(Reuters) -DoorDash raised its annual core profit forecast for a second time and beat quarterly revenue expectations on Wednesday as orders for groceries and food surged despite higher prices, sending its shares up nearly 6% in extended trading.
The delivery firm posted its highest revenue since its IPO in Dec. 2020 as people stick to the pandemic trend of buying from their homes, thanks to promotions, deals and free deliveries with subscription passes by DoorDash and its rivals.
DoorDash expects a key measure of profitability, adjusted EBITDA, between $750 million and $1.05 billion, compared to the prior outlook of $600 million to $900 million.
“In Q2, we continued to see strong consumer demand, thanks to our continued focus on selection and affordability,” finance chief Ravi Inukonda said.
Total orders rose 25% to 532 million from a year earlier.
In contrast, growth in the delivery business for rival Uber Technologies slowed to nearly 14% in the second quarter from 37% a year ago, indicating weakness in consumer spending.
DoorDash said it expects gross order value – total value of all app orders and subscription fees – to be between $64.2 billion and $65.2 billion for 2023, compared with the prior forecast of $63 billion-$64.5 billion.
Higher promotions, however, led to a 12% rise in its sales and marketing expenses at a time when it has been trying to keep a tight lid on costs after announcing job cuts last year.
DoorDash’s revenue rose 33% to $2.13 billion, beating expectations of $2.06 billion, according to Refinitiv data.
Net loss narrowed to $170 million, or 44 cents per share, in the quarter, compared to $263 million, or 72 cents, a year ago.
(Reporting by Granth Vanaik in Bengaluru; Editing by Arun Koyyur)
