Lyft’s 2024 Success Driven by Customer Focus, Price Lock Service

One of the key factors behind Lyft’s success in 2024 was its focus on enhancing driver satisfaction and improving service reliability.

According to CEO David Risher, the company’s “customer obsession” drove this profitable growth. During the company’s fourth-quarter earnings call Tuesday (Feb. 11), Risher noted drivers collectively earned $9 billion in 2024, the highest in the company’s history, and saw its largest-ever number of driver hours in Q4. This focus on driver incentives has paid off, he added.

“We are executing spectacularly and customer obsession has driven profitable growth,” Risher said. “We had a record number of active riders and our average ETAs are the fastest in the industry.

“But we’ve got more to do. Our biggest competition is inertia. 2025 will be the year we show millions of riders and drivers: You’ve now got a better rideshare choice.”

One of the notable innovations for Lyft, Risher said, is its Price Lock service, which guarantees riders consistent pricing during their trips. Priced at under $5, Price Lock aims to enhance the rider experience by reducing the impact of fluctuating ride prices. Since its launch, 70% of Price Lock purchases have been made in 2024, and Risher believes this initiative is already paying dividends.

“For riders, we want them to expect more from every journey,” he said. The company has also rolled out new features for both drivers and passengers, with more updates expected in 2025.

“Customers like Price Lock,” Risher added. “We’ve had 1.6 million Price Lock rides so far and we think they’re largely incremental.”

Finished 2024 on High Note

Lyft finished the year on a positive note, reporting a 15% year-over-year increase in fourth-quarter bookings, bringing in $4.3 billion. This increase was powered by a 15% increase in rides, totaling 218.5 million, and a 10% rise in active riders, reaching 24.7 million, the highest levels in company history. Lyft’s full-year revenue rose 31%, to $5.8 billion.

Despite the positive fourth-quarter and full-year results, Lyft’s performance is tempered by the challenges ahead. The company is facing headwinds as it works to maintain this growth momentum. Although Lyft’s fourth-quarter bookings and rides were record-setting, its outlook for the first quarter of 2025 appears more cautious. The company has projected Q1 bookings in the range of $4.05 billion to $4.20 billion, marking a more modest year-over-year growth rate of 10-14%.

“The reality is when prices go up, ride go down and vice versa,” Risher said. “Quarter by quarter, that’s going to happen. We’re seeing great demand. We’re super excited about what lies ahead.”

AVs in Not-Too-Distant Future

One thing that lies ahead is the company’s plans to launch autonomous robotaxis in Dallas next year, with additional markets to follow. The vehicles will be owned and financed by Marubeni, a Japanese fleet management company, and equipped with Mobileye’s self-driving technology. Lyft aims to scale the service to thousands of vehicles across multiple cities. The move comes as Lyft seeks to capitalize on the growing autonomous vehicle market, amid competition from Uber and Tesla, both of which are working on similar initiatives.

“AVs [autonomous vehicles] will be a transformational addition to the marketplace,” Risher said. “We’ll start in Dallas and we do expect to move into other markets.”

Despite the strong performance in 2024, Lyft remains focused on overcoming what Risher sees as the biggest hurdle: inertia.

“Our biggest competition is inertia,” he explained. “2025 will be the year we show millions of riders and drivers: You’ve now got a better rideshare choice. At the beginning, there was a fair amount of getting the basics right. Then we moved into innovating on the platform. The next thing is we’ll be a little more vocal about it and show it off in new ways.”