Urban mobility company Lime said on Thursday it had turned its first quarterly profit, as it launched a new e-scooter model amid signs that the market for socially distanced short-range travel is hotting up.
The U.S. startup raised $170 million at a reduced valuation in May that brought on board Uber as an investor. It took over the ride-hailing company’s Jump e-bikes as part of the deal and promoted Wayne Ting to CEO.
Ting said that Lime generated positive free cash flow in the third quarter, having exited some markets where it was losing money, optimized the operation of its two-wheelers and cut head office costs.
“With these improvements I believe we’re on track to be fully profitable in the full year 2021,” he told Reuters in an interview.
Lime is rolling out its Gen4 e-scooter in Paris, featuring a swappable battery, while Ting teased the launch of a mystery “third mode” of transport in the New Year that will add a new option for city trips of up to 5 miles (8 km).
In Europe, Lime faces competition from Berlin-based Tier Mobility, which has just raised $250 million from investors led by Softbank Group Corp’s Vision Fund 2 at a reported valuation of just below $1 billion.
That is higher than the post-money valuation of $540 million for Lime’s last funding round, even though the American company’s presence in 30 countries and more than 100 cities around the world is larger.
“It’s been a tough year for the world – we’re not the only company that had to go through a down round,” said Ting, adding that Lime’s round was done at a time of great uncertainty in the early stages of the coronavirus pandemic.
“A lot has changed since then – including that revenue has come back and people have learned about how the virus spreads – human to human, indoors. And we have a product that’s the best transportation mode amid a COVID crisis.”
(Reporting by Douglas Busvine; Editing by Kirsten Donovan)