Lyft (LYFT) 10 Feb 212020 Q4 Earnings call transcript

Good afternoon, and welcome to the Lyft Fourth Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode to prevent any background noise. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the conference over to Shawn Woodhull, Head of Investor Relations.

begin. may You

afternoon, for Good to Lyft the Thank quarter and ended call the December earnings you. welcome XX, XXXX.

to future differ statements that growth projected from statements included unknown prospects, matters. These known as risk our to subject uncertainties Co-Founder or on risks Relations those shortly Green; of this Joining during initiatives our and call. as factors Financial Officer, Zimmer; results Investor regulatory today discuss call materially A and well Chief results after me recording are Roberts. actual key In and regarding to particular, are and this the described our investor.lyft.com, and those will in and website Co-Founder Logan implied cause and could overall conference our at by well and third Brian CEO, in XXXX XXXX, will President, XX, you our filed the on take call statements the and November John that of Lyft’s economy. full business ended. results impact be guidance, financial XXXX, remind like X, our COVID-XX quarter opportunity and uncertainty for that this performance XX-Q making the in in filed XXXX, year relating Form including the and business, continuing markets pandemic, expected during be to we statements, of this strategy, be has the will of as long-term call, the future XX-K our for current expected as to March Form the I’d available business, forward-looking to unpredictability

required on and as to law. hereof, disclaims forward-looking events. as statements, based of the as predictions forward-looking on statements by obligation assumptions not future beliefs should You forward-looking are our any any that except make we call on statements, All date update unless this rely of

regarding results. be results in today isolation reconciliation historical in financial results, including substitute our or GAAP our to, a measures will to our considered now also our in co-Founder for, include conference be release, X-K measures. of Form Logan to at from filed as may to addition non-GAAP would be Green. call found discussion I turn SEC Officer, not non-GAAP furnished non-GAAP Information financial non-GAAP on should These was our and over our Investor which the a and Our Chief earnings today GAAP Relations investor.lyft.com. and like the with website may found with Logan? Executive Lyft’s

for and joining the Shawn. our in Thanks, XXXX, we for than we time our everyone. we’ve backdrop long-term. has position been past. made the significant Despite business at any progress difficult thank Good afternoon, today. stronger focused are in in And you The our a now improving call believe on I

our economics strong positioned coiled the as growth margin and drive unit we’ve expansion a Given and improvements to made cost like spring, hold. our tightly recovery we’re the takes structure, to overall organic

governments were Turning in to surged XX% were monthly rideshare trends mobility. restrictions, as December, uneven. state but rides Rideshare In XX% our and November. local year-over-year down limiting QX results. Ridesharing and were implemented in the October continued year-over-year down cases to and COVID-XX rides XX% rebound, people’s

able results. on our on impact acquisition and which demand, to a were positive spend, the effect Given incentive we financial reduce had driver

the QX the revenue early December, headwinds, at quarter sequentially in the said that our come of revenue outlook may pandemic grewXX% and of lower in towards the despite for our range. So, Recall end fourth was end range. we top that

revenue QX, examples. a The and counts and frequency led Texas recovery prior to in responses. there COVID-XX which higher across discussed West Now, reflecting mix region, trends America, per was remains in as we’ve record North towards the riders, on weakest in Separately, active rebounding generally Coast seen Florida rider. case vary as further while locally differences shift we’ve calls,

grew rider quarter-over-quarter active pandemic XX% growth overhang. In showed fact, despite positive and per the year-on-year, revenue

Let me now to January. shift

excluding based Brian in year-over-year, months holiday While QX, March. invest growth of expectations, will an XX% were to reflects the the does share improvement in growth positive supply month, and for the more February daily COVID-XX throughout details, rides prepare stronger current on week-on-week levels currently service improve but driver ride in down in demand week. to but still MLK average plan remain we The recovery anticipate in uncertain, the trend we rideshare beginning and QX. operating environment

the integrated of fully activities safely resume to side fuller other demand able the across rebound are come in a and range people a transportation we strong pandemic, network. of On together, our when anticipate

half to ready entertainment to we’re to time travel activities, individuals are support the we year, return when like of and taking leisure demand anticipated ensure this that second As the today in the comes. steps

predict reach rollouts trends, While we immunity or efficacy the current believe of U.S. could critical certainty, with can’t earlier the on timing vaccine we than many destinations. based international levels

that we within travel which primarily mentioned U.S., the occur well I result, capture. a positioned are As may the in leisure to pop

think, and and vision. attend these as-a-service, a believe to that is by and transportation I in friends, taking venues company all driving. without can of to sporting are are a I platform to is be get replace has ownership. drinking back that restaurants only take bars, long-term to transportation the go eager and discuss few minutes multimodal want to we events the can America people There see car Lyft, and We demand seamless normal. accessed North our to future And responsibly pent-up concerts.

to vehicles the ridesharing will autonomous this transform They industry transition. business. expect We their and accelerate

on will first Here’s generation we’re AVs be We believe how thinking about the deployed rideshare networks. this. of

one getting subset vehicles speed even, restrictions. point serve This too. every to trips regulatory break tricky be depend will issue technology able will first vehicle the AVs bumps be which will will condition. due to to domain every There Given because the can on It’ll take ride to are for to be weather time and advance able likely where be these vehicles utilization. of to key wave expected only cost, a AV accommodate under

rideshare is and ride, the by of network the able because This will industries. are nature is maximize we’re multimodal AV help of type utilization our dynamically AV. Because fulfilled trip suitable. route dispatch critical. we of and platform other AVs can Our an or to from deployment with match well-established because type in we a whether model riders demand, hybrid not aggregate it’s This

during be would analogy, of were the closer but valleys are of a subscribers parts during As new points they’ve mix other It scale introduced service. existing far carrier with consistent That still rolled of way, peaks network, is to XG, similar for happen carrier critical too mind wireless requires unable XG demand. XG a dynamic. network a works people XG supported if imagine will capture Early resemble static that a to to travel day. out This the carriers scale. value, if patterns because They base line. have can Keep service from by redundancy. large they heartbeat, on top XG spikes it away, typically it that our on or to any major horizontal be the and subscriber that levels day. having at be and what the deploy networks problem. could would tower morning Providing benefit not commutes, the daily carriers a in around access able evening allows the AVs on just Extending as to rideshare the model and infrastructure don’t network

ensures the penetration, rideshare AVs for to to We’ve supplement demand also to rider AVs. a AVs For of nine Also uniquely a advantage of to reach spikes, supporting is nationwide wide audience. virtually same footprint spent was and demand. serve be deployed years critical on broad service with potential consistent AVs of this increase the vehicles building we that operate. mobile expanding millions can that scaling fixed everywhere the riders, national that of roaming networks, seamlessly hybrid network to pool the We’ll business introduce is as a traditional able capable reason AVs

and a our network riders platform our to network, partners of and in our including help these Our stack, tackle shared drivers. our And algorithms, data-driven asset, technology program hardest capabilities. level will pricing greatest able be routing aggregate into platform scaled rideshare demand, the will of leverage taps dispatching X rideshare to to access open our Since some our problems partners we self-driving. and autonomy our rides have

management fleet operating additional drive will expertise as Our efficiencies, John discuss. will

We continued the our choice a is landmark investments kind its network, the deploy This network in We industry. are our we’ve AV the of our in our in XXX,XXX our platform facilitated way core industry. to Motional than Through on programs. our XXXX. In more on competencies plans deal of among autonomous vehicles already build with on partner XXXX first QX, be agreement made we cities in the we’ve Motional. in our fully autonomous multiple rides paid leading since announced to to and

We transportation broadly. ultimately about on AVs impact have our the and are excited transformative will industry on

our we revenue the Finally, position. focus to And in of growth our discipline remain on and our to us. significant market cost strengthen opportunity confident financial in ability address continues front

updates provide Brian performance path a provides and our John call on to I’ll business, to few review the Before the to turn profitability. over our details financial on

remain COVID-XX unparalleled. The and effects its pandemic Thanks, afternoon, far-reaching good Logan, and everyone.

reinstituted As case help cities counts other fourth in shelter-in-place measures the curfews orders, and states spread. slow surged quarter, the and to

December versus the year-over-year advanced decline third monthly to the in recovery in worsened, a fourth XX% with quarter quarter, rideshare November. XX% down versus in our while as trends Now, rides XX.X% improved of XX.X%

revenue uncertainty Given December. as engagement in contra the revenue. decline the in driver significantly and incentives month acquisition reduced and programs The expenses upside reductions Lyft in cut and of of classified drive helped demand,

of may December end in million end the $XXX $XXX at the million. compares range of fact, with to that $XXX revenue early fourth our updated approached top provided of range. outlook our lower In million initial quarter revenue This be the of

outperformance significant in QX, uncertain expenses. we reduced operating loss. a the reductions environment Given the adjusted EBITDA revenue The drove our in combined further with cost improvement

increased line the the details In number metrics. with of quarter I’ll points XX basis top fourth So, from let’s roughly the dive third the riders fourth start quarter, to the the active quarter. of million. by $XX.X into

reintroduced, the of a were COVID-XX restrictive measures decline absence as in impacted stronger lower control As riders of the activations prior well was to rider spread quarters. by growth from rider as frequency accelerating

rider normally revenue rider for end since limited active our However, Remember, near led of to these rider. dynamics revenue. additions there’s revenue active time to to generate record per new count only are help to these per any quarter dilutive riders the

higher riders. shared, this shift to led mix Logan frequency As a towards

above QX, rider the third $X in is increase an revenue $XX.XX, $XX.XX achieved which representing XX%. active reached of in So over per the quarter,

in million comparison, despite to a led the the XX% year. third fourth from $XXX the to by per of the The quarter in the rider versus in these pandemic, revenue increase quarter terms million, trends revenue up $X prior $XXX In increased exactly of quarter. year-over-year active combination fourth

move I earnings results items. with of before was in and note measures historical X-K million expenses want Now, and to for changes other revenue, GAAP the defined to from Form reconciliation indicated, SEC. non-GAAP non-GAAP Relations amortization sequentially QX follow contribution, is found XX% million regulatory our historical to unless to all furnished adjusted cost assets, by is exclude increased QX. stock-based otherwise statement revenue, compensation and release, exclude in income that website may to be which to filed that less contribution liabilities $XXX includes required today compensation-related select of on, I This Investor which our intangible our are insurance of on agencies as $XXX attributable periods. with available and A stock-based

For increased each year-over-year well XXX unique from by of XX.X%, revenue. basis, basis XX.X%. dollar XX.X% on and up incremental difference in significant from Contribution points $X.XX. the benefited between margin in in over our XX.X% QX. two windfalls increased even QX, revenue margin to and of Contribution above outlook a was Contribution margin growth QX QX despite contribution absolute

million engagement $XX As demand October December level average the in versus in acquisition and reduced November. and we declined, driver spend by

which Without to these benefit Second, created we contribution to Together, generated items our first margin. to our revenue XX.X% this will QX, net benefits, in between took create slight invest older car but to still of remarket reverse headwind contribution detail more benefit $X.X contribution used and advantage strong in have would and onetime will margin. to QX outlook I a Flexdrive a margin the a above these market million in of QX to contribution. benefit provide which driver QX shortly, we quarter vehicles, QX XX%, plan been XX.X%. supply

versus confident third the book of that the experience. COVID-XX we for million impacted auto mined is firms related on any the liabilities of in of quarters with cost year, periods. potential regulatory and prior the with from to changes adverse after the the end COVID management XX% excludes XX% law insurance conditions of onset drop shrink In while claims, historical rides. contribution our of reconsidered last or attorney is the our reminder, a representation of representation fourth historical That COVID-XX, accident of cases impact by As agencies to that legacy liabilities. which share risk in claims trends the The XXXX. are the the After new with created development second required of there development, legal experience periods we and the for higher quarter, was insurance as adverse adverse onset older pleased associated to did development to said, plaintiff bodily of liabilities attribute COVID-XX. We remain injury associated matters primary attributable the strategy. given not increased for approximately $XXX XXXX auto we

insurance of of with For percentage XXXX, advantages deep fourth have we XX% strategic In was to future cost handling volatility. primary help QX. quarter, revenue the than as ending a than lower year experience claims and transferred the policy to reduce competitive insurance insurance risk September more the partners rideshare

even Finally, held our the with development accounts primary QX through as period December after adverse cash investment XXXX. approximately the in over-collateralized associated XXXX of and our remain liabilities, insurance we charge, XXst, of of QX against X% restricted

QX, operating expense XX.X% to flat for down $XX support percentage down expenses. was in in with R&D to revenue XX% QX move from a was and roughly Let’s QX. Operations declined Operations million, expense and XX.X% of expense QX year-over-year. support QX. as $XXX million,

in percentage declined of as XX.X% As R&D expense revenue, was marketing a QX, down in percentage revenue, QX, in of to XX.X% Sales a XX.X%. from QX. and

to classified expense million over from of terms sales G&A XX% In QX, declined sales QX total expenses. $XXX expenses million X.X% decreased was or XX% down million from below in declined a million QX on reduction. of G&A $XX quarter-on-quarter by between over was $XXX declined $XX in only representing Incentives, $XX and revenue period. a year-over-year decreased $XXX or revenue. to QX QX from year-over-year of million not basis XX% is down absolutes, marketing, to QX operating from as and Relative million, QX in million. million $XX annualized marketing $XXX In by in of expenses X% $XX year-ago as million figure. fourth the reduced QX, $XXX the by XXXX summary, expense XXXX, On in an cost Operating This operating million quarter. in basis, expenses of in QX, roughly a of million XXXX. and we $XXX

cash better loss of of EBITDA was meaning terms line, our We loss bottom QX came equivalents between again were than million adjusted unrestricted cash, at million XXXX outlook. $X.X $XX on the loss which $XX with our On nearly of our of Total was by adjusted sequential million. EBITDA QX, short-term revenue a adjusted loss in growth the and million. and $XX In CapEx, approximately our XX% CapEx We XXX improved $XXX disciplined dollar each by ended quarter basis, EBITDA billion $XXX for improved million, incremental cents. investments.

Now, remains the uncertain. near-term looking forward, still outlook

I what severe the unpredictable year know We are across will and are QX current remember, any results in recommendations, us pleased communities mind the near comping highly And first than fewer fully that reopenings benefit predict quarter. cities, significant let QX QX, but States fluidity Chicago and a is versus in as two though, for confident impossible a a we can have with impact about we it term, associated can and to day. Coast. and Weather in XX in Also, storms comparisons, health is rebound quarter. first don’t impact East the the leap cities share and widespread vaccinations orders certainty XX. included has the well days the variability an year-over-year when and as reopen, begun from our given will down seen care with among are government for In storms shut that for that be. that from rides. when keep United But recently we in Canada that me We’ve

ride trends, month-over-month, mentioned, terms consistent December. week-on-week throughout we which is positive year-over-year except a basis, a improved from October slight before In the in MLK below growth for as but rideshare were level an were on of January improvement in spiked. Logan January, basis, Rideshare XX% January rides count case down rides week. X% experienced intra-month On reached

volume of in forecast difficult any average we generally confidence. to be daily January’s expect down rideshare X% we ride in us improving assuming QX, QX the rides While XX line, improving will is apply average extremely grow quarter-on-quarter. February the it rideshare volume further daily QX, number March. ride see trend days line with to If for trend expect we in But rides an will a and to

on in based rideshare year. QX to overhang or implies rides that XX%, impact down QX the This results be rides in decline we given of pandemic of of versus QX. rideshare mind estimate March slightly a our that improvement the XX% Keep XX.X% So, an could in began to QX remaining COVID-XX, in significant year-over-year recovery, last QX. to modest a flat relative

at fast expected major forward a we to pandemic the and of since just began. you If on figure. quarter-over-quarter isolate to March, rides we half time both basis a quarterly decline increase, the less first point year-over-year hit of for and rides QX, the inflection month expect than will with the Then

me Let revenue. address now

will prepare to QX, prepare As is will spend realized invest reduced and This demand beyond. of QX. It important accelerate for to reported levels December. QX supply stronger in to acquisition the $XX to driver to QX when improve and revenue we create reverse million in driver the us a and we benefit a $XX I’ve we recovery, In do investments. in service described, engagement million in headwind for and for

headwind faced In sequential bikes addition, of and we scooters. a

The and weather. first quarter bikes for is scooters, given the weakest

at We be provide despite QX quarter. This ride the guidance, expect throughout we year-over-year outlook QX, So, for decline investing reported to XX% position million to the $XX to XX% we We strategic decline of in down be stronger revenue negative with QX. a revenue least XXXX. while growing a to believe rebound. revenue momentum quarter is in the translates formal growth to the relative Lyft QX decision that supply in cannot $XX versus should right last XX% to QX million in by anticipate

expect COVID-XX. We by the revenue year-over-year exceptional full growth to generate we comp QX first in begin as impacted quarter to

We continue and growth significant in expect as QX well. organic to QX

operating to for expense recovery. the while strong Given driving leverage, on focus environment, a continue we we invest

and QX we this to range significant inclusive $XXX the in loss expect EBITDA barring We manage that can between million our is three headwinds. pandemic, of $XXX adjusted a to million, change

First, $XX this $XX in to million includes driver million the loss investment supply.

and realize Second, incremental $X and cost to fixed we QX expect to demand. given loss scooters, bikes a lower million related

the the in headwind tax also first quarter, payroll at always outlook faced this nearly year, Finally, sequential the estimate million. impact of includes which we $XX this

relative EBITDA adjusted million our million to to range of million headwinds includes million $XXX between of to $XX $XX loss QX. So, $XXX

will supply. margin expect in driver contribution reduced margin QX to We contribution XX.X%. by an investment approximately $XX of be million QX to up XX% will be

we we as record expect profits be in drive margin by remarketing an and this later QX a can all-time base, will margin bike as contribution improvements year. contribution and decline QX seasonality. scooter this Additionally, well From achieve impacted

remove relative a Last to we original expense annualized costs million outlook. move our leverage. to fixed let’s had So, to $XXX goal in year, QX

results achieved and $XX report further a that done. as in to savings impact. relative to to expense reduce approximately We to we reduction expenses quarter even by QX to below And increase pleased million In not cost we the this significant we’re first through we this investments. of are million, beat deliver R&D demonstrate and expect our target as G&A QX, forward, $XXX look revenue by reduction, QX. relative a QX, we We XX% plan

improve supply a basis we can sequential expense driver So, confident investments, from despite we our leverage. on additional are adjusted or loss slightly our EBITDA this through headwinds maintain

expense QX our points Let me quarter as and provide path visible reduced of which an on our plans update profitability. to The our we’ve the base. to proof extent serve for fourth

Given by of able we’ll cost be more the EBITDA to lower we’re impact profitability that achieve our efficiencies and structure, new adjusted QX. even confident

require the a based we a we’ve profitability rebound. is summer in chance fact, in In pulling on can there Obviously, would improvements QX. made, achieve strong profitability

However, now this the the increase is confidence. fact QX investor even possibility a in timeframe that should

while delivery in fund to profitability milestone, super are disciplined want growth. over important in long-term BXB be new strategic process, we and clear drive to expand an we despite like our that being is our initiatives investments Finally, also continuing budgeting TAM time to

and investor early John balance in leaning these in thoughtfully especially versus days. growth Logan more while we As shared investments deliberately towards profitability, in will letter, original their growth,

So, while shareholder year, opportunities are we of we growth create are intent sight on losing that achieving adjusted not value. EBITDA profitability this

So, in to points. closing, two I want key emphasize

First, leverage. significant we operating expect generate to

leverage cost achieve and and demonstrate as profitability been and in operating increase adjusted expense driving we reductions confidence further are to to efficiencies quarter right our achieve in ride increase in strong executing our unit and initiatives investor returns. expectation that we economics the the on we volume investing XXXX. We’ve should expect that success path to in EBITDA leverage fourth QX Our

expect that it structurally industry lead more and will we Lyft side emerge of going So, pandemic, the remain on profitable to the was profitable in margins. ride of in, more terms the confident long-term than other per

transportation strong a Second, a we excess generate rebound, which Lyft provides as to well-positioned focus. revenue in growth in In is a long given trillion, XXXX, runway. the our pure-play $X growth organic TAM expected have of

growth have from to underpinned structural growth by one. beyond, the the expect in and secular and our XXXX that continued drive fueled long-term also recovery in We solid day trends

with key over a to John let that, few turn it provide me So, updates on to business. the

past resilience team’s significant year. and we’ve made of Thanks, of over Brian. proud the the the I’m progress

to do across our across about and fleet I to of am I’d very multiple business. integral well cycle. capabilities. confident be efficient scale, we’ll we start, America. vehicles, organic serviced, need takes manage long-term There as of repaired, critical partners. the hold. navigate extremely three of powered capabilities. pandemic, centers, talk To the elements: field a our three, strong among hybrid on economics services, are able marketplace why growth like to by an competitive add value These By efficiency operations key which that to fleet I’d to efficiently as us deliver network and build choice reflects AV like offering continue programs, moat to stored platform, be two, our management a comments positioned drive human And we enabling and to recovery thousands efficient partner cars fuel Logan’s will This long-term to Even we about reinforcing in managed are to service that the management fundamental drivers; our highly of improved are value our be even technology; more means management they’ll AV expect more these Each begin all set and elements growth. to fleet as and monitored. number number already the we creates North our of includes the of our self-driving maintained. part we engine our Today, customers comprehensive First, and a work that technology-enabled operations services

incredibly Our today strategy well, and works tomorrow.

more-clear. of AVs, And advantages competitive advance AVs. Our with can even cash flows our become management fleet offerings strong in will deliver

highest per our For the mile, while network will our will hybrid drive the fleet cost revenue support expect AV lowest partners, per mile. operations we

mentioned, the of is as-a-service. Logan As future transportation

platform investments of are focused making. to are vision long-term deliver of because this and on We the positioned of best we today because the our strength

engineering expertise, our All been we’ve to of efficiencies. drive powered this which by using increasing science data is and

this continuing we more on We point as the competencies. lean line delivers and a invest core believe cost to serve value are while new key partners long deliveries our lowering riders will our differentiation operating. We that BXB continue in will The strategically to into drivers, of also like platform run. to is, bottom over the of focus initiatives that build

California. brief XX let me update in that of On win the public Proposition the policy a result initiatives a front, provide are on

also As of earnings the December while as flexibility wherever whenever, and XXth, drivers they want. as guarantee a retaining minimum to began often drive receiving

has have In average now health during policy the the drive an event additional medical a number Every of hours addition, they care driver and earn California that contribution, to drivers their quarter. covers now on ability bills insurance based loss the passengers introduced accident. ride in also state. help Driver that Prop and we cost drivers provide transparency an Lyft Benefits of recently the in each offset earnings to Fee To applies XX the riders, of to California to a these initiatives and the taken

with We continue along the turning future benefits independence in America, conversation California point in the outcome future to work view drivers in as a the the a around of want the with desire. they

policies. coverings now December, to governors includes the frontline high markets. priority out In provide tiering now achieved essential we’ve with like enforcement we’re began safety reaching technology This to to to conversations our We policymakers on of new health and And policymakers doubled we some to being doing by state implementing drivers for used in to riders, for advocate recognition our local drivers support transportation I’d and topic. and further initiatives. face drivers multiple strengthened highlight engage status productive priority this on and receive We’ve down vaccines drivers federal are workers. as in continue for to we’ve ensure and to mask riders. work

cost that product customers and This and We’ve building and dispatching savings Lyft. been to more and delivers addition, drives for our innovation drivers value introduce we’ve for technology. continued riders. In more own our mapping to experience improvements

side shortens of on of accuracy now same meet help we’re the example, better able reduces the trip and and For ETA rides. certain street, times, to drivers improves riders which the cost

transitioning universal strong team inroads to interest of impact commutes. like get pandemic see work. win Another our us In enterprise multimodal and vaccination is processing validate provide driving our of goal over the addressing continues update is and with couple addition These use by will to are our through solutions majority employees at-risk experience recovery. to riders million and focus uninsured XXXX. to bikes of a employee on the creating help billing in a and a adoption vaccine leverage QX, facilitate line. we supporting In are door cases, rides course engaging that and from XX a daily agencies Quick on rebound. bottom the around user collectively just innovation the by are opened program meaningful the we to on I’d the the the both, rideshare, December, sites, government to to forward The have to examples we and to announced more a to ways payment about continued helping increasingly space. with Corporations and the corporate our business we low-income, scooters these strong new communities access approach. communities. close on with to from use This to of

JPMorgan COVID-XX insecurity, vulnerable We Inc. along communities. the Chase, especially United are seniors transportation and of Anthem and for lead other coalition with to organizations. with amplified working Way has this effort,

access. We are that committed transportation to ensuring

ready this barrier We to access virus. transportation that ensuring to now are committed we’re is With questions. take a to beating that, not

first sir. Doug question [Operator our I Anmuth Please go ahead. Thank line of the Instructions] JP comes from you, show Morgan. from

or Logan Great. then for John, for One Thank one you. and Brian.

the be different, First, get comes it question when rideshare will how back. often just we of

XX% the your ‘XX be the curious over on just Brian, in to or comments. And on gross all think really the key margin years their just changes pointing couple I last competitors about then, XX% long-term of quantifying at think view late wanted your Thanks. I to long-term versus ‘XX, into or relative clarify beyond differences So, to in will numbers? cost structure. and margins Are the you business in the if just what hopefully EBITDA you the on margin margins

Hey Doug. take All part. right. first I’ll that

thing So, all, cities, there how change. everybody that’s a kind may dead of about first there’s how a One may hype and lot of think I hogwash are out -- world the cities leave of of there’s going I about talk to talking about cities. just is lot not or

and people, ambitious makes leave, cities. you’ll decide influx see an people it some when folks, moving other think, to of for I younger to creative people room folks,

on of disasters, you stronger There has wars, come have pandemics after the history, one, economic at steady And than in ever. past. urbanization. each arc a back broader look the world march If towards the cities been been

having So, that long change term. kind of I on business an our foresee impact don’t

definitely than pre-COVID is second The to trend. I key a not line. never thing talked on our business I is the even more one stay. And to We work-from-home when was is demand are the the our business commute often that piece about demand-constrained. are understand But, a opening of think, right? how about remarks think of about patterns we flat heartbeat elements demand-constrained, in supply-constrained, high, demand are like kind here

fragmented long to setting I our we’re the pandemic the transportation-as-a-service what and to are will from car I even that’s for being large model. ultimately out could opportunity we’re a But move kind ownership going near-term a think $X.X while business. positive ownership fix the little focus of impacts it’s on a think, intact, net-net transportation things I bit, and trillion of structural the of continue after, the So, to term, at going factors remain all out When going is broken of sort And if And ecosystem. move world be those people vast on to spent after. to what model that you away are towards a the look with this of think going car fragmented a on the business, obviously has modest really that that to ecosystem we’re majority that kind consumer of transportation-as-a-service market things. couple

So, let on margin. Brian jump I’ll the in

believe Sure. margins. lead on to the industry for we we will continue long-term Look, question. that Thanks, Doug, the

margins Amazon, Star, how flow’s terms is Near to same share we flow less is our operating the value. objective long-term believe free which the In aligned financial growth as increase. North shareholder flow we term, of And cash free with per long-term CapEx. share, metric to we expect and maximize most this cash to cash generate

our said achieve operating but would we record environment, year, what EBITDA I in to model. obviously we contribution just of prepared my leverage record which adjusted as of margin our in we’re As would say is results an -- will this I the margins all-time well. COVID, later because an uncertain we’re translate demonstrate improving remarks, And expect

on margins, we the while frame will time confident we’re or lead speculating are ultimate what So, reach. terms the of not that we industry in margins the long-term could

go comes UBS. next Sheridan I Please Eric our question show of from line from the ahead.

Maybe just taking commentary had a the remarks. step back you from all during the prepared

of irrespective that against the improving the part think As how how of in or the quasi sort that you more then the of should to want demand are would that see to how environment the evolves? need those Thanks the you so end-demand are investments are end you you investments be, would recovery And broader fixed second feel what to the to question are expect much. XXXX, look necessary about make make to tied XXXX? out business of investments we you and variable costs some and in

Sure.

then we we by of Logan, And QX and start. below to down related When between me free same this take let did a Eric, below revenue policy took lot and I disclosed, obviously, in cost million. down of add on. operating there revenue Prop we in OpEx $XX QX what elevated $XX -- to feel just QX. spend look expenses we as And was QX So, million XX of spend, cost for opportunities, at the it planning. now, of cost And to QX, a further terms in California. across mentioned, we it’s we And to XXXX of and that all have approached this philosophy did and facility the budgeted where we’ve But, of justify this zero-based it’s board the in et we around goes you our in headcount growth, unlocking is mindset centers. cetera. across how And it how budgeting this And unlocks. you really Company terms every expect dollar lots to T&Es, find is single

opportunities I volumes business. out still terms fact we that. of in The just that million we’re in another managing think speaks to the taking QX So, $XX see

flexible. we will invest remain terms want want We be to we look, In opportunistic. to growth. rebound, the of And as conditions in warrant,

we remain And more stronger QX. to in QX a over in strengthen much we then And of really to we see an want expect rebound. we point in of that inflection a the demand to sure terms and investing make the expect again, will we in of super but QX, strong so, course advance and the -- just QX in win supply be rebound want expect begin will to position flexible recovery of QX in strategically to we’re

a Yes. color. bit with little in I’ll jump more

recovery. lines. about, was on the challenges And of navigating every very you talking priority’s for rider, Brian two, time different top in sure ridesharing is one have our drivers what to and balance, biggest the marketplace Just creating making enough respond the

whereas supply turning So, more back. the Titanic, don’t drivers little more when and system we onto It’s like challenge, come can the And know -- that’s move faster. much a demand is takes the will time. that steering bringing demand real

And so, invest ahead bit the of we to curve. a need little

kind years could see to that’s We’ve there’s we and our We QX, huge than dividends expect made and up opportunities some R&D down for we’d And to and of of demand a to pick always-on spending think pay of to improvements lot in investing to costs, on be a energy lot driving the work just unit investments really come. be that for prepared dramatic of but still on -- our going are not. that but already and time opportunities. variable costs. we we always-on rather wrong, Back

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in So, value the driver of make terms amount is get second can rider to there. of of and Every from is system. to a the improvements the we get to to faster, dispatch like that in pricing, we huge can lot that leverage there a a mapping business things a

there’s will to invest quite we’re And more that that a we’re few be so, you term work. looking at. our But to good some able to what we longer investments like and BXB delivery that. heavily future-looking as gives sort as some well, hopefully, And of deliver making then, color

But, leverage is there profitable chance describing answer. to maybe QX. say what And us that provide in I’m be the Logan an to allowing going -- sorry, longer even is is can we is extended a

illustrative single that does is require to achieving ride which profitability a we obviously profitability contribution, absolute share Now, One by tied But, data more is, not impacted volume. would scenario. point is we quarter, growth QX QX. believe at start single-digit we could the beginning if in be expectations at rides second profitable month-over-month grew for current high of rate, based a on the

won’t Now, straight actual recovery obviously, be the line. this

in needed the achieve path we XX terms we to half. EBITDA last just of to leverage for level was volume. breakeven in original that profitability how QX see of to the quarter, volume percentage-point see fewer the ride profitability Logan is ride adjusted ride estimated just XX% to that we we to trying XX% of we improvement least the XX% describing the QX when XX% rides. leverage a back October now with with terms to We the This relative the previously, of of we’ve XXXX of stronger we’ve XX% a a created. And discussed when in XXXX, full an also to than at That’s to much first some second But, year shared opportunity the capture of XXXX. half of be benchmarks expect of XX%

of question next Stephen go ahead. Thank Ju comes you. line Suisse. from Please our Credit from show I the

Okay. Thank you.

deck, cannot through wording I So, on rolling you’ve the was at it if time going majority seeing reductions of can answer by on you primary unit new match to, like, new if your is And undone? announced the weigh future Logan, anything Brian, easily the the are in seems things on more transferred recovery? that first kind on units, announced be quickly margin I deals. the in very what insurance your around insurance you improvements the up to of seems you’re impact wording at contribution Thanks. as spend incremental already can have you I guess, the least the building risk you cost which Eric’s wondering quarter question, insurance agreements guess, will on the there rapid toward the you

Yes.

haul. the Just are on first part to cost the business in cost of long about we’re going most working on reductions, build think, to for a dig that the stronger your of reductions I question

cost type would experience, that of a attracts rider are savings of the we’re to we experience. the sort looking of value, cost So, They cutting look business the from that or drive types long-term better better unwind. driver not at drive a

if helps sure I’m So, answer that not the question.

change may kind I of QX more side. think, biggest bit we driver is a did the the where on invest that we’ve overall commented than in we little on

we market would But, mind kind can work, that of is So, think back something as consider I in respond driver of of to in conditions. needs we of we that QX, there’s demand top on our rest which and into, that far unwinding. as engagement nature to the much especially spend the lean of And return. kind more pulled dynamic likely nothing as we’re to see that is

Sure. Stephen, just question on and I’ll then that, insurance. let address Yes. expand And me your around

forced it unit went Company emerging leaders and economics, quarters are I straight to to took you reexamine We we teams, lasting when tap fast, grow the of and at people this increase throw last through a found it you new opportunities some When new growth these hit, that muscles. that ride the efficiencies, of had think, XXX%-plus that it’s changes. important period years. We COVID created to We year-over-year to XX business. make keep investments our merge and And mind studs, create in us growth. sometimes for problems. nonlinear year, down

million areas of even QX, below reduction. by this cost again, so, is reducing G&A revenue R&D relative to we’re And $XX to Logan we through investments QX, increase the in that as And tap primarily further described. expenses

volume in in grows, in. a expense this will but is move. cuts mind, we grow that’s are keep the further quarter as where leverage. ride absolute one So, G&A drive dollars not And to expect

a as of should decline. G&A So, percentage revenue

that, important a a we October of Now, basis transferred, auto risk mile to through in rates to QX XXXX. partners. per majority of the of on it’s And fixed on understand the insurance terms question, starting primary insurance slight are again, Xst,

in the Now, continue per monetization terms to increase financial impact, we can can of ride, we increase if margins.

from will Now, the year. expect QX margin contra again, we slight create headwind. driver investment this later impact supply report But the contribution revenue record to all-time

context I there. little so, And that more hope gives a

our next show Thill go I question from comes line the from of ahead. Brent Please Jefferies.

investments. more over you the For you that opportunities I’m and mentioned what BXB little a delivery next around the John, the curious in Logan or doing could if you’re expand just you year? see and drill

Sure. Thanks, Brad.

So, put we’re quite performance. excited together on we’re their excited about we’ve delivery, the team on tiger the about inbound we’re And getting. interest

handful a lives. have pilot market We of

We’re disclose specifics. to not planning

the So, strategy. on focus going to I’m

it about that mentioned, we it businesses existing our you a and BXB from capability doesn’t we’re on. they and compete drivers this direct-to-consumer What delivery. opportunity hearing customer local their scaled that the relationship. best see them leverages and part tech as loyalty a broadly clarity, for for as what community of good traffic that case, is to on organic same day need that The focused with want the these is So, use focus they is for logistics we’re

like we’re we’re and their forming marketplaces. them to type didn’t these of and made us more about this their world the what up delivery. we’re once with retailers and that to when everyone think likely about on systems for going the set ones have instead quite But, platform, even the these Many faster it obviously, bit what third-party and So, them I moving, on that their taught time more in partnerships, forward. time own they’ve mean a to these COVID of around of to could is breathe e-commerce midyear, had investments form jump and timing excited is terms to had talk for tech local

back, tightly the muscle on as spring, you studs, the on called Brian. a what comes about expense that you’re coiled this can demand that just can Logan’s To as you down a leaner for seeing being support quick And comment structure snapback. this support your like structure, follow-up to it it sounds

You’re not support return to going to growth? back have to fuel investments in the to that

to captured that Yes, this achieve XX%. current an contribution record you The I Again, think well. we year. is all-time later margin record it expect

we’re very-focused mindset. XXXX saying we planning, below So, then, went in this we’ve success And the excess of expenses cost XX%. in again, in had terms revenue, of terms zero-based budgeting of through of given

in for business. feel very overall terms we leverage the good of the So,

Thank you.

Benjamin Our Black ahead. Please question the from of comes ISI. Evercore next go from line

for questions. Thanks Great. the

moment? in you that to back partners? the year? And, second that about you the riders insurance, going evolves also the competitive supply ahead of invest how of going Thank And on the both, at it self-insurance your you your back transfer quarter, to expect remainder environment think to thinking about you. Just exposure? we the remaining and throughout over decision pertains how talk are to then, you as drivers time Should the driver maybe risk insurance can

Sure.

X.X% competitive So, just quite and question, year-over-year stable revenue XX% sales the in were specifically. that on in of as the of and mind classified Keep QX. environment the incentives first overall, has on incentives marketing part declined been

the if differentiating on a incentives. Brian, innovations So, product as And platform providing you as and take to better competing continue not part? far want experience, focus we’re we on compete goes, how through to second to our going

Sure.

at I when think, you So, go-forward. it’s our important look

technically to very the year. over safety October platform. different demand making, as to annual safest we make of sure starts out, So, that Xst pleased for leading of as our try have platform key well how and the date we’re RFP sort on just on number leveraging operational to changes of we’re drivers this progress the summer a the each who an changes locked again, this we When bid insurers see we initiatives year. really amongst the have our with effectively auto We September, we’re through were business

insurance basis, So, significant having XXX%, do value. in they again, own just their And having like, -- I again, bring on go-forward claims that see a it it’s helpful I a world-class administration partners provide to organizations it’s think, be I going assess can don’t year. local. world tend but we’re where more to every

best can possible. get with and game, teams. helping have create So, claims And professionally claims sort out across close these -- skin as the network it’s of of a States you as great to of United sort in efficiently here partners the the sort you as us

next Michaeli ahead. the comes of from Our Itay Citi. line question Please go from

AV for back to you all thank discussion, that there. A the couple going Just questions color earlier. of

as deploy interesting think opposed to roughly First, in cities your could that time. maybe as hoping it’s your was to see you routes in I about talk percentage expect as at that what decision one you in model on maybe could we maybe city well a the announcement of you to XXXX could if you and covered you be secondly, AV financial medium AV from talk little the as kind Brian, financial a then, from by about layering kind for the Motional And impacts deploy? about of bit maybe of impact the arrangement, term? think multiple how

first thanks. Yes, take I’ll question. of that part the

And and And pilots We and billions it’s easy initially, certain we’ve of from drivers. streets analyzed miles the up data there. scale most have conditions our weather. cities have will kind easier be navigate. easier ridesharing They in cities, of targeting have run grids multiple and the where the from traveled by start favorable to network and ridesharing we

that the to XXXX. think launch we’re to we’ll with on saying day. the go together launch multiple multiple have So, in we not But, cities expect capability we Motional, same cities

It’s Again, excited approve the about win we’re quite the and we’re to to this it about consumers that to course, up. the doing have will we’re going start able And of very regulators, that. itself, be scale before together. small. trust and technology So, is of going learning to

term, we’re over part So, long of in of to an terms not large this are at time. our point, be going and forecast this very-bullish the But, of to kind able business our of financials or we predict that course, is impact revenue. incredibly

leave it that. I’ll at So,

Thank you.

Yruma Edward Markets. KeyBanc line question next from from Our Capital the of comes

the promotions on two Really just again. driver

I I that of to subsidy. one there drivers the thinking stick know relates seen learning to concern trends to still two fact, extended still COVID as in headwind XX, tough of And opting some guess, you. drivers if, there supply kind a on any the terms have are they’re I enough but Thank you trying unemployment in are may you second, one? some it’s was happens it was to on when on networks then that As hit, again? get know aggregate hours days, Prop early whether network or I know, insurance. because that as about of

Sure. question. This is Thanks John. for the

As as it delivery to ask and related the of question, mentioned, always thing XX, similar to part relates are balance your coming demand because One drivers. delivery back in. Typically, supply Logan but is more note, necessarily of people drivers critical. wasn’t then doing things rideshare somewhat drivers and about than Prop

the quite earning of and as to out higher platforms about kind new rideshare coming gen see going to feel these of what we on come drivers So, COVID have for lead opportunities. that good we’re various about all

Prop to not As concerned. it relates XX, we’re

believe platform. include that health are And the are drivers we that benefits drivers, certain that actually into most the of from care and on the holistically. the bring with you benefits Prop that loyalty value to focus happy platform more coming incentives quite that the can value your as We’re subsidy drivers means driving in a highest part other XX having

we’ll a that, With call it right. wrap. All

the soon. again So, thank forward call joining everybody everyone staying healthy. we hope with And to We and talking you, is today. for everybody, look safe

you. Thank this conference and gentlemen, today’s participating. Thank you Ladies call. concludes for

now may Good disconnect. day. You