The Report also added a zero to its annual earnings causing an uproar. The correct net profit after tax was zero but wrongly presented as zero zero.
Said a visibly embarrassed Spritzler, I don't understand your animus, I never proofread anything in the Report. Are you surprised?
Lyft accidentally put an extra zero in its earnings report. Now shareholders are suing
One too many zeros prompted Lyft’s shares to swell over 60%. Shareholders are feeling burned
By Francisco Velasquez, Quartz Media
March 7, 2024
Less than a month after Lyft posted its fourth-quarter earnings and complete 2023 financial results on Feb 13., shareholders are still feeling burned. Now they’re suing.
In a civil class action suit, plaintiff and shareholder Yuan Chen alleges that he purchased 20,000 shares of Lyft’s common stock and suffered damages as a result of misleading statements made by the San Francisco, California-based company.
The lawsuit was filed in the U.S. District Court in the Northern District of California.
Chen’s counsel says that the defendants, including Lyft’s chief executive officer David Risher and chief financial officer Erin Brewer, had been provided the copies of the company’s report before they were publicly released and “had the ability and opportunity to prevent their issuance or cause them to be corrected.”
The information that has since been adjusted initially detailed that Lyft’s adjusted EBITDA margin expansion – which considers the total sum of ride transactions – would grow by 500 basis points, about 5%, throughout 2024.
One too many zeros prompted Lyft’s shares to swell over 60% after the bell. During the company’s earnings call, Lyft’s Brewer said that in her prepared remarks, she had referenced 50 basis points of margin expansion, or 0.5%.
Brewer’s statement, however, had an immediate impact on the market, the lawsuit said.
“Lyft common shares were reversing and trading at $12.92 a share between 4:50 and 4:51 p.m,” the lawsuit said. “Between 4:05 p.m. and 4:51 p.m., however, millions of Lyft shares traded at inflated prices.”
Plaintiff Chen is seeking demand for relief and a trial by jury.
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