DoorDash shares continued their post-earnings rise after the San Francisco-based delivery giant reported its third-quarter financial results, which showed double-digit gains in total orders and revenue, among other things.
DoorDash co-founder and CEO Tony Xu
Its shares rose about 20 percent following the positive news and maintained that rise after DoorDash also reported a significantly narrower overall loss for the quarter. The company said it was its best quarter as a public company in terms of order volume, revenue, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) and net loss.
In the quarter ended September 30, 2023, total DoorDash orders increased 24 percent to 543 million, with gross order value also increasing 24 percent year-over-year to $16.8 billion. Total revenue increased 27 percent year-over-year to $2.2 billion, with net loss narrowing to $75 million, compared to a loss of $296 million in the third quarter of 2022. Adjusted EBITA increased from 87 million US dollars in the same quarter last year to 344 million US dollars.
In a DoorDash shareholder letter explaining the results, co-founder and CEO Tony said the company presents a significant opportunity going forward.
Despite a number of external challenges, including persistent inflation, “strong” competition and changes in regulation, Xu and Inukonda said they were proud of the company’s recent results and believe ongoing investments are boosting its potential and increasing the scale of local trade in the communities it serves.
In an interview with Fast Company, Inukonda emphasized that not only is the total number of users increasing – with plenty of room for late adopters starting to deploy – but existing users are also increasingly using DoorDash.
The company predicted “significant ongoing investments” in both new categories and international markets.
“While we have managed to improve execution and appeal to more consumers, merchants and dashers in recent years, we are still far from where we want to be,” the executives said. “There are still hundreds of millions of consumers who don’t regularly use our service, tens of millions of people who could benefit from Dashing who haven’t tried it yet, and at least hundreds of thousands of merchants who we believe we can help.”
DoorDash does not break out its order volume by product category. In response to a question during the earnings call, Inukonda said the company was “very pleased” with the performance of its grocery business and that its teams are focused on increasing grocery adoption as well as other new verticals that the delivery platform has added.
He added that many of the company’s initial customers are using DoorDash for categories outside of restaurants.
“If you look outside of restaurants and look at the convenience, grocery and alcohol segments, customers who are using e-commerce for the first time in those categories are coming to DoorDash.”
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