DoorDash’s grocery business fuels record growth

Thanks to its grocery business, DoorDash recently reported its “best quarter ever,” with total orders up 25% year-over-year to 532 million. 

According to the company’s recently released second-quarter earnings, the total sales value of orders made on DoorDash marketplaces was up 26% year-over-year to $16.5 billion, and revenue was up 33% year-over-year to $2.1 billion.

DoorDash said it attributes its record-setting growth to a focus on “steadily improving the quality of experience we offer to consumers, merchants, and Dashers.” 

The company also reported stable growth in its U.S. restaurant marketplace and accelerated growth in our U.S. non-restaurant categories and international markets, especially grocery.

“Over the last two and a half years, we’ve built a multibillion-dollar grocery business from scratch, and it was really ready for primetime exposure,” DoorDash CEO Tony Xu told analysts on a call. “… We now have more non-restaurant stores on the platform in North America [than] any other platform. We’re growing faster than every other platform and gaining share dramatically in virtually all categories, and very specifically also in grocery.”

The company said that the cumulative impact of these improvements, along with effective execution and durable end markets, were also factors driving strong growth and improved efficiency in the second quarter.

Related:DoorDash is testing out AI chatbot technology

Order frequency was also at a new all-time high, DoorDash said, and based on third-party data, “We believe we gained share in the U.S. restaurant, U.S. convenience, and U.S. grocery categories, as well as in many of our international markets during the quarter.”

Improvements to logistics quality and efficiency and a growing contribution from advertising helped drive revenue up 33%. DoorDash also mentioned steady product improvements that have made “dashing attractive to millions of people and helped generate leverage in our sales and marketing expenses in recent years.” 

One recent pivot for the delivery company is the new option for drivers to toggle between being paid an hourly minimum wage or the choice to earn money for each delivery.