DoorDash – On the rise

With the publication of the second-ever earnings report of America’s largest food delivery service by market share, DoorDash shares surged to a high of 24.2% as against the last trading prices. The company exceeded the estimates by amassing a whopping $1.08 billion compared to $993 million that was forecasted for it. A major contributor to the same can be said to be the unexpected rise in the number of orders placed on the platform which stood at 329 million recording an increase of 219%.

What worked?

With the restaurants returning back to their in-house service, DoorDash maintains a strong rate of same-store delivery upon its platform. The first quarter of the year saw, the company report a 170% increase in the same-store delivery for its partners enrolled on the platform in the state of California. With the performance staying strong and the company maintaining a positive outlook towards the delivery market space, the company expects to turn in $35 - $38 billion in total order value on the platform. This estimate again beats its previous estimates that were forecasted to be in the range of $30-$33 billion.

An emerging market segment for the door-step delivery company happens to be non-food and non-restaurant delivery which takes up 7% of the total business and giving it a strong push. Investors trust in the company is retained even after amassing a net loss of nearly $110 million in the first quarter. A contributing factor has been that the company has been able to achieve wonders in terms of minimizing its losses. Quantifying the same would look like narrowing the loss per share for its stakeholders from $2.92 to a meagre 34 cents.

The road ahead

With the impact of stimulus payments subsiding, DoorDash looks optimistically towards a positive summer market. Aiming to add more delivery partners and drivers onto its platform and adding more restaurants to its network; DoorDash looks to subdue the impact of returning back to the pre-covid times with mass vaccination and a constant rise in the meals eaten within an establishment. The company is exploring ways such as a reduced charges for restaurant partners. Additionally, its measures to help minimize the losses made by restaurants by capping the commissions is also set to expire soon which set back the company to a tune of $31 million in revenues in the first quarter alone. The future looks positive for DoorDash despite its competitors making strides in increasing their own performance.