Tony Xu, co-founder and CEO of DoorDash Inc., smiles during the Wall Street Journal Tech Live conference in Laguna Beach, California, USA, on Tuesday, October 22, 2019.
Martina Albertazzi | Bloomberg | Getty Images
DoorDash released its fourth quarter 2020 earnings after the bell on Thursday that exceeded analysts’ revenue estimates, but included a large net loss in its first launch as a public company.
After the report, shares fell more than 12% after the exchange closed.
Here are the key numbers:
- Recipe: $ 970 million, versus $ 938 million expected, according to a Refinitiv survey by analysts
- Loss per share: $ 2.67, not adjusted
CNBC does not compare reported earnings with analysts’ estimates for a company’s first report after going public because uncertain stock counts can distort expectations.
The company reported a GAAP net loss of $ 312 million, which was mainly due to IPO-related costs and share-based compensation. This is still more than double GAAP net loss in the fourth quarter of 2019, which reached $ 134 million.
Its revenue for the quarter represented 226% growth year on year.
DoorDash’s public debut came as Americans continue to rely heavily on food delivery services, while taking precautions to minimize the spread of Covid-19. DoorDash saw growing demand, with total orders in the fourth quarter growing 233% year on year to 273 million.
But DoorDash told shareholders that it expects some of the favorable winds it has experienced with requests to stay in the U.S. to change once the country has the virus under control.
“We expect markets to start opening up soon. As this happens, we expect declines in consumer engagement and average order values, although the exact quantity is still unclear,” wrote the company. “In any scenario, we will continue to focus on reducing friction in our Marketplace and executing the factors that will lead to long-term adoption by the consumer: selection, experience and value.”
The company warned that the outlook for the year “remains highly uncertain”, but provided some guidance based on the assumption of a “successful implementation of the COVID-19 vaccines”.
The company predicts that first-quarter adjusted EBITDA will fall between $ 0 and $ 45 million and will be in the range of $ 0 to $ 200 million for the entire year 2021. It expects the gross order amount in its market will fall between $ 8.6 billion and $ 9.1 billion in the first quarter and between $ 30 billion and $ 33 billion for the entire year.
DoorDash started trading on the New York Stock Exchange in December, ending its first day of trading with an increase of more than 85%, with a market value of $ 60.2 billion. Since then, stocks have fallen below that valuation, currently around $ 53 billion.
The company revealed $ 149 million in revenue losses of $ 1.9 billion through September 2020 in its IPO prospectus, showing great growth and reduced losses compared to the previous year. In 2019, DoorDash had a net loss of $ 533 million over revenue of $ 587 million during the same nine months.
The pandemic has further illuminated the spotlight of gig workers for apps like DoorDash, Lyft and Uber, which have a workforce of independent contractors. The health crisis renewed progressives’ calls to give show workers the protection of employees, including health benefits and paid sick leave.
But California voters gave concert companies a big victory in November when they voted in favor of their electoral measure, Proposition 22. The measure said that food and ride workers can remain independent, but may be entitled to additional protections, such as guaranteed minimum portable gains and benefits.
DoorDash noted in its earnings release that the next quarter will be the first full quarter operating under Proposal 22 “and ongoing price controls.” The company said this is likely to negatively impact its take rate and adjusted EBITDA.
This story is developing. Check back for updates.
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