The TTC is en route to a budget shortfall of an estimated $30 million, which a staff report pinned on lower-than-anticipated ridership in the beginning of 2016.
There were 83.9 million rides in January and February of this year — a drop of 1.4 million compared to this period last year, according to a TTC staff report. That represents four million rides below the TTC's projected target.
If the trend continues at that rate for the remainder of the year, the transit agency could see the number of rides fall to between 530 and 535 million, according to the report.
"Clearly, ridership is not where we want it to be," TTC spokesperson Brad Ross said of the "worrisome" trend.
"This is really early," he said. "We'll see what March holds in terms of ridership."
Currently, the TTC projects a year-end total of 540 million rides, which is a minor increase to last year's 538 million rides.
Alongside dwindling ridership, the report pinpointed slowing employment growth, declining adult Metropass sales and riders yet to "become fully acquainted" with service increases as possible reasons for the lower numbers.
The report added that the impact of lower gasoline prices, as well as ride-hailing services like Uber, is "difficult to quantify" but GTA transit agencies believe both contribute to declining ridership.
Bill Worrell, who is part of a TTC riders' group, said he is not surprised by the decline in ridership.
"I think that this most recent fare hike has been a deal breaker for some folks," he said.
"Given the fares and the services — service breakdowns, delays, things like that — people are starting to look for other options."
The most recent city operating budget included a cash fare increase of 25 cents, as well as a 10-cent hike for tokens.
The TTC may need to scale back increased service on some routes to prevent a substantial deficit.
"There could be some cost savings to be had there. So peeling back some of that might be something we have to do," Ross said. Though he declined to specify which routes could be affected.
There is also $15 million in a TTC stabilization reserve, he said.
The report will be presented next Wednesday at a TTC board meeting.