DoorDash experiences a surge in orders and revenue in Q2 despite a decrease in US restaurant traffic

DoorDash announced on Thursday that it achieved record numbers in orders and revenue during the second quarter, despite a slowdown in U.S. restaurant visits. The company, headquartered in San Francisco, saw a 19% increase in total orders, reaching 635 million in the April-June period, surpassing Wall Street’s expectation of 625 million. Revenue also climbed by 23% to $2.6 billion, beating analysts’ forecast of $2.5 billion. Following this news, DoorDash shares surged by nearly 14% in after-hours trading.

While U.S. restaurant demand has declined due to inflation concerns prompting more people to cook at home, DoorDash has diversified its services beyond food delivery, collaborating with a broader range of stores. In the second quarter, it partnered with Ulta Beauty, Lowe’s, Vallarta Supermarkets, and other West Coast grocers. Additionally, the company delivered hundreds of thousands of flower bouquets for Mother’s Day.

Despite these achievements, DoorDash reported a narrowed net loss of $158 million, equivalent to 38 cents per share, exceeding analysts’ projection of a per-share loss of 9 cents. This higher-than-expected loss may unsettle investors, who have expressed worries about the company’s rising expenses. DoorDash attributed the increased costs to higher marketing and development expenses, as well as charges for office lease impairments and litigation reserves.