we mentioned that on our last earnings call. We just got data today, and this is data we look at every day, I just happened to get it, that says that our airport rides have now completely gotten back to 2019 levels. So we'd seen a little bit of that, there was a little bit of a bump, but right now, it's actually looking stronger than ever.

From what I could tell, you're delivering on a lot of things that you laid out a year ago. The top line is improved, you had the cost cuts, the profits are improving.

Yep.

Why is the stock still down 7% in the past year?

Yeah.

I mean, look, I don't, the short answer is I don't know. I'm not a stock picker. I'll tell you what I what I do know though, and that is, well, first of all, we are building for the long term. We absolutely are. And that's why, you know, again, our our service levels are better than ever, our pricing's better than ever, and we've just got profitable and we are throwing off cash. So from our perspective, you know, all that's good. So then the question becomes why all the sort of noise in the stock market. You know, I think there's sort of two things. I think part of it is just sort of macro concerns about the consumer. As I said, we saw a little of that, but we're not having, in fact, we we've gotten stronger even since the last quarter, and even our share is ticked up versus our big competitor. So I think that was just a little bit overblown, and people see that. I think also there's a lot of interest in the world and what happens in a world of autonomous vehicles, and whether that's going to be good for us or bad for us. I think it's going to be great for us. I think it's going to bring new supply and frankly bring an experience onto the platform that a lot of people will find pretty cool and interesting.

Do you think people are going to want to rent out their cars and or does Tesla have the right model in robo taxis?

I mean, I don't know. You know, we'll have to see what they say. I think look, if that becomes an interesting model, that's something we're going to be super excited about, right? Remember, we have 1.4 million people who drive on the platform every year. Every single one of those we have to onboard, we have to pay, we have to offboard when they don't want to anymore and all that. So we know how to do that at scale. So if people want to put their AVs on our platform, that's great. That's what we're going to make easy. But anyway, I think that's a little bit of a, you know, uncertainty in some people's minds. But the truth of the matter is, when I look out five years, ride share is going to be so much bigger even than it is today. Kids today, it's not about getting your first driver's license anymore. Old people today, it's not about please take the cars. It's you know what, the keys, it's I can still do what I what I want to do. So I'm I'm very, very bullish both on our position, but also on the overall industry, even if there's bounces up or.

Lyft CEO, David Risher, good to see you again. I appreciate it.

It was great to see you. Thank you, Brian. Yeah.

Uh Julie Josh, back to you. I can't believe this guy was born in the 60s. Can you believe? Guys on fire, looks great.

Thank you. Thank you, Sozzi.