(Bloomberg) — Lyft Inc. is poised to lose more than a quarter of its market value on Wednesday after the ride-hailing company’s second-quarter outlook disappointed Wall Street, highlighting investors’ willingness to dump growth stocks at the first hint of trouble.
The San Francisco-based company’s shares were down 27% to $22.60 in premarket trading. If the decline continues into the regular session, it would represent the stock’s steepest ever drop in a single session, and put it down 71% from the record-high of $78.29 touched in March 2019.
“There’s no room for error in this environment, but still, this selloff seems overdone,” Piper Sandler analyst Alexander Potter wrote in a note.
The gloom from Lyft’s results also spread to its larger and more diversified peer, Uber Technologies Inc., which fell 5.1% premarket.
In a statement released Tuesday evening, Uber said it rescheduled the release of its first-quarter financial results and its quarterly conference to Wednesday morning from the afternoon in order to provide a “more timely update” to its performance and guidance.
Lyft said it expects revenue of as much as $1 billion in the second quarter, and sees earnings before interest, tax, depreciation and amortization of $10 million to $20 million in the period. Both were lower than analysts expected.
Both Lyft and Uber were hard hit during the pandemic as shutdowns slammed the brakes on demand. But now, even with riders returning, the stocks are getting punished as investors grow increasingly wary of expensive and riskier growth assets amid concerns about inflation and a possible economic slowdown.
(Updates to add that Uber rescheduled its quarterly earnings release in the fifth paragraph.)
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