Everyone needs an editor. Lyft just learned it the hard way

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It is a truth universally acknowledged, that anyone who makes their living in media or publishing must be in want of an editor.

That goes for MBAs as much as MFAs, and it’s a lesson Lyft executives learned the hard way on Tuesday, when an errant zero sent its stock (briefly) to the stratosphere.

The Lyft typo came in an earnings report that stated, incorrectly, that the company’s estimated gross margin would expand by 500 basis points, which would amount to a stunning five-percentage-point bump. The stock shot up more than 60% before Lyft’s CFO corrected the error on a call with analysts, bringing the stock back to Earth.

Typos are natural, and they are not a moral failing (a gentle reminder to readers who aren’t shy about calling me out on my own blunders). Usually, they cause no harm apart from some mild embarassment embarrassment.

But in a few notable cases, tiny slip-ups have had multimillion-dollar consequences.

History’s pricey oopsies

The award for one of the most expensive, cringe-worthy clerical errors goes to Citibank, which in 2020 fat-fingered $900 million to a group of lenders who should have received just a few million each. That oversight — a result of three different employees’ failure to check two boxes that were part of a workaround within Citi’s janky software — led to more than two years of litigation between the bank and the lenders. Citi ultimately clawed back most, but not all, of the misfired funds.

Second place goes to Mizuho Securities, which in 2005 placed an order to sell 610,000 shares, for one yen apiece, in a company it was helping take public. It meant to sell one share for 610,000 yen. Whoops!

The error tanked shares of the company, a job recruitment firm called J-Com Co. Mizuho’s president at the time said it expected to lose as much as $250 million from the mishap.

‘The most expensive hyphen in history’

In 1962, a typo caused NASA’s Mariner 1 craft to veer disastrously off course. Rather than exploring Venus, the vehicle was ordered to self-destruct shortly after liftoff. Officially, investigators traced the problem back to a missing “R-bar” — a hyphen-like symbol over the letter R, for radius — in an equation loaded into the guidance system.

Technically, it was not a hyphen, NASA says on its website. But conflicting reports about the cause allowed the hyphen theory to flourish. Five days after the $18.5 million craft went up in smoke, a front-page New York Times headline read “For Want of Hyphen, Venus Rocket is Lost.” The sci-fi writer Arthur C. Clarke dubbed the snafu “the most expensive hyphen in history.”

Misspellings can be costly as well. In 2016, hackers got away with an $80 million heist of Bangladesh Bank. But they might have made off with as much as $1 billion if not for a spelling mistake (among other flaws in their plan). The thieves misspelled “foundation” as “fundation,” in an online bank transfer note, which tipped off banking authorities, according to Reuters.

A fun one for all the fastidious grammarians out there: In 2018, a group of dairy delivery drivers in Maine won a $5 million settlement, thanks in part to the lack of an Oxford comma in a state labor law.

The power of ‘not’

Sometimes, the most innocent omission of a word can change everything.

In 2016, a now-defunct firm called Galena Biopharma said in a regulatory filing that it was the target of a federal investigation. Except, it was not the target of the investigation. That’s what it meant to convey, but instead it wrote: “We are a target or subject of that investigation” in its SEC filing. Its stock briefly dipped on the discovery but rebounded after Galena set the record straight.

A missing “not” also spawned the 1631 sensation known as the Wicked Bible, or the Sinner’s Bible, which dropped a critical part of the seventh commandment and thereby encouraged readers: “Thou shalt commit adultery.” (It was probably an honest mistake, or a very bold grift by a polyamorous typesetter.)

We regret the error

The good news for Lyft is that it’s easier than ever to instantly issue a correction and distribute it across the internet. The earnings typo and subsequent stock movement briefly overshadowed the company’s earnings, but the confusion cleared up relatively quickly (faster, one would imagine, than it took to gather up and burn almost every edition of the Wicked Bible, on the orders of an irate King Charles I).

With the error in the rear view, Lyft shares were up 30% Wednesday, bolstered by stronger-than-expected earnings and a rosy outlook for future cash flows.

“Look, it was a bad error, and that’s on me,” Lyft CEO David Risher told CNBC on Wednesday. He also added that the extra zero got through even though it had “thousands of eyes” on it.

“Thank goodness we caught it pretty fast, and we issued an immediate correction.”

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