(Bloomberg) -- The latest rideshare data shows the first sign of softness since April as coronavirus cases continue to grow in states where Lyft Inc. and Uber Technologies Inc. do business.
Weekly average users contracted in the U.S. for the week ended June 21, according to Evercore analyst Benjamin Black, who characterized the early signs of softness as a “clear setback” to recovery hopes. Shares of Lyft and Uber fell about 2% in early trading, while car rental company Avis Budget Group declined 5%.
“Fears of a second wave are clearly weighing on most travel stocks, and rideshare names are not immune,” Black said. “Though officials have so far ruled out a second lockdown, the rising caseload could still slow volume recovery.”
Evercore’s app tracker shows that combined weekly average user data are now down 68% year-over-year, the analyst said, with Uber down 63% and Lyft down 74%. The discrepancy in their respective performance may have to do with exposure to hot-spot states. Arizona, California, Florida and Texas account for roughly 35% of total U.S. gross bookings, with those states making up 15% of Uber’s total rides compared to Lyft’s 45%.
There’s hope yet. App downloads are still ticking up, which are now back to 60% of normalized levels in the U.S., Black said.
Another positive specific to Uber: subscription software. Uber secured a new source of high-margin subscription revenue in a recent partnership with Marin County in the San Francisco Bay area. Uber app users there will see more ride options, including on-demand ride service specific to Marin and receive discounts for Uber rides to local transit hubs.
The two-year, $80,000 contract is modest, Black said. However, if it leads to similar city partnerships, that may be a feather in the cap concerning new revenue streams for the company.
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