Aug 8 Reuters Lyft signaled on Tuesday it would double down on competitive pricing to catch up with larger rival Uber, taking the shine off its strong earnings forecast and sending the company39;s shares down nearly 7 in extended trading.

Under new CEO David Risher, Lyft has lowered ride fares and embarked on an aggressive costcutting drive to reduce Uber39;s growing lead in the North American rideshare market.

But that strategy dragged down Lyft39;s revenue per active user by 5 to 47.51 in the second quarter. The figure also missed estimates of 48.38, according to Visible Alpha.

We really want to price competitively, Risher said in an interview, days after rising fears of a price war slammed Uber shares and overshadowed the company39;s positive results.

He added that rides receiving primetime charge, or surge pricing, fell 35 sequentially in the second quarter, while the average permile fare was 10 lower from a year ago.

That lower pricing, however, helped spur an 8.2 jump in the number of active riders on the platform to the highest in nearly three years, as Lyft also benefited from a travel rebound and more office commutes.

Third Bridge analyst Nicholas Cauley, however, said the company39;s efforts to offer more competitive pricing could trigger higher driver incentives, affecting its profit target.

The timeline for profitability could be extended as Lyft39;s management is focused on winning back drivers and riders, Cauley said.

For the third quarter ending…