DoorDash Q4 earnings: Customers are ordering more delivery, but company posts wide net loss
DoorDash saw an all-time high of monthly active users, total order numbers, and marketplace gross order value in its fourth quarter of 2022, according to Thursday’s quarterly earnings report, as consumers showed no signs of slowing down spending on takeout and delivery.
But the company widely missed estimates when it came to net loss in the quarter. DoorDash posted a net loss of $642 million dollars in its fourth quarter, compared to the $256 million expected. The company said that much of those expenses are due to one-time scenarios, such as costs associated with November layoffs and stock-based compensation. There was also an accounting charge that DoorDash’s vice president of finance Ravi Inukonda said in an interview didn’t impact free cash flow. (DoorDash said that at the end of 2022, it had $21 million in free cash flow.)
“If you look at Q4, it was our best quarter ever in terms of both GOV, which is our top line, as well as EBITDA, which is our bottom line,” Inukonda said. (EBITDA stands for earnings before interest, taxes, depreciation and amortization.) The company posted an all-time high-adjusted EBITDA of $117 million in the quarter.
Inukonda is himself the subject of some news within the company: He will be stepping into the role of CFO effective March 1. The current CFO, Prabir Adarkar, will in turn become the next COO and president, replacing Christopher Payne, who is retiring from management after holding the post for seven years. Payne will remain with the company as an advisor through the end of May.
Shares jumped more than 5% in after-hours trading.
The delivery platform posted revenue of $1.8 billion, which is up 40% year-over-year and roughly in-line with analyst expectations. Within that same time period, DoorDash said the total number of orders grew to 467 million, which is up 27% year-over-year. Marketplace GOV (or the total value of its app orders and subscription fees) also was up 29% from the same quarter a year prior to $14.4 billion. For the full year of 2022, marketplace GOV was $53.4 billion, just beating the high-end of its full-year guidance.
DoorDash said its monthly active users hit 32 million, which is up from 25 million for the same quarter a year prior. DoorDash also now has more than 15 million subscription members, indicating many of its users have become repeat customers.
The report comes amid an earnings season that investors were widely tuned in to on fears that consumers have cut back on nonessential goods, including rideshare and food delivery.
Still, DoorDash expressed optimism for the current quarter and the full year of 2023. The company anticipates full year 2023 marketplace GOV to come in between $60 billion and $63 billion. It expects first quarter marketplace GOV to range between $15.1 billion and $15.5 billion, which would mark 25% year-over-year growth on the high end. DoorDash also anticipates 2023 adjusted EBITDA to nearly double its 2022 figure, guiding a range of $500 million to $800 million. For the first quarter alone, it’s anticipating a range from $120 million to $170 million.
DoorDash’s board of directors also approved a stock repurchase of up to $750 million of its Class A common stock.
“As we continue to expand and add new categories and improve the quality of the product, we are giving people more reasons to come back and order more, so we’re seeing an increase in order frequency as well,” Inukonda said. “The combination of that plus the growth in our international business . . . is what’s giving us confidence in the outlook of GOV going forward.”
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