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- [00:00]
David Rischer
Indiana University strengthens tomorrow's workforce with practical real world experience.
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Narrator
IU grads make a difference in your community, serving as teachers, nurses and engineers
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David Rischer
who rise to tomorrow's challenges and meet them.
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Narrator
Learn more at iu. Edu Impact,
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Interviewer
Bloomberg Audio Studios Podcasts, Radio news. Let's stick with earnings more broadly and shares a ride hailing company. Well, Lyft, we're currently up 2.1%. Let's call after the company reported first quarter profit. Actually some anxiety among Wall street about the expectations, but it was all being ramped up by spending on international expansion. Maybe that's what was hitting in the near term, the profitability metrics. Got to talk to the person who knows all Lyft CEO David Rischer. Look, we've had a volatile trading day for Lyft. There was some pressure as people worried about, well, the amount that you're spending to grow, but you're managing to push back on that. You see to investor base that this is the right use of capital.
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David Rischer
I really think it is, yeah. I mean, look, we had a record quarter, which is always wonderful, almost 5 billion in bookings, EBITDA up 37% year on year, $1.1 billion of free cash flow. So that's great. So when you're in a position like that, that allows you to grow and grow even more. And as you noted, we've done some international acquisitions, just in fact, one announced a couple of days ago, get in the U.K. look, I think it's a great time to be frankly in the rideshare business because we're a really important part of a lot of people's lives and we're growing like a weed, growing like a.
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Interviewer
But Mandy, Bloomberg Intelligence sort of saying that supply growth for Lyft perhaps is likely to trail some larger peers. I mean, talk to us about the adoption rate, the adoption rate of your offerings, but the adoption rate in particular of autonomous vehicles that you're starting to dabble in.
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David Rischer
Yeah. So look, I think if you zoom way in, you can always find little things, Right? So we, we delivered about 237 million rides this last quarter. That's a lot of rides, a lot of commuting rides, a lot of rides to the airport and so forth. Now, the quarter started off a little bit slow. There are some really intense storms, particularly in New York City where you live, you know, that brought ride share and bag share to sort of zero. So that was an early, you know, kind of headwind. But Look, Valentine's Day, St. Patrick's Day, Super bowl, these were all, all time highs. And then we had our highest ride month ever in March. So I think that there's a lot of reason to believe that there's still a huge, huge amount of growth here. And then as you say, autonomous vehicles, that's a great product and that's going to be one of the next big kind of growth vectors up.
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Interviewer
Mark Mahaney over at Evercore really liking the fact that you've got, you know, a record six straight quarter in terms of active riders. But I think where he's liking, see, is maybe consumer incentives to just moderate a little bit. Are you being able to do that, David?
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David Rischer
Yeah, we are. We've gotten a lot of, you know, we think of it as sort of leverage off of consumer incentives. And I'll tell you a particular thing that I'm starting to see more. I think it is rewards maxing. Okay, so. Oh no, you've got to write. There you go, there you go. Be careful now where we're going to go with this one. So anyway, no, but look, we've got to deal with United, right, which allows people to both earn points and also spend points on left, we have a deal with Hilton, we have an arrangement with Alaska Airlines, we have an arrangement with DoorDash, a super, super important program there that just expanded to Canada. And so what we're seeing people do is they're, you know, they're taking Lyft rides, they're earning points and they're spending them elsewhere or they're even spending them back on our platform. And yeah, I think it's going to be a thing. And I think it's one of the reasons why we're seeing high margin, sort of like black and luxury rides rise. Even with some consumer concerns still, this rewards maxing thing I think is working for people.
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Interviewer
Rewards maxing, of course, is a play on all the maxing that we have with looks maxing, all the terms of phrase that Gen Z use. Is it Gen Z? I mean, I mean, how much you see, how much are you seeing the idea of different age groups responding to your new offerings? Because in many ways I see the more premium offerings coming to a, to an older cohort, a more obviously a wealthier cohort, in many ways a corporate cohort.
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David Rischer
You know, I think that's something that's changing over time. I think, you know, back when I was, you know, early in my career, you know, you didn't have an Amex, you know, Platinum card or Chase Sapphire reserve card until you're, you know, old like me now. But no, it turns out actually a lot of kids, a lot of sort of Gen Y, Gen Z folks are early in that ecosystem because they realize that there's a lot of value to be unlocked if they kind of play the game. And I think a lot of them think of it a bit of as almost a play in the game. Like how can I, how can I do this rewards maxing thing to, to be able to afford to lift black even when I'm in my, in my 20s.
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Interviewer
Savvy is what they are. And I'm interested, David, in how savvy you are about the landscape for M and A right now. You've made acquisitions. This is where you've been spending your money. Is there more to come?
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David Rischer
You know, never say never about these things. It's always, you know, a fool's game to predict M and A. But I will say that it's, it's a part of our strategy now. We were not a very acquisitive company for a long time, but now that we've got, you know, the fastest pickup times, great pricing, great service levels all around, we're really thinking of bringing that abroad. And that's really where our M and A focus has been, is overseas employees.
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Interviewer
Any worries about the consumer right now?
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David Rischer
No, no. And I know that sounds glib, of course people are feeling some pain. Our drivers feel a lot of pain at the pump and so that's why we were the first to get out there with a nice cash back program for at the pump. Saves about a dollar a gallon. So you know, there are reasons I think of course for to be concerned. But when we look at the data, you know, we're, we're not seeing that play out.
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Interviewer
David, it's been a week where I feel that you haven't actually mentioned AI yet much. I mean autonomous vehicles is inherently AI. How much though your workforce using it, how much your work course responding to having to use it and is there any stretch at which point you are able to reduce your headcount or hiring on the back of it?
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David Rischer
You know, I love this question and I think it's really important for people to sort of get their arms around this. Absolutely. Something like 86% now of our developers, our software engineers are using actively like every single day using AI to write code for them. We're also using it in customer care. We're using all over the place. But I think there's a way of thinking about it which is not so much about cost reduction but about velocity increase and capacity building. You know, our Imaginations are huge and we're a customer obsessed company. So we have no shortage of great ideas to innovate on behalf of customers. I think that's really where AI is going to give us a big edge. Not so much on this. I mean, cost, sure, we can maybe save a little bit money, but there's so much more value if we can figure out new great ways for, for riders and drivers to use our platform.
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Interviewer
Is it a more competitive backdrop right now?
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David Rischer
Say one more time?
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Interviewer
Is it a more competitive backdrop right now?
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David Rischer
Well, it is, you know, but. But only in the following sense. You know, remember, there are 160 billion rides that people take in their private car every single year. And I think that's ultimately going to be the real competition for us. Look, it's $50,000 to buy a car, 800 bucks a month plus insurance, plus gas, plus maintenance, whereas Lyft is, you know, 20 bucks a ride. So in a funny way, I think the competition is going to shift a little away from the other guys and a little bit more towards what are good ways for you to spend your money and how can you live your best life.
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Interviewer
And rewards max.
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David Rischer
And rewards max, Exactly. I'm glad you picked up on that.
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Narrator
For many men, mental health challenges aren't recognized until they've already taken a toll. Work pressure, financial stress, changing relationships and traditional expectations around masculinity can quietly wear men down, often without clear warning signs. In season three of the Visibility Gap, Dr. Guy Winch and his guests explore how these pressures show up, how to spot them earlier, and how men can access meaningful support. Listen to the new season of the Visibility Gap, a pod presented by Cigna Healthcare.