(Bloomberg) -- Lyft Inc. shares rose after the company tapped David Risher to be its new chief executive officer, replacing co-founder Logan Green and setting the stage for a potential sale as the ride-hailing company struggles to compete with bigger rival Uber Technologies Inc.

Green, and co-founder and current President John Zimmer will step back from daily operations after more than a decade with the company but remain on the board, Lyft said in a statement on Monday. Risher, 57, who has been a Lyft board member since 2021, has held previous roles as head of product at Amazon.com Inc. and as a general manager at Microsoft Corp. before launching his own startup called Worldreader. He will take over on April 17.

“The decision suggests that Lyft is in a tough competitive position, given operational challenges vs. larger rival Uber,” wrote Bloomberg Intelligence analyst Mandeep Singh. “Amid a risk of cash burn and market-share loss, we think Lyft may explore strategic options, including a sale.”

Lyft’s shares jumped about 5% in premarket trading before exchanges opened in New York on Tuesday. They are down about 13% so far this year after plunging 74% in 2022.

Read More: Lyft Rises on Appointing CEO, Reaffirming Forecast: Street Wrap

Founded in 2012, three years after its hometown rival, San Francisco-based Lyft has increasingly been marginalized by Uber, which accounted for 74% of the US consumer ride-share sales at the end of December, while Lyft had 26%, according to Bloomberg Second Measure. Uber has benefited from expanding into food and beverage delivery, which helped it thrive during the pandemic when demand for shared rides plummeted.

It also lured drivers with incentives and bonuses during a severe shortage of workers as the economy reopened in 2021. Lyft, meanwhile, has been slow to recover from the pandemic, and the driver shortage caused high prices and long wait times for customers. On a per-mile basis, Lyft fares are 31% higher compared to 2019 while Uber’s are 20% higher, according to YipitData.

In an interview Monday, Risher suggested Lyft isn’t becoming a food-delivery company any time soon and has “big conviction” in the core ride-hailing business model. “We’re going to focus super hard on customers,” Risher said in an interview. “When you open the app, we’re not losing on price. We’re going to make sure that our service levels go high. We’re going to just really focus on the basics in the short term.”

In January Lyft reduced base ride prices to keep up with a similar move by Uber, a move that analysts fear will erode any chance for profits. Last year, the company increased the service fee riders pay directly to cover higher insurance costs. Those expenses are expected to continue to rise. Rather than have riders bear the burden, Lyft has been willing to take the hit to profits instead, Zimmer said in February.

Read more about Lyft’s nice-guy approach and how its cautious strategy may have hurt it in the long run.

Lyft has made an effort to cut costs, shedding more than 700 employees last year. Last month, the company forecast dramatically lower profits in the current quarter, sending its shares plunging. Lyft’s earnings stood in stark contrast to rival Uber, which saw ride bookings soar by 31% in the fourth quarter surpassing its delivery bookings for the first time since the pandemic. 

To increase customer retention, the company has worked to expand its subscription product, Lyft Pink, and has partnered with Grubhub to offer members a complimentary subscription to the food-delivery platform. Lyft also launched an advertising unit last year to tap higher-margin revenue, a strategy other on-demand platforms including Uber, Instacart Inc. and DoorDash Inc. have implemented.

“All founders eventually find the right moment to step back and the right leaders to take their company forward,” Green said in the statement. “David has the right energy, ambition, and experience to lead Lyft into the future.” In a blog post, Green said he will spend more time with his family and explore new ways to help protect the planet.

Analysts and investors welcomed the management shakeup as an opening for Lyft to explore opportunities it has eschewed in the past, such as international expansion and food delivery. But CFRA Research analyst Angelo Zino said he doubts Lyft’s share loss in the US will reverse “anytime soon.”

“This was the right strategic move that should have happened last year,” analysts at Wedbush Securities wrote. With the change, “all options are now on the table for Lyft including a potential sale with a new CEO in the seat.”

 In a corporate filing, Lyft said it would pay Risher an annual salary of $725,000 and a signing bonus of $3.25 million.

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