Sign Reading We Deliver Using Doordash with reference to Doordash Grocery Delivery, San Ramon, California September 12, 2020.
Smith Collection / Gado | Stock photos | Getty Images
DoorDash reported a higher than expected quarterly loss on Thursday, attributable to a short-term lack of delivery drivers as consumer demand surpassed its forecast.
But the company raised its forecast and encouraged investors. The stock rose more than 7% in extended trading.
The company reported, relative to Wall Street expectations based on an analyst survey by Refinitiv:
- Loss per share: 34 cents compared to 26 cents expected
- Revenue: $ 1.08 billion versus $ 993.3 million expected
The delivery company reported a net loss of $ 110 million, or 34 cents per share, for the first quarter, which was less than its loss of $ 129 million, or $ 2.92 per share, a year earlier. Analysts surveyed by Refinitiv expected a loss per share of just 26 cents.
The delivery drivers were in short supply, pushing margins further down, but the issue was resolved by the end of the quarter, the company said.
“Stronger than expected consumer demand combined with extreme weather events and the effects of stimulus checks in the latter part of the first quarter resulted in a significant shortage of dashers,” the company executives wrote in a letter to investors.
“Stimulus checks have been particularly challenging because we believe they have increased consumer demand in the short term while reducing dasher hours,” they added.
Net sales rose 198% to $ 1.08 billion, beating expectations of $ 993.3 million. Total orders reached 329 million in the quarter. Price controls imposed by various municipalities on the commission fees that DoorDash Restaurants may charge have generated potential revenue of $ 31 million.
The company also expanded beyond restaurants, supplying flowers, pet supplies, convenience store products, and groceries. Orders in these new categories were up 40% quarter over quarter, despite less than a tenth of active users buying from them in the first quarter. Customers who order from the new categories return to DoorDash more often over a period of three months than customers who only place restaurant orders.
As states reopen and consumers re-dine, DoorDash has a negative impact on new customer growth, order rates, and average order value. But its more loyal customers, like those who subscribe to the DashPass program, have changed their behavior less than newer or infrequent users. The reopening of economies coincides with the warmer weather, which usually results in fewer DoorDash orders.
“Nevertheless, we are encouraged by the consumer behavior observed so far and more optimistic about our outlook for the full year than at the beginning of the year,” wrote the executives.
The company increased its 2021 forecast for gross order value from $ 35 billion to $ 33 billion to $ 35 billion to $ 38 billion. DoorDash also expanded its adjusted earnings before interest, tax, depreciation and amortization forecast range to $ 0-300 million. The previous range was between $ 0 million and $ 200 million.
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