DoorDash sees record orders in Q2 as it combines with Wolt
DoorDash on Thursday said it received a record number of customer orders in the second quarter, boosted by resilient demand and its acquisition of Finnish delivery service Wolt Enterprises.
DoorDash said orders grew 23% to 426 million in the April-June period, surpassing Wall Street’s expectations. Analysts polled by FactSet forecast total orders of 419 million. The delivery company’s gross order volume jumped 25% to $13 billion, also beating expectations.
Based on the strong results, San Francisco-based DoorDash raised its full-year order forecast. The company now expects gross order volumes between $51 billion and $53 billion, up from the $49 billion to $51 billion range it forecast earlier this year.
DoorDash shares jumped 13.5% in after-hours trading.
DoorDash said its net loss for the quarter more than doubled to $263 million as it closed the $8.1 billion acquisition of Wolt. The company said stock-based compensation costs and increased headcounts hurt profits. Wolt has around 6,000 employees.
The company lost 72 cents per share in the April-June period, compared to a 30-cent per share loss in the same period a year ago. That was far larger than the 21-cent per share loss Wall Street expected.
DoorDash said it hasn’t seen much negative impact from inflation. Consumers added slightly fewer items per order in response to higher prices at restaurants and other retailers. But the company also gained customers during the quarter.
DoorDash CEO Tony Xu said DoorDash’s growth __ it has added 80,000 stores to its platform over the last year __ is one reason sales continue to grow even as consumers pull back on some spending. Xu said history also shows that food spending rarely declines due to economic conditions.
“It is less of a discretionary spend relative to other categories of spend,” Xu said Thursday during a conference call with investors.
The company also hit an all-time high for DashPass members, indicating users are seeking more affordable options. DashPass members get free delivery on most orders; the membership costs $59 in the first year and $96 annually after that.
DoorDash didn’t provide an update Thursday on the number of DashPass members it has. But it has previously said that the number tops 10 million.
DoorDash also said it also gained drivers during the quarter and was able to retain them with benefits like gas-cost relief and mileage-based bonuses. DoorDash said it spent $40 million on those benefits during the quarter.
DoorDash said high inflation is likely causing more people to consider gig work for extra cash. The typical DoorDash driver makes deliveries for just four hours per week; 90% work under 10 hours per week.
The company said its full-year outlook anticipates softer consumer spending in the second half of this year. DoorDash could also potentially lose customers to rival Grubhub, which recently combined with Amazon to offer free delivery for a year.
DoorDash announced in November its plan to buy Wolt, which operates in 22 countries where DoorDash has no presence, including Germany, Sweden, Hungary and Israel.