Last-mile delivery company DoorDash saw its stock value rally by double-digits on Thursday in after-hours trading upon the release of its Q2 earnings report that revealed the company set a new quarterly record for total orders.
Total orders were up 19% year over year to 635 million, and marketplace GOV, or the total dollar value of orders completed on DoorDash’s marketplace, jumped 20% year over year for the quarter to $19.7 billion.
Revenue was up 23% to $2.6 billion for the quarter compared to the same period in 2023, and the company’s net revenue margin reached 13.3%, up from 13% a year ago.
“Over the last year, we have added important new merchants to our U.S. marketplace in the grocery, beauty, home improvement, alcohol, and sporting goods categories. Our goal across all of these categories is to provide our merchant partners with world-class logistics, demand generation, digital ordering, and consumer service capabilities,” DoorDash reported.
DoorDash CEO Tony Xu said grocery and convenience sales have been a big focus for the company, according to a transcript of the earnings call published by Seeking Alpha.
“That’s been a big focus for us for years, and we’re excited,” Xu said. “Just this morning, we announced an update to our partnership with Chase, which now makes us Chase’s exclusive partner in both restaurant delivery and grocery delivery for all of their cardholders.”
Xu noted that the growth of its grocery, alcohol, and other vertical businesses is driving rapid growth in the company’s CPG ad business.
“Every CPG is a customer and the question is like, how fast do we get into that spend?” Xu said. “The way I think about this is, there’s no rush to doing it. And you can actually make a pretty big mistake if you get into it too quickly. I mean, as long as we have the biggest audience with the greatest level of activity in terms of frequency engagement, retention, and frequency, we’re always going to be available to the CPG advertiser.
“And I think they’re always going to be interested, and they’re always looking for the best returns, and I think it tends to come from the marketplaces that aren’t the biggest — just the biggest, but also the ones with the highest activity and the highest growth rates.”
Xu added that “the health of the marketplace should always come before the monetization of the marketplace.”
He said the company has taken a conservative position on ad placement to “protect the consumer experience.”
“Again, we’re super proud of, I think, our ad business. I think the size of the business would be impressive as a standalone company. But at the same time, we have to make sure the sequencing is right, where we are always making sure that we have the most engaged, the largest audience when it comes to local commerce. That will make it easy for everything else from an ad perspective,” he said.
