DoorDash’s second quarter orders hit record high but revenue gains slow
ASSOCIATED PRESS / 2020
The DoorDash app is shown on a smartphone in New York. DoorDash Inc. reports quarterly financial results after the market close.
DoorDash booked a record number of orders in the second quarter even as its revenue growth slowed from pandemic-induced highs.
The San Francisco-based delivery company said its total orders rose 69% to 345 million in the April-June period from the same span in 2020. Non-restaurant orders —— from new partners like 7-Eleven, PetSmart and the grocery chain Albertsons —— grew faster than restaurant orders, DoorDash said.
DoorDash’s revenue was up 83% to $1.24 billion, surpassing Wall Street’s expectations. Analysts polled by FactSet had forecast revenue of $1.1 billion for the quarter.
But the growth was lower than the double- and even triple-digit percentage revenue gains DoorDash saw over the prior four quarters as the pandemic juiced demand for delivery.
One issue: Many cities have temporarily capped the fees DoorDash can charge to merchants in an effort to help small businesses during the pandemic. DoorDash said those price caps cost the company $26 million in the second quarter.
Last month, DoorDash sued the city of San Francisco over its 15% fee cap per order, which was made permanent in June.
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DoorDash reported a net loss of $102 million for the quarter as it continued to invest heavily to grow in new markets like Japan. The loss, amounting to 30 cents per share, was far wider than Wall Street’s expectation of a 6 cent per share loss.
DoorDash shares dropped 4% to $181.08 in after-market trading.
