Shares of DoorDash (NYSE: DASH) was up 22.65% from 2:16 p.m. EST on Friday after the company reported strong first quarter results that weighed on analysts’ expectations.
The food delivery platform also offered a rosy outlook, allaying fears that demand would decline as the pandemic slowly eases in key markets. DoorDash was a massive beneficiary of the shift in consumer behavior during the crisis when people stopped going to restaurants and ordered more deliveries.
Here’s what influenced DoorDash’s results
First quarter revenue nearly tripled to $ 1.1 billion, slightly beating the consensus estimate of $ 990 million in revenue. This resulted in a net loss per share of $ 0.34, which was worse than the $ 0.14 per share loss that Wall Street analysts modeled. Adjusted EBITDA was $ 43 million, near the upper end of the DoorDash forecast.
Total orders increased 219% to 329 million and the Marketplace GOV (gross order value) increased 222% to $ 9.9 billion. Both key metrics hit new quarterly records and, according to DoorDash, improved customer loyalty helped improve results. In addition, DoorDash has made progress in expanding to non-restaurant categories. The Dashers supply everything from convenience items to groceries and alcohol to pet supplies. Orders outside the restaurant now make up over 7% of all orders.
“As we continue to expand our marketplace beyond restaurants, our goal is to improve the customer experience by working against the same vectors, but in a broader way. Choice across multiple categories, quality and consistency in experience with all partner dealers, and affordability in terms of delivery, collection and use cases at work, ”the company wrote in a letter to shareholders.
Vaccinations in the United States are hopefully reducing COVID-19 cases and deaths, reopening more markets and allowing people to eat more frequently. According to DoorDash, going back to the store has less of an impact on order volume than expected.
DoorDash’s forecasts were also encouraging for investors: Marketplace GOV forecast a range of 9.4 to 9.9 billion US dollars for the second quarter. This should result in an Adjusted EBITDA from breakeven to $ 100 million in the second quarter.
Looking ahead, the company has significantly improved its prospects for Marketplace GOV in 2021. DoorDash now expects Marketplace GOV to be between $ 35 billion and $ 38 billion for the year, compared to its previous forecast of $ 30 billion to $ 33 billion. This should result in an Adjusted EBITDA of breakeven this year to $ 300 million.
The outlook is that the vaccine distribution will continue and store food rates will increase, while DoorDash’s business is also seasonal. The order rates tend to fall in the summer months before rising again in the winter.
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