In an impressive turn of events, Lyft's shares experienced a significant boost in after-hours trading following the company's release of better-than-expected earnings and optimistic guidance. The ride-hailing giant revealed that it anticipates generating positive free cash flow for the full year for the first time.

According to LSEG (formerly Refinitiv), Lyft reported adjusted earnings of 18 cents per share, surpassing analysts' estimated 8 cents. The company's revenue for the quarter reached $1.22 billion, meeting the expectations set by analysts.

Compared to the previous year's figures, Lyft's revenue showcased a 4% increase from $1.175 billion. Additionally, Lyft's first-quarter bookings are projected to range between $3.5 billion and $3.6 billion, outperforming StreetAccount estimates of $3.46 billion.

Lyft's CEO, David Risher, who assumed the position in March last year, expressed his satisfaction with the results. Risher highlighted that the company achieved a record number of annual riders, with rides surging 26% from the previous year to 191 million in the fourth quarter. Furthermore, active riders rose by 10% to reach 22.4 million.

Gross bookings for the entire year also saw an impressive 14% climb, reaching $13.8 billion, while bookings for the quarter rose by 17% to $3.7 billion. These figures reflect the company's resilience in a competitive market, where it continues to invest heavily to compensate drivers and contend with its larger rival, Uber.

The news of Lyft's positive earnings came as welcome relief for investors, as the company went public in 2019 and has since struggled, grappling with substantial cash outflows. Despite the recent surge in after-hours trading, Lyft's stock remains over 70% below its debut price.

Looking ahead, Lyft is optimistic about its financial prospects, fueled by its performance and strategic initiatives. The company affirmed that it plans to reduce capital expenditures for 2024 compared to the previous year, enabling it to generate positive free cash flow for the full year, a significant milestone.

As Lyft aims to navigate its path to profitability and regain market confidence, analysts and investors will keep a close eye on the company's ability to sustain its growth and address its ongoing challenges.