DoorDash's stock rose by more than 16% Thursday following the company's better-than-anticipated Q3 results, which were announced the day before. A whopping 104 million food orders were received over the course of the year, jumping from 439 million to 543 million. Analysts praised the report for indicating strong future growth prospects.
Shares in DoorDash surged 16% on Thursday, following the release of results for the company which exceeded both Wall Street's top and bottom-line estimates. According to London Stock Exchange Group (formerly Refinitiv), revenue for the period came in at $2.2 billion, surpassing the anticipated $2.1 billion. Meanwhile, the loss per share at 19 cents per share was better than the analysts' consensus of 40 cents per share.
Compared to the year-earlier period, DoorDash posted a net loss of $73 million, a marked improvement from the $295 million net loss (or 77 cents per share). Total orders stood at 543 million, a 24% year-over-year increase from 439 million. However, this was less than the 27% increase recorded in the year-ago quarter.
On a call with analysts, CEO Tony Xu emphasized how essential food spending is to everyone saying: “You don’t have to spend on delivery but macro trends show that convenience is becoming increasingly important.”
Commenting on the rising popularity of weight-loss drugs such as Wegovy, Xu remarked that there had not been any obvious impacts. JPMorgan analysts noted in a research note to clients that the business was showing greater efficiencies, particularly in the United States restaurant sector. They also noted that DoorDash's fourth-quarter Marketplace GOV outlook - forecast at between $17 billion and $17.4 billion - indicated an 18% to 20% year-on-year growth, and exceeded expectations by roughly 3%.
Moreover, the JPM analysts added that cohort behavior remained positive among both new and existing users. Although they maintained a neutral outlook on the stock, they were more positive about the company's ability to accelerate its business and increase margins.
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