Lyft Inc.

11/05/2025 | Press release | Distributed by Public on 11/05/2025 16:21

Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the "2024 Annual Report"). As discussed in the section titled "Note About Forward-Looking Statements," the following discussion contains forward-looking statements that involve risks and uncertainties. Factors that could cause or contribute to such differences include those identified below and those discussed in the section titled "Risk Factors" and other parts of this Quarterly Report on Form 10-Q and in our 2024 Annual Report. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Our fiscal year ends December 31.
Our Business
Today, Lyft operates as a global mobility platform offering a mix of rideshare, taxis, private hire vehicles, executive chauffeur services, car sharing, bikes and scooters across 6 continents in select cities. Our established, scaled network of users is brought together by our robust technology platform (the "Lyft Platform") that powers rides and connections every day. Our Lyft mobile applications connect riders with drivers for on-demand ride services and supports a variety of other multimodal solutions.
Substantially all of our revenue is generated from our ridesharing marketplace, inclusive of taxis, private hire vehicles and car sharing, that connects drivers and riders. We collect service fees and commissions from drivers for their use of our ridesharing marketplace. We also generate revenue from licensing and data access agreements, the sale of bikes and bike station software and hardware, advertising services, riders renting through our network of shared bikes and scooters, drivers renting vehicles through Express Drive and by making our ridesharing marketplace available to organizations through our Lyft Business offerings.
Recent Developments
Acquisition of Freenow
On July 31, 2025, we completed the previously announced acquisition of Intelligent Apps GmbH (d/b/a Freenow), a European multimodal application with a taxi offering at its core. The acquisition marks Lyft's first expansion outside of North America, beyond bikes and scooters. Upon the close of the transaction, the Company paid approximately €204.1 million ($234.8 million)in cash, inclusive of closing adjustments. Refer to Note 4 "Acquisitions" to the condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding the acquisition.
Acquisition of TBR Global Chauffeuring
On October 14, 2025, we completed the acquisition of TheBookingRoomGroup Limited (d/b/a TBR Global Chauffeuring), a global luxury chauffeuring company. Upon the close of the transaction, the Company paid approximately £83.0 million in cash. Additionally, up to £17.3 million of contingent consideration may be payable upon reaching certain performance conditions. Refer to Note 16 "Subsequent Events" to the condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding this transaction.
Financial and Operational Results for the Three Months Ended September 30, 2025 and 2024
Three Months Ended September 30,
2025
2024
% Change
(in millions, except percentages)
GAAP Financial Measures
Revenue $ 1,685.2 $ 1,522.7 11%
Total costs and expenses
$ 1,662.1 $ 1,579.4 5%
Income (loss) from operations
$ 23.1 $ (56.7) 141%
Net income (loss)
$ 46.1 $ (12.4) 471%
Net income (loss) as a percentage of revenue
2.7 % (0.8) %
Net cash provided by operating activities $ 291.3 $ 264.0 10%
Net cash used in investing activities
$ (179.8) $ (6.7) NM
Net cash provided by (used in) financing activities
$ 187.9 $ (35.4) 631%
Key Metrics and Non-GAAP Financial Measures
Active Riders 28.7 24.4 18%
Rides 248.8 216.7 15%
Gross Bookings $ 4,780.4 $ 4,108.4 16%
Adjusted EBITDA(1)
$ 138.9 $ 107.3 29%
Net income (loss) as a percentage of Gross Bookings
1.0 % (0.3) %
Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) 2.9 % 2.6 %
Free cash flow(1)(2)
$ 277.8 $ 242.8 14%
___________
(1)For more information regarding our use of our non-GAAP financial measures and reconciliations of these measures to the most comparable GAAP measures, see "Non-GAAP Financial Measures".
(2)Free cash flow is defined as net cash provided by operating activities less purchases of property and equipment and scooter fleet.
NMNot meaningful.
Definitions of Key Metrics
Active Riders
The number of Active Riders is a key indicator of the scale of our user community.
We define Active Riders as all unique riders who have taken at least one ride during the quarter. If a ride is requested by another organization or person for the benefit of a rider, that rider is only included in the calculation of Active Riders if the ride is accessible in the rider's Lyft apps.
In the first quarter of 2025, we updated the definition of Active Riders to simplify the definition and better align the metric with future scaling of our business. Additionally, unique riders were previously identified by phone number and are now identified through a unique internal identifier. The change was adopted prospectively and periods prior to the first quarter of 2025 were not changed as the impact was not material.
The increase in the number of Active Riders in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was due primarily to our focus on rider and driver engagement, improved retention and overall marketplace health.
Rides
Rides represent the level of usage of our multimodal platform.
We define Rides as the total number of rides completed on our multimodal platform that contribute to our revenue. These include any Rides taken through our Lyft apps. If multiple riders take a private rideshare ride, including situations where one party picks up another party on the way to a destination, or splits the bill, we count this as a single rideshare ride. Each unique segment of a Shared Ride is considered a single Ride. For example, if two riders successfully match in Shared Ride mode and both complete their Rides, we count this as two Rides. We have largely shifted away from Shared Rides, and now only offer Shared Rides in limited markets. We include all Rides taken by riders via our Concierge offering, even though such riders may be excluded from the definition of Active Riders unless the ride is accessible in that rider's Lyft apps.
The increase in Rides in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was due primarily to our improved marketplace health, which resulted in an increase in Active Riders and increased ride frequency.
Gross Bookings and Adjusted EBITDA margin (calculated as a percentage of Gross Bookings)
Gross Bookings is a key indicator of the scale and impact of our overall platform.
We define Gross Bookings as the total dollar value of transactions invoiced to riders including any applicable taxes, tolls and fees, excluding tips to drivers. Gross Bookings also includes amounts invoiced for other offerings, including but not limited to: Express Drive vehicle rentals, bike and scooter rentals, and amounts recognized for subscriptions, bike and bike station hardware and software sales, media, sponsorships, partnerships, and licensing and data access agreements. Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) is calculated by dividing Adjusted EBITDA for a period by Gross Bookings for the same period. For the definition of Adjusted EBITDA, refer to "Non-GAAP Financial Measures".
The increase in Gross Bookings in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 was due to international expansion and Rides growth which benefited from continued improvements in marketplace health.
The improvements in net income (loss) as a percentage of Gross Bookings and Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 were due primarily to our focus on cost discipline as growth in Gross Bookings outpaced growth in total costs and expenses, along with Rides growth and improved marketplace health.
Components of Results of Operations
Revenue
Revenue consists of revenue recognized from fees paid by drivers for use of our Lyft Platform offerings, and from gross amounts collected from riders in certain markets where we control the transportation services provided, Concierge platform fees from organizations that use our Concierge offering, subscription fees paid by riders to access transportation options through the Lyft Platform, revenue from bikes and bike station hardware and software sales, revenue from licensing and data access agreements and revenue from arrangements to provide advertising services to third parties that are interested in reaching users of our platform. Revenue also consists of rental revenues recognized through leases or subleases primarily from our wholly-owned subsidiary, Flexdrive Services, LLC ("Flexdrive") and our network of bikes and scooters, which includes revenue generated from single-use ride fees paid by riders of our network of bikes and scooters. Revenue derived from these
offerings is recognized in accordance with ASC 606 and ASC 842 as described in Note 3 "Revenue" to the condensed consolidated financial statements as well as the Critical Accounting Estimates and Note 2 of the notes to our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2024.
We offer various incentive programs to drivers that are recorded as reduction to revenue if we do not receive a distinct good or service in consideration or if we cannot reasonably estimate the fair value of goods or services received.
Cost of Revenue
Cost of revenue primarily consists of costs directly related to generating revenue through our multimodal platform which primarily includes insurance costs, payment processing charges, payments to drivers in certain markets where we control the transportation services provided, and other costs. Insurance costs consist of insurance generally required under transportation network company ("TNC") and city regulations for ridesharing, and bike and scooter rentals and also include occupational hazard insurance for drivers. Payment processing charges include merchant fees, chargebacks and failed charges. Other costs included in cost of revenue are hosting and platform-related technology costs, personnel-related compensation costs, depreciation, amortization of technology-related intangible assets, asset write-off charges, incentives to drivers in certain markets where we control the transportation services provided, and costs related to Flexdrive, which include vehicle lease expenses and remarketing gains and losses related to the sale of vehicles.
Operations and Support
Operations and support expenses primarily consist of personnel-related compensation costs of local operations teams and teams who provide phone, email and chat support to users, bikes and scooters fleet operations support costs, driver background checks and onboarding costs, fees paid to third-parties providing operations support, facility costs and certain car rental fleet support costs. Bikes and scooters fleet operations support costs include general repairs and maintenance, and other customer support activities related to repositioning bikes and scooters for rider convenience, cleaning and safety checks.
Research and Development
Research and development expenses primarily consist of personnel-related compensation costs and facilities costs. Research and development costs are expensed as incurred.
Sales and Marketing
Sales and marketing expenses primarily consist of rider incentives, personnel-related compensation costs, certain driver incentives, advertising expenses, rider refunds, amortization of intangible assets and marketing partnerships with third parties. Sales and marketing costs are expensed as incurred. Incentive programs are intended to improve our marketplace. In the second quarter of 2025, we determined that certain components should be excluded from our disclosure of incentives. Accordingly, prior period amounts disclosed have been changed to conform to current period presentation.
General and Administrative
General and administrative expenses primarily consist of personnel-related compensation costs, professional services fees, certain insurance costs that are generally not required under TNC regulations, certain loss contingency expenses including legal accruals and settlements, insurance claims administrative fees, policy spend, depreciation, facility costs, amortization of intangible assets and other corporate costs. General and administrative expenses are expensed as incurred.
Interest Expense
Interest expense consists primarily of interest incurred on our convertible senior notes due 2025 (the "2025 Notes") and convertible senior notes due 2029 (the "2029 Notes"), as well as the related amortization of deferred debt issuance costs and debt discount for the 2025 Notes, 2029 Notes and 0% convertible senior notes due 2030 (the "2030 Notes"). Interest expense also includes interest incurred on our Non-Revolving Loan and our Master Vehicle Loan.
Other Income, Net
Other income, net consists primarily of interest earned on our cash, cash equivalents and restricted and unrestricted investments.
Provision for (Benefit from) Income Taxes
Our provision for (benefit from) income taxes consists of federal and state taxes in the U.S. and foreign taxes in jurisdictions in which we conduct business. As we expand the scale of our international business activities, any changes in the U.S. and foreign taxation of such activities may increase our overall provision for (benefit from) income taxes in the future.
We have a valuation allowance for our U.S. deferred tax assets, including federal and state net operating loss carryforwards. We expect to maintain this valuation allowance until it becomes more likely than not that the benefit of our federal and state deferred tax assets will be realized. However, based on our current and anticipated future earnings, our
management believes it is reasonably possible that sufficient positive evidence of sustained U.S. profitability may become available in the foreseeable future to reach a conclusion that the U.S. valuation allowance will no longer be needed. The timing and amount of the valuation allowance release could vary based on the level of profitability that we are actually able to achieve. A release of all or a portion of the valuation allowance would result in the recognition of certain deferred tax assets and a material income tax benefit for the period in which such release is recorded.
Results of Operations
The following table summarizes our historical condensed consolidated statements of operations data:
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
(in thousands)
Revenue $ 1,685,195 $ 1,522,692 $ 4,723,550 $ 4,235,739
Costs and expenses
Cost of revenue 927,221 888,255 2,725,829 2,463,135
Operations and support 131,424 117,462 355,192 336,238
Research and development 109,615 104,447 331,435 303,277
Sales and marketing 243,317 215,779 616,256 537,621
General and administrative 250,565 253,436 698,204 742,332
Total costs and expenses 1,662,142 1,579,379 4,726,916 4,382,603
Income (loss) from operations 23,053 (56,687) (3,366) (146,864)
Interest expense (4,742) (7,362) (15,924) (22,262)
Other income, net 25,804 50,941 113,710 133,941
Income (loss) before income taxes 44,115 (13,108) 94,420 (35,185)
Provision for (benefit from) income taxes (1,959) (682) 5,465 3,762
Net income (loss) $ 46,074 $ (12,426) $ 88,955 $ (38,947)
The following table sets forth the components of our condensed consolidated statements of operations data as a percentage of revenue:
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Revenue 100.0 % 100.0 % 100.0 % 100.0 %
Costs and expenses
Cost of revenue 55.0 58.3 57.7 58.2
Operations and support 7.8 7.7 7.5 7.9
Research and development 6.5 6.9 7.0 7.2
Sales and marketing 14.4 14.2 13.0 12.7
General and administrative 14.9 16.6 14.8 17.5
Total costs and expenses 98.6 103.7 100.1 103.5
Income (loss) from operations 1.4 (3.7) (0.1) (3.5)
Interest expense (0.3) (0.5) (0.3) (0.5)
Other income, net 1.5 3.3 2.4 3.2
Income (loss) before income taxes 2.6 (0.9) 2.0 (0.8)
Provision for (benefit from) income taxes (0.1) - 0.1 0.1
Net income (loss) 2.7 % (0.8) % 1.9 % (0.9) %
Comparison of the three and nine months ended September 30, 2025 to the three and nine months ended September 30, 2024
Revenue
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Revenue $ 1,685,195 $ 1,522,692 11 % $ 4,723,550 $ 4,235,739 12 %
Revenue increased $162.5 million, or 11%, in the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, due primarily to an increase of 15% in Rides and 18% in Active Riders, continued improvements in marketplace health and international expansion. Investments in driver supply, which are recorded as a reduction to revenue, decreased by $38.8 million for the quarter ended September 30, 2025 as compared to the same quarter in the prior year as driver supply on the platform benefited from organic growth and drivers spending more time on the platform.
Revenue increased $487.8 million, or 12%, in the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, due primarily to an increase of 15% in Rides as we benefited from continued improvements in marketplace health and international expansion. Investments in driver supply, which are recorded as a reduction to revenue, decreased by $86.3 million for the nine months ended September 30, 2025 as compared to the same period in the prior year as driver supply on the platform benefited from organic growth and drivers spending more time on the platform.
We expect revenue will fluctuate based upon factors such as ride volume, driver supply, pricing, incentives and seasonality specifically related to our network of shared bikes and scooters.
Cost of Revenue
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Cost of revenue $ 927,221 $ 888,255 4 % $ 2,725,829 $ 2,463,135 11 %
Cost of revenue increased $39.0 million, or 4%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was due primarily to a $65.9 million increase in insurance costs driven by increased ride volume and a $8.4 million increase in transaction fees driven by higher ride volume. The increase was offset by a decrease of $34.2 million related to restructuring events which impacted the third quarter of 2024, which consisted of (i) $13.4 million in fixed asset disposals, (ii) $10.8 million in other current assets disposals and other costs and (iii) $10.0 million in accelerated depreciation of fixed assets.
Cost of revenue increased $262.7 million, or 11%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was due primarily to a $273.3 million increase in insurance costs driven by higher costs per mile paired with increased ride volume. There was also an increase of $20.2 million in transaction fees driven by higher ride volume. These increases were partially offset by a $34.2 million decrease in restructuring costs in 2025 compared to 2024.
We expect to see cost of revenue increase in the near term on a year over year basis due to higher insurance costs driven by recent economic factors and the renewals of our third-party insurance agreements, but we expect total insurance costs will increase at a lower rate than they have historically as a result of a recently passed rideshare insurance reform bill, SB 371, which is expected to reduce our insurance rate in California.
Operations and Support
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Operations and support $ 131,424 $ 117,462 12 % $ 355,192 $ 336,238 6 %
Operations and support expenses increased $14.0 million, or 12% in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was primarily due to increases in bikes and scooters fleet operations support costs and rider and driver support costs.
Operations and support expenses increased $19.0 million, or 6%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was primarily due to increases in bikes and scooters fleet operations support costs and rider and driver support costs.
Research and Development
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Research and development $ 109,615 $ 104,447 5 % $ 331,435 $ 303,277 9 %
Research and development expenses increased $5.2 million, or 5%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was primarily due to an increase in personnel-related costs driven by increased headcount which was partially offset by a decrease in stock-based compensation.
Research and development expenses increased $28.2 million, or 9%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was primarily due to an increase in personnel-related costs driven by increased headcount and an increase in stock-based compensation.
Sales and Marketing
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Sales and marketing $ 243,317 $ 215,779 13 % $ 616,256 $ 537,621 15 %
Sales and marketing expenses increased $27.5 million, or 13%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was primarily due to an increase in costs related to our incentive programs due to investments in rider engagement, which increased by $20.1 million from $108.4 million for the three months ended September 30, 2024 to $128.4 million for the three months ended September 30, 2025.
Sales and marketing expenses increased $78.6 million, or 15%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was primarily due to an increase in costs related to our incentive programs due to investments in rider engagement, which increased by $57.9 million from $254.2 million for the nine months ended September 30, 2024 to $312.1 million for the nine months ended September 30, 2025. There was also a $16.6 million increase in rebates and rider refunds.
General and Administrative
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
General and administrative $ 250,565 $ 253,436 (1) % $ 698,204 $ 742,332 (6) %
General and administrative expenses were relatively flat in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. General and administrative expenses included a $21.5 million net decrease in certain loss contingencies related to legal and tax accruals and settlements and a $14.2 million decrease in stock-based compensation, partially offset by a $23.6 million increase in consulting and advisory costs. There was also a $13.6 million increase due to higher self-retained general business liabilities and personnel-related costs driven by increased headcount.
General and administrative expenses decreased $44.1 million, or 6%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decrease was primarily due to a $81.1 million net decrease in certain loss contingencies including legal and tax accruals and settlements, a $22.9 million decrease in stock-based compensation and a $12.0 million decrease in bad debt expense. These decreases were partially offset by increases of $37.2 million in consulting and advisory costs and $34.2 million in self-retained general business liabilities.
Interest Expense
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Interest expense $ (4,742) $ (7,362) (36) % $ (15,924) $ (22,262) (28) %
Interest expense decreased $2.6 million, or 36%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.
Interest expense decreased $6.3 million, or 28%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.
Other Income, Net
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Other income, net $ 25,804 $ 50,941 (49) % $ 113,710 $ 133,941 (15) %
Other income, net decreased $25.1 million, or 49%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The decrease was primarily due to an $11.0 million decrease in interest income and an $8.3 million decrease due to foreign currency exchange.
Other income, net decreased $20.2 million, or 15%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decrease was primarily due to an $11.0 million decrease in interest income and a $5.1 million gain on extinguishment recognized in the first quarter of 2024 related to the partial repurchase of 2025 Notes.
Provision for (Benefit from) Income Taxes
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change 2025 2024 % Change
(in thousands, except for percentages)
Provision for (benefit from) income taxes $ (1,959) $ (682) 187 % $ 5,465 $ 3,762 45 %
Benefit from income taxes increased $1.3 million, or 187%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024.
Provision for income taxes increased $1.7 million or 45%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024.
Non-GAAP Financial Measures
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 % Change
2025
2024
% Change
(in millions, except for percentages)
GAAP Financial Measures
Revenue $ 1,685.2 $ 1,522.7 11 % $ 4,723.6 $ 4,235.7 12 %
Net income (loss)
$ 46.1 $ (12.4) 471 % $ 89.0 $ (38.9) 328 %
Net income (loss) as a % of revenue
2.7 % (0.8) % 1.9 % (0.9) %
Net cash provided by operating activities $ 291.3 $ 264.0 10 % $ 922.2 $ 696.4 32 %
Net cash provided by (used in) investing activities $ (179.8) $ (6.7) NM $ 316.5 $ (323.9) 198 %
Net cash provided by (used in) financing activities
$ 187.9 $ (35.4) 631 % $ (511.4) $ (102.3) (400) %
Key Metrics and Non-GAAP Financial Measures
Gross Bookings $ 4,780.4 $ 4,108.4 16 % $ 13,432.9 $ 11,820.5 14 %
Adjusted EBITDA(1)
$ 138.9 $ 107.3 29 % $ 374.7 $ 269.6 39 %
Net income (loss) as a percentage of Gross Bookings
1.0 % (0.3) % 0.7 % (0.3) %
Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) 2.9 % 2.6 % 2.8 % 2.3 %
Free cash flow(1)(2)
$ 277.8 $ 242.8 14 % $ 888.0 $ 626.3 42 %
_______________
(1)For more information regarding our use of our non-GAAP financial measures and reconciliations of these measures to the most comparable GAAP measures, see "Non-GAAP Financial Measures".
(2)Free cash flow is defined as net cash provided by operating activities less purchases of property and equipment and scooter fleet.
NMNot meaningful.
Adjusted EBITDA and Adjusted EBITDA margin (calculated as a percentage of Gross Bookings)
Adjusted EBITDA is a key performance measure and Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) is a key metric, both of which our management uses to assess our operating performance and the operating leverage in our business. Because Adjusted EBITDA and Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) facilitate internal comparisons of our historical operating performance on a more consistent basis, we use these measures for business planning purposes. Net income (loss) is the most directly comparable financial measure to Adjusted EBITDA.
We calculate Adjusted EBITDA as net income (loss), adjusted for:
•interest expense;
•other income, net;
•provision for (benefit from) income taxes;
•depreciation and amortization;
•stock-based compensation;
•payroll tax expense related to stock-based compensation;
•sublease income;
•gain from lease termination, if any;
•costs related to acquisitions, divestitures and other corporate matters, if any; and
•restructuring charges, if any.
Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) is calculated by dividing Adjusted EBITDA for a period by Gross Bookings for the same period.
We sublease certain office space and earn sublease income. Sublease income is included within other income, net on our condensed consolidated statement of operations, while the related lease expense is included within operating expenses and loss from operations. We believe the adjustment to include sublease income in Adjusted EBITDA is useful to investors by enabling them to better assess our operating performance, including the benefits of recent transactions, by presenting sublease income as a contra-expense to the related lease charges within our operating expenses.
We exclude certain costs related to acquisitions including due diligence costs, professional fees in connection with an acquisition, certain financing costs, and certain integration-related expenses. These expenses are unpredictable, and depend on factors that may be outside of our control and are not reflective of our ongoing core operations. In addition, the size and complexity of an acquisition, which often drives the magnitude of costs related to acquisitions, may not be indicative of such future costs. We believe excluding costs related to acquisitions, divestitures and other corporate matters facilitates the comparison of our financial results to our historical operating results and to other companies in our industry.
For more information regarding the limitations of Adjusted EBITDA, Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) and a reconciliation of net income (loss) to Adjusted EBITDA, see the section titled "Reconciliation of Non-GAAP Financial Measures".
Free Cash Flow
Free cash flow is a measure used by our management to understand and evaluate our operating performance and trends. We believe free cash flow is a useful indicator of liquidity that provides our management, board of directors, and investors with information about our ability to generate or use cash to enhance the strength of our balance sheet, further invest in our business and pursue potential strategic initiatives.
We define free cash flow as net cash provided by (used in) operating activities less purchases of property and equipment and scooter fleet.
Free cash flow has certain limitations, including that it does not reflect our future contractual commitments and it does not represent the total increase or decrease in our cash balance for a given period. Free cash flow does not necessarily represent funds available for discretionary use and is not necessarily a measure of our ability to fund our cash needs. For more information regarding the limitations of free cash flow and a reconciliation of net cash provided by (used in) operating activities to free cash flow, see the section titled "Reconciliation of Non-GAAP Financial Measures".
Reconciliation of Non-GAAP Financial Measures
We use our non-GAAP financial measures in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies, and to communicate with our board of directors concerning our financial performance. Our definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Furthermore, these measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our condensed consolidated statements of operations that are necessary to run our business. Thus, our non-GAAP financial measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.
We compensate for these limitations by providing a reconciliation of our non-GAAP financial measures to the most directly comparable GAAP financial measure. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view our non-GAAP financial measures in conjunction with the respective most directly comparable GAAP financial measures.
Net income (loss) is the most directly comparable financial measure to Adjusted EBITDA. The following table provides a reconciliation of net income (loss) to Adjusted EBITDA (in millions):
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Net income (loss) $ 46.1 $ (12.4) $ 89.0 $ (38.9)
Adjusted to exclude the following:
Interest expense(1)
5.8 8.9 19.5 26.7
Other income, net (25.8) (50.9) (113.7) (133.9)
Provision for (benefit from) income taxes
(2.0) (0.7) 5.5 3.8
Depreciation and amortization 33.8 45.1 98.0 115.2
Stock-based compensation 66.6 89.0 241.8 254.8
Payroll tax expense related to stock-based compensation 2.4 1.7 10.2 13.3
Sublease income 0.3 0.9 0.5 3.0
Costs related to acquisitions, divestitures and other corporate matters
11.6 - 24.0 -
Restructuring charges(2)
- 25.8 - 25.8
Adjusted EBITDA(3)
$ 138.9 $ 107.3 $ 374.7 $ 269.6
Gross Bookings $ 4,780.4 $ 4,108.4 $ 13,432.9 $ 11,820.5
Net income (loss) as a percentage of Gross Bookings
1.0% (0.3)% 0.7% (0.3)%
Adjusted EBITDA margin (calculated as a percentage of Gross Bookings) 2.9% 2.6% 2.8% 2.3%
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(1)Includes $1.1 million and $3.6 million related to the interest component of vehicle related finance leases within cost of revenue in the three and nine months ended September 30, 2025, respectively. Includes $1.5 million and $4.4 million related to the interest component of vehicle related finance leases within cost of revenue in the three and nine months ended September 30, 2024, respectively. Refer to Note 9 "Leases" to the condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for information regarding the interest component of vehicle related finance leases.
(2)In the three months ended September 30, 2024, we incurred restructuring charges of $13.4 million of fixed asset disposals, $10.8 million of other current assets disposals and other costs and $1.5 million of severance and other employee costs. Restructuring related charges for accelerated depreciation of fixed assets of $10.6 million are included on its respective line item.
(3)Due to rounding, numbers presented may not calculate precisely to the totals provided.
Net cash provided by operating activities is the most directly comparable financial measure to free cash flow. The following table provides a reconciliation of net cash provided by operating activities to free cash flow (in millions):
Three Months Ended September 30, Nine Months Ended September 30,
2025 2024 2025 2024
Net cash provided by operating activities
$ 291.3 $ 264.0 $ 922.2 $ 696.4
Less: purchases of property and equipment and scooter fleet
(13.4) (21.2) (34.2) (70.1)
Free cash flow(1)
$ 277.8 $ 242.8 $ 888.0 $ 626.3
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(1)Due to rounding, numbers presented may not calculate precisely to the totals provided.
Cash Flows
The following table summarizes our cash flows for the periods indicated (in thousands):
Nine Months Ended September 30,
2025 2024
Net cash provided by operating activities
$ 922,213 $ 696,371
Net cash provided by (used in) investing activities 316,458 (323,879)
Net cash used in financing activities (511,369) (102,301)
Effect of foreign exchange on cash, cash equivalents and restricted cash and cash equivalents 880 (67)
Net change in cash, cash equivalents and restricted cash and cash equivalents $ 728,182 $ 270,124
Operating Activities
Cash provided by operating activities was $922.2 million for the nine months ended September 30, 2025, which consisted of net income of $89.0 million adjusted for $288.4 million of non-cash items, and changes in working capital of $544.9 million. Net income (loss) improved from $(38.9) million for the nine months ended September 30, 2024 to $89.0 million for the nine months ended September 30, 2025 as a result of increased revenue and continued cost discipline. Non-cash adjustments primarily consisted of stock-based compensation expense of $241.8 million, which decreased year over year, and depreciation and amortization expense of $98.0 million. The changes in working capital were primarily driven by insurance, which saw (i) an increase in our insurance reserves due to a rise in commercial auto insurance rates on a per mile basis compared to prior periods, paired with an increase in ride volume in 2025 compared to prior periods, (ii) an increase in insurance related accruals and (iii) a decrease in insurance related assets primarily due to amortization. There also was an increase in accounts receivable due to an increase in ride volume related to Lyft Business, a decrease in our operating lease liabilities related to ordinary payments for our real estate operating leases, and a decrease in certain loss contingencies including legal accruals.
Cash provided by operating activities was $696.4 million for the nine months ended September 30, 2024, which consisted of a net loss of $(38.9) million primarily offset by changes in working capital of $423.0 million. The year over year improvement to net loss for the nine months ended September 30, 2024, from $(314.0) million to $(38.9) million was a result of increase in our revenues and the actions we have taken to reduce our operating expenses. Net loss was also offset by non-cash adjustments for stock-based compensation expense of $254.8 million, which decreased year over year due to a reduction in headcount driven by the restructuring activities initiated in prior years, and depreciation and amortization expense of $115.2 million. The changes in working capital were primarily driven by insurance, which saw (i) an increase in our insurance reserves due to a rise in commercial auto insurance rates on a per mile basis compared to the prior year, an increase in ride volume in 2024 compared to previous periods and strategic risk management decisions to retain additional risk in certain markets, (ii) an increase in accounts payable which was primarily due to the timing of insurance claim payments and (iii) an increase in insurance-related accruals. There was also an increase in certain loss contingencies including legal and tax accruals. These were partially offset by (i) increases to prepaid expenses for deposits related to our annual insurance renewals and (ii) a decrease to our operating lease liabilities related to ordinary payments for our real estate operating leases.
Investing Activities
Cash provided by investing activities was $316.5 million for the nine months ended September 30, 2025, which primarily consisted of proceeds from sales and maturities of marketable securities of $3.0 billion and sales of property and equipment of $43.1 million, partially offset by purchases of marketable securities of $2.5 billion, cash paid for the acquisition of Freenow of $202.9 million, net of cash acquired, and purchases of property and equipment and scooter fleet of $34.2 million.
Cash used in investing activities was $323.9 million for the nine months ended September 30, 2024, which primarily consisted of purchases of marketable securities of $3.0 billion partially offset by proceeds from sales and maturities of marketable securities of $2.7 billion.
Financing Activities
Cash used in financing activities was $511.4 million for the nine months ended September 30, 2025, which primarily consisted of repayment of our 2025 Notes of $390.7 million, repurchase of Class A common stock of $400.0 million, taxes paid related to net share settlement of equity awards of $95.7 million, repayment of loans of $47.9 million and principal payments on finance lease obligations of $30.8 million. This was partially offset by $500.0 million in proceeds from the issuance of our 2030 Notes, reduced by expenditures of $42.0 million related to the purchase of capped calls and $11.3 million in payments of debt issuance costs.
Cash used in financing activities was $102.3 million for the nine months ended September 30, 2024, which primarily consisted of repayment of loans of $61.8 million and principal payments on finance lease obligations of $35.4 million. This also included a net cash inflow of $0.2 million related to transactions related to the issuance of our 2029 Notes which included $460.0 million in proceeds from the issuance of the 2029 Notes and expenditures of $350.0 million related to the settlement of the 2025 Notes, $50.0 million related to the repurchase of Class A common stock, $47.9 million related to the purchase of capped calls and $11.9 million in payments of debt issuance costs.
Liquidity and Capital Resources
As of September 30, 2025, our principal sources of liquidity were cash and cash equivalents of approximately $1.3 billion and short-term investments of approximately $686.6 million, exclusive of restricted cash and cash equivalents and restricted investments of $1.8 billion, and a revolving credit facility in an aggregate principal amount of $420.0 million as described below. The portion of our cash and cash equivalents that is not invested is held at several large financial institutions and our investments are focused on the preservation of capital, fulfillment of our liquidity needs, and maximization of investment performance within the parameters set forth in our investment policy and subject to market conditions. The investment policy sets forth credit rating minimums, permissible allocations, and limits our exposure to specific investment types. We believe these policies mitigate our exposure to any risk concentrations.
On November 3, 2022, we entered into a Revolving Credit Agreement with certain lenders which provides for a $420 million senior secured revolving credit facility (as amended to date, the "Revolving Credit Facility") maturing on November 3, 2027 or February 13, 2025, if, as of February 13, 2025, our Liquidity (as defined in the Revolving Credit Agreement) minus the aggregate principal amount of the 2025 Notes outstanding on such date was less than $1.25 billion. Our Liquidity (minus the aggregate principal amount of the 2025 Notes outstanding) was not less than $1.25 billion as of February 13, 2025. As such, the Revolving Credit Facility did not mature on such date based on the terms of the Revolving Credit Agreement. We are obligated to pay interest on loans under the Revolving Credit Facility and other customary fees for a credit facility of this size and type, including an unused commitment fee. The interest rate for the Revolving Credit Facility is determined based on calculations using certain market rates as set forth in the Revolving Credit Agreement. In addition, the Revolving Credit Facility contains customary covenants, including restrictions on payments such as cash payments of dividends. The Revolving Credit Facility provides for borrowings up to the amount of the facility, with a sublimit of $168 million for the issuance of letters of credit. We entered into Amendment No. 1 to the Revolving Credit Agreement on December 12, 2023 and Amendment No. 2 on February 21, 2024 and such amendments amended the existing agreement to, among other things: (a) solely for the purposes of the financial covenant test, replace total leverage with total net leverage, which allows us to subtract the lesser of (i)(x) to the extent free cash flow for the most recently ended trailing four quarters is greater than $100.0 million, $300.0 million and (y) otherwise, $200.0 million and (ii) the amount of unrestricted cash and cash equivalents (as defined in the Amended Agreement) on our condensed consolidated balance sheets as of the calculation date and (b) permit us to repurchase up to a specified amount of our common stock with the proceeds of a convertible note offering. The Revolving Credit Facility also contains certain customary events of default.
In February 2024, we completed an offering of $460 million aggregate principal amount of the 2029 Notes in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. We used (1) approximately $350 million of the net proceeds to repurchase approximately $356.8 million in aggregate principal amount of our 2025 Notes in separate and privately negotiated transactions entered into concurrently with the pricing of the offering with certain holders of the 2025 Notes effected through one of the initial purchasers of the 2029 Notes or its affiliate, acting as our agent, (2) approximately $47.9 million of the net proceeds to pay the cost of the 2029 Capped Calls and (3) approximately $50 million of the net proceeds to purchase Class A common stock from institutional investors through one of the initial purchasers of the 2029 Notes or its affiliate, acting as Lyft's agent, at a price per share equal to the last reported sale price of the Class A common stock on the Nasdaq Global Select Market on the date of the pricing of the 2029 Notes. Refer to Note 11 "Debt" and Note 12 "Common Stock" to the condensed consolidated financial statements for information regarding these transactions.
In September 2025, we completed an offering of $500 million aggregate principal amount of the 2030 Notes in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. We used (1) approximately $42.0 million of the net proceeds to pay the cost of the 2030 Capped Calls and (2) approximately $95.7 million of the net proceeds to purchase Class A common stock from institutional investors through one of the initial purchasers of the 2030 Notes or its affiliate, acting as Lyft's agent, at a price per share equal to the last reported sale price of the Class A common stock on the Nasdaq Global Select Market on the date of the pricing of the 2030 Notes. Refer to Note 11 "Debt" and Note 12 "Common Stock" to the condensed consolidated financial statements for information regarding these transactions.
We collect the fare and related charges from riders on behalf of drivers at the time the ride is delivered using the rider's authorized payment method, and we retain any fees owed to us before making the remaining disbursement to drivers. Accordingly, we maintain no accounts receivable from drivers. Our contracts with insurance providers require reinsurance premiums to be deposited into trust accounts with a third-party financial institution from which the insurance providers are
reimbursed for claims payments. Our restricted reinsurance trust assets as of September 30, 2025 and December 31, 2024 were $1.8 billion and $1.5 billion, respectively.
We have $2.0 billion in unrestricted cash and cash equivalents and short-term investments as of September 30, 2025. We also have the ability to borrow an aggregate principal amount of up to $420.0 million under the Revolving Credit Facility, none of which has been drawn as of September 30, 2025. Our available credit under the Revolving Credit Facility is reduced by $61.3 million in letters of credit issued under the Revolving Credit Facility as of September 30, 2025. We believe that this provides sufficient liquidity to meet our working capital needs, inclusive of short-term commitments such as capital expenditure needs for at least the next 12 months. On October 14, 2025, we completed the acquisition of TBR Global Chauffeuring, a global luxury chauffeuring company. Upon the close of the transaction, we paid approximately £83.0 million in cash.
In February 2025, we announced that our board of directors had authorized a program for the repurchase of up to $500.0 million of our Class A common stock. In May 2025, our board of directors authorized an increase to the share repurchase program of an additional $250.0 million of our Class A common stock, for a total overall authorization of up to $750.0 million, and we announced our intent to utilize $500.0 million of this authorization before the end of the second quarter of 2026. During the nine months ended September 30, 2025, we repurchased an aggregate amount of $400.0 million of our Class A common stock under the program, excluding broker commissions and fees, and inclusive of the repurchase of Class A common stock in connection with the issuance of the 2030 Notes. As of September 30, 2025, $350.0 million remained available under the repurchase authorization. We have entered into, and from time to time expect to enter into, Rule 10b5-1 trading plans to facilitate the repurchase of shares under the authorization. Repurchases may be made from time to time through open market purchases or through privately negotiated transactions subject to market conditions, applicable legal requirements and other relevant factors. Refer to Note 12 "Common Stock" to the condensed consolidated financial statements for information regarding this program.
We plan to continue to focus on and actively manage our cash balances and liquidity, capital expenditures, working capital and operating expenses. In particular, we continue to actively monitor the impact of the uncertain macroeconomic environment, including credit markets, inflation and interest rates, and have made adjustments to our expenses and cash flow which include headcount reductions in recent years. Our future capital requirements will depend on many factors, including, but not limited to our growth, the effectiveness of our efforts to align our expenses with our current operating needs and short-term commitments, our ability to attract and retain drivers and riders on our platform, the continuing market acceptance of our offerings, the timing and extent of spending to support our efforts to develop our platform, actual insurance payments for which we have made reserves, and the expansion of sales and marketing activities, as well as satisfaction of our obligations with respect to indebtedness. Further, in the future, we may enter into arrangements to acquire or invest in businesses, products, services and technologies. From time to time, we have raised and we may in the future seek, additional equity or debt financing to fund capital expenditures, strategic initiatives or investments and our ongoing operations, or to refinance our existing or future indebtedness. In the event that we decide, or are required, to seek additional financing from outside sources, we may not be able to raise it on terms acceptable to us or at all. The terms of any additional financings or refinancings may place limits on our financial and operating flexibility. If we raise additional funds through further issuances of equity or equity-linked securities, our existing stockholders could suffer dilution in their percentage ownership of us, and any new securities we issue could have rights, preferences and privileges senior to those of holders of our common stock. If we are unable to raise additional capital when desired, our business, financial condition and results of operations could be adversely affected.
Contractual Obligations and Commitments
As of September 30, 2025, there have been no material changes from the contractual obligations and commitments previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Critical Accounting Estimates
Our condensed consolidated financial statements and the related notes thereto are prepared in accordance with GAAP. The preparation of condensed consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from our estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.
There have been no material changes to our critical accounting estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2024.
Recent Accounting Pronouncements
See Note 2 to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for recently issued accounting pronouncements not yet adopted as of the date of this report.
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