Lyft Inc. narrowly beat analysts’ predictions in its second quarter even as the company’s revenue was hammered by the ongoing COVID-19 pandemic.

For the quarter ended June 30, Lyft reported revenue of $339.3 million, down 61% from the second quarter of 2019. Analysts had been predicting $336.8 million.

Net loss in the quarter came in at $437.1 million, surprisingly down from $644.2 million a year ago, while the loss adjusted loss for items such as stock compensation was 265.8 million, or 86 cents per share. Analysts had been predicting an adjusted loss of 99 cents per share.

COVID-19 dominated the figures, with ridership in the quarter slumping 60% from 21.8 million riders in the second quarter of 2019 to 8.7 million. Revenue per active rider was down 2% year-over-year, to $39.06.

Despite difficult trading conditions, Lyft credited its lower-than-expected loss to cost-cutting measures such as its decision to lay off 17% of its employees in April. The adjusted net loss figure was still significantly higher than the $97.4 million loss Lyft reported in the first quarter.

Lyft did not provide estimates for the third quarter but did note that rider numbers were increasing. “While rideshare rides in the quarter were down significantly year-over-year, we are encouraged by the recovery trends we are beginning to see, with monthly rideshare rides in July up 78% compared to April,” Lyft Chief Executive Officer Logan Green said in a statement.

Shares in Lyft were up as much as 6% after the earnings report was released but crashed back down again following the earnings call. On the call, co-founder and President John Zimmer warned that the company may need to suspend its services in California starting Aug. 21 if an appeal to overturn a court ruling ordering it to treat its drivers as employees is not successful.

The ruling Aug. 10 came following legal action by California Attorney General Xavier Becerra and a number of cities in relation to California Assembly Bill 5, a law that went into effect in January. It forces companies to classify gig-economy and freelance contractors as employees if they work more than a certain number of hours.

Lyft is not alone in saying that it will be forced to suspend services in the state. Uber Technologies Inc. also said today that it will also suspend services if the ruling is not overturned. Although details are not yet available, Lyft is expected to team with Uber and PostMates Inc. to appeal the ruling.

Shares in Lyft took a roller-coaster ride in after-hours trading, going as high as $31.93 before dropping as low as $30.04, settling to a decline of less than 1%.

Photo: Lyft