Tina Bellon

(Reuters) –Uber Technologies Inc beat expectations for operating earnings on Wednesday and predicted a strong second-quarter. It said it did not need additional incentives to increase its driver supply like its smaller competitor Lyft .

After Lyft Inc (NASDAQ) shares dropped 26% Tuesday afternoon, Lyft Inc (NASDAQ) shares fell 26% Wednesday. Lyft Inc (NASDAQ) said that it needs to pay more for drivers. This caused Uber (NYSE) to drop in its wake.

Uber stock shares fell 2.1% pre-market, partially compensating some losses that Lyft had suffered Tuesday afternoon after its earnings announcement.

Uber saw a decrease in monthly active customers in the third quarter of this year compared to the prior quarter. While it is common for industry workers during winter, Uber was determined to stand out from any smaller rivals.

Uber is attracting more drivers than other platforms because of its post-pandemic driver base. We expect this trend not to stop without significant incentive investments,” Dara Khosrowshahi, Uber’s Chief Executive stated in prepared remarks.

Uber’s first quarter adjusted EBITDA (which excludes stock-based compensation) was $168 million. According to IBES data from Refinitiv, this was higher than the $132 million average expectation by analysts.

Uber’s forecasted adjusted EBITDA for second quarter was $240m to $270m, exceeding the median analyst estimate of $237 million.

Total revenue of $6.9B increased 136% to $6.13B, exceeding estimates.

Uber stated that it expects to produce “meaningful positive cash flow” for the entire year. This would be the first achievement of this goal in Uber’s history, dating back 13 years.

Uber’s loss in its first quarter rose to $5.9 billion, from $108 million last year. It was driven by $5.6 billion of drops in value in shares in other poorly performing companies. These include Didi Global Inc., a Chinese ride-hail firm.

Nelson Chai, Uber’s chief financial officer, said in a statement that Uber had enough liquidity to wait for the right time and sit on losses.

Uber appears to be on the right track for its ride-hail service, surpassing pre-pandemic levels during the second quarter. April mobility bookings exceeded 2019 levels in every global market.

Uber Eats customers continued to order food delivery from their restaurants despite the return of Uber riders.

However, the number of monthly active platform users dropped to 115m in March 31, from 118m in the fourth quarter.