Uber and Lyft lost a lot of money in 2020. That’s not a surprise, as COVID-19 caused many ride-hailing markets to freeze, limiting demand for folks moving around. To combat the declines in their traditional businesses, Uber continued its push into consumer delivery, while Lyft announced a push into business-to-business logistics.
But the decline in demand harmed both companies. We can see that in their full-year numbers. Uber’s revenue fell from $13.0 billion in 2019 to $11.1 billion in 2020. Lyft’s fell from $3.6 billion in 2019 to a far-smaller $2.4 billion in 2020.
But Uber and Lyft are excited that they will reach adjusted profitability, measured as earnings before interest, taxes, depreciation, amortization, and even more stuff stripped out, by the fourth quarter of this year.
Ride-hailing profits have long felt similar to self-driving revenues: just a bit over the horizon. But after the year from hell, Uber and Lyft are pretty damn certain that their highly-adjusted profit dreams are going to come through.
This morning, let’s unpack their latest numbers to see if what the two companies are dangling in front of investors is worth desiring. Along the way we’ll talk BS metrics and how firing a lot of people can cut your cost base.