Lyft’s losses incurred by the Argo shutdown only account for about a third of the company’s total losses for the quarter. In Q2, Lyft lost $422.2 million, which is a larger cost than the $99.7 million in the same period of 2021 and a net loss of $377.2 million in the second quarter of this year.

A bigger portion of Lyft’s losses are attributable to $224.1 million in stock-based compensation and related payroll expenses, an increase from $179.1 million in the second quarter. The uptick is related to the top-up that Lyft issued to employees when its stock price declined earlier in the year, according to a Lyft spokesperson.

In regards to that reduction in workforce, Lyft expects to “incur a charge of between $27 million and $32 million” in Q4, as well as “a stock-based compensation charge and corresponding payroll tax expense related to affected team members, as well as restructuring charges related to a decision to exit and sublease, or cease use, of certain facilities,” said Elaine Paul, Lyft’s chief financial officer, during Monday’s earnings call. “However, we aren’t able to estimate these charges at this time because they depend in part on our future stock price.”

Paul also said Lyft has been working to reduce stock-based compensation next quarter by ceasing new hires in the U.S. and shifting the nexus of hiring away from the U.S. and toward international markets like Canada and Eastern Europe where “there’s a different compensation model with low or no equity.”

Lyft’s stock, which had started to climb after Uber reported strong earnings last week, fell 14.36% Monday in after-hours trading. The company’s shares have slid 69.29% since the start of the year.

Lyft closed the quarter with $143.7 million in cash.

John Zimmer, Lyft’s president, said he was confident that Lyft would be able to achieve its Q4 goals regardless of the macro environment.

“We’ve been using internally two main cases. One is the growth case, which assumes market bookings grow in the low to mid 20% year over year, and that the labor market stays as tight as it currently is,” said Zimmer during the Q3 earnings call.And then, internally what we call a recession case where the market growth slows and we see operating leverage through lower driver engagement and acquisition costs if unemployment rises. So in both cases, we have a very confident path to the billion dollars, and in both cases, we’ll continue to focus our R&D spend on marketplace innovation that helps improve the cost basis of the business.”

Lyft takes $135.7 million hit on Argo AI shutdown by Rebecca Bellan originally published on TechCrunch

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