Lyft’s Co-Founder and CEO, Logan Green, announced on Monday that he would be stepping down from his position. The ride-hailing company has been struggling to stay afloat for some time now, and with Green’s departure, many are speculating that a sale may be in its future.
Green will be replaced by David Risher, a former Amazon executive who has served as a director on Lyft’s board for the past two years. However, Risher has not operated a for-profit business for several years, leading many to believe that his appointment is a sign that Lyft is open to selling itself.
Self-driving taxi developers appear to be the most likely acquirers of Lyft, but even they have struggled with reducing their cash burn. Lyft’s stock has plummeted over 85% since its initial public offering in 2019, a result of a combination of factors, including the pandemic and competition from larger rival Uber. As a result, Lyft’s market capitalization has fallen below $4 billion.
Lyft has yet to turn a profit or generate cash from operations, and things seem to be getting worse. In February, the company reported that its operating loss had more than doubled to $596 million, while cash burn had increased. Furthermore, Lyft expects revenue to increase by only 11% in the current quarter, compared to 21% in the fourth quarter of last year, a slowdown that has spooked investors.
Lyft missed a critical opportunity to catch up to or overtake Uber in 2017 when a series of scandals befell the ride-hailing pioneer. Now, with Green stepping down and the company struggling, it remains to be seen whether Lyft can regain its footing or if it will be acquired by another company. Only time will tell what the future holds for Lyft and its investors.