DoorDash raises core growth target after revenue tops estimates

Reuters DoorDash Inc raised its fullyear forecast for a key industry metric on Thursday, indicating it has largely skirted labor woes that have plagued most sectors to ensure seamless delivery of food and groceries.

Shares of the company surged 8 in extended trading after DoorDash also reported a betterthanexpected 35 rise in revenue for the first quarter, while allaying concerns that an easing pandemic would prompt people to eat out more and order in less.

The company‘s image as an enabler of gigeconomy has helped attract a steady stream of delivery agents, unlike restaurant chains such as Domino’s Pizza and Pizza Hut that have struggled to maintain their fleet of riders in a tough labor market.

“There hasnt been a fiscal stimulus since the first half of last year. And some of that might be playing a part into the attractiveness of being a Dasher,” DoorDash Chief Financial Officer Prabir Adarkar told Reuters.

The company also said its new incentive to offer 10 cash back on gas also helped retain delivery agents.

DoorDash now estimates gross order value, the total value of all app orders and subscription fees, of between 49 billion and 51 billion for 2022, compared with its prior range of 48 billion to 50 billion.

For the first quarter, the company posted a wider loss on higher costs, as it invested heavily in building out its delivery network for groceries, liquor and pet foods as well as its international business.

Net loss was 167 million, or 48 cents per share, compared with 110 million, or 34 cents per share, a year earlier.

Overall revenue was 1.46 billion. Analysts on average were expecting a loss of 41 cents per share and revenue of 1.38 billion, according to Refinitiv IBES data.