The nation’s three largest app-based gig companies extended their losing streaks and shedded a combined $9.12 billion in market capitalization Monday after a broad market selloff.
stock closed at an all-time low after sinking 11% to $64.18, its largest percentage decrease since March 14, when it fell 12.54%. It was also the worst three-day stretch for the shares since the three days ending March 7, when they fell 22.93%. The company lost $2.76 billion in market cap Monday.
Shares of ride-hailing giants Uber Technologies Inc.
and Lyft Inc.
both closed at lows they haven’t seen since their worst showing at the beginning of the coronavirus pandemic two years ago. Uber stock closed at $23.05, down 11.6%, its lowest close since April 3, 2020, when it closed at $22.82. Lyft stock closed 9.3% lower at $18.61, its lowest close since March 18, 2020, when it closed at $16.05. Uber saw its market cap lose $5.7 billion and Lyft’s lost $660 million on Monday.
For Uber, the big decline came on the same day as a news report that Chief Executive Dara Khosrowshahi sent a Sunday-night email to staff announcing cost cuts, treating hiring “as a privilege” and having to “do more with less.” In the email, the CEO cited “a seismic shift” in the market and investor expectations. Because of that, he said the company would make a shift of its own: Instead of measuring progress on profitability using adjusted Ebitda, it will use free cash flow.
Analyst Tom White of D.A. Davidson said Monday he was glad to see Khosrowshahi “moving decisively in response to the change in stock-market backdrop and the issues important to investors.”
On the other hand, Lyft executives told analysts during last week’s earnings call that they intended to spend more on driver incentives and marketing, sending the company’s shares plunging. White attributed the contrast in tactics to Lyft’s “lack of a multi-product platform during the pandemic,” which negatively affected its driver supply. Meanwhile, Uber has said its delivery business allowed it to keep ride-hailing drivers on its platform who might have been sidelined by the pandemic.
Uber, Lyft and DoorDash all reported first-quarter results last week, beating revenue expectations but continuing to post net losses. Uber shares have declined 45% year to date, while so far this year Lyft and DoorDash stock have fallen more than 56% and 57%, respectively.