Lyft's Storm-Impacted Quarter Casts Doubt on $1 Billion Buyback; Shares Fall

• Q1 forecast disappointed with expected adjusted core profit of $120-140 million versus estimates of $139.4 million, impacted by Winter Storm Fern
• The $1 billion buyback represents roughly 15% of Lyft's market cap and follows a previous $750 million repurchase program, reflecting confidence in long-term growth
• Q4 results showed strong performance with 19% bookings growth to $5.07 billion and $1.12 billion in free cash flow for 2025, exceeding estimates of $993.4 million

Summary: Lyft's Storm-Impacted Quarter Casts Doubt on $1 Billion Buyback

Lyft announced a $1 billion share buyback program on February 10, representing approximately 15% of its current market capitalization, adding to an earlier $750 million repurchase plan. However, investor sentiment was dampened by weak Q1 guidance attributed to severe winter weather.

Key Financial Figures:

• Q4 adjusted core earnings: $154.1 million (up 37%, beating expectations of $147.1 million)
• Q4 gross bookings: $5.07 billion (up 19%, meeting estimates)
• Q4 revenue: $1.59 billion (below $1.76 billion estimate due to $168 million in legal/regulatory reserve impacts)
• 2025 free cash flow: $1.12 billion (exceeding estimates of $993.4 million)

Q1 2026 Outlook:

• Gross bookings forecast: $4.86-$5 billion (midpoint roughly in line with $4.95 billion estimate)
• Adjusted core profit forecast: $120-$140 million (below $139.4 million estimate)

Market Impact:

Winter Storm Fern significantly disrupted ride demand, particularly on the East Coast, weighing on Q1 projections and overshadowing an otherwise strong Q4 performance—Lyft's most profitable quarter on record.

Business Highlights:

The company demonstrated strong fundamentals in 2025 with improving margins, European expansion, and premium service growth. Partnerships drove approximately 25% of Q4 rides, with notable momentum from the DoorDash collaboration. Despite weather-related headwinds, Lyft's buyback signals confidence in long-term growth prospects.

Shares fell following the announcement as investors weighed near-term weather disruptions against the company's capital return program and record profitability.