Lyft Stock Under Pressure Into Earnings – EPS To Dip, on Sales Rise

Lyft Inc. (NASDAQ: LYFT) shares are currently trading at $16.84, up 1.41% in today's session. Despite this modest gain, the stock remains under pressure, reflecting a 14.9% decline year-to-date. Investors are keenly awaiting the upcoming earnings report, seeking clarity on the company's strategic initiatives and financial health.

The market anticipates Lyft to report earnings per share (EPS) of $0.12, representing a decrease on the $0.16 this time last year. Revenue is projected to reach $1.75 billion, for a 16.73% year-over-year increase. These figures will be closely scrutinized to assess Lyft's ability to capitalize on the growing demand for ride-hailing services.

Recent developments have painted a mixed picture for Lyft. In September 2025, the company forged a significant partnership with Waymo to launch an autonomous ride-hailing service in Nashville by 2026. This collaboration, which saw Lyft's stock jump 14% to a three-year high, positions Lyft as a key player in the future of transportation. Lyft will be responsible for vehicle maintenance, infrastructure, and depot operations.

However, prior to the Waymo partnership, Lyft priced $450 million in convertible senior notes due in 2030. This move, intended for stock repurchases and general corporate purposes, initially boosted the stock by 4%. The notes have a conversion rate of 42.5170 shares per $1,000 principal amount, translating to a conversion price of approximately $23.52 per share.

Analyst sentiment has been cautiously optimistic. Morgan Stanley has adjusted its price target multiple times, settling at $22.50 with an “equal weight” rating. Sanford C. Bernstein raised its price target from $22.00 to $23.00, maintaining a “market perform” rating. These adjustments suggest a degree of confidence in Lyft's strategic direction, though not without reservations.

Lyft's expansion into European markets through the acquisition of Hamburg-based FreeNow, a ride-hailing platform from BMW and Mercedes-Benz, signals a strategic effort to broaden its global footprint. The $199 million deal is expected to extend Lyft's reach to over 150 cities across nine countries. The deal is expected to close in the second half of 2025.

In May 2025, Lyft increased its share buyback program to $750 million. Despite missing first-quarter revenue estimates, the company reported positive ride metrics, including a 16% year-over-year increase in rides to 218.4 million. Gross bookings rose 13% to $4.16 billion, and active riders climbed 11% to 24.2 million. The stock initially responded positively, rising 19%.

The current stock price of $16.94 sits below both the 50-day simple moving average (SMA) of $19.32 and the 200-day SMA of $17.79. This technical indicator suggests potential bearish momentum, adding to the pressure heading into the earnings release. A break above the 200-day SMA would be construed as a positive signal.

A previous incident involving a typographical error in Lyft's earnings report, where an inflated EBITDA margin expansion was initially reported, serves as a reminder of the market's sensitivity to earnings announcements. While the error was quickly corrected, it led to a temporary 66% surge in after-hours trading, highlighting the importance of accurate and transparent reporting.

Looking ahead, Lyft's ability to successfully integrate FreeNow, capitalize on its partnership with Waymo, and maintain positive momentum in ride metrics will be critical to its future performance. The company must demonstrate a clear path to sustained profitability and growth to reassure investors and reverse the current downward trend in its stock price.