Lyft CEO Logan Green (C) and President John Zimmer (LEFT C) applaud during the Nasdaq opening bell ceremony celebrating the company’s initial public offering (IPO) on March 29, 2019 in Los Angeles, California.

Mario Tama | Getty Images News | Getty Images

Lyft is set to sell its self-driving car unit to Woven Planet, a subsidiary of Toyota, for $550 million in cash, the companies announced Monday.

Shares of Lyft rose about 2% after hours.

As part of the deal, Lyft and Woven Planet will work together on enhancing automated driving technology safety, according to a release.

“Not only will this transaction allow Lyft to focus on advancing our leading Autonomous platform and transportation network, this partnership will help pull in our profitability timeline,” Lyft Co-Founder and President John Zimmer said in a statement.

The company expects the deal will remove $100 million of annualized non-GAAP operating expenses on a net basis, according to the release. Because of that, Zimmer added that if the deal closes when expected in the third quarter and recovery from the pandemic continues, Lyft expects to become profitable on an adjusted EBITDA basis in Q3.

This story is developing.

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