DoorDash Surges To 42M Monthly Users As Grocery And Retail Sales Soar Amid Record Order Frequency

As DoorDash Inc.‘s DASH user base exploded to 42 million monthly active users with order frequency at an all-time high, its grocery and retail vertical saw stellar growth along with the aforementioned metrics in the fourth quarter.

What Happened: DoorDash’s customers were ordering from all categories, explained the company CFO Ravi Inukonda during its earnings call. “We are the fastest growing in the U.S., we’ve gained share in new verticals through the year,” he said.

Emphasizing the grocery segment penetration Inukonda added “There are several countries where new verticals and grocery penetration in the international portfolio is actually higher than what we’re seeing in the U.S.”

DoorDash highlighted its current 42 million monthly active users are growing in double-digits and the record order frequency at an “all-time high” indicates strong user engagement and platform stickiness.

Furthermore, talking about DashPass subscriptions co-founder and CEO, Tony Xu said that they have over 100 million customers, who order with the brand annually and its DashPass and Wolt+ subscribers were only in “the tens of millions.”

“So we have a large fraction of our customer base within our own ecosystem that are not subscribers. So that’s the first thing we have to go and solve,” added Xu.

Why It Matters: DoorDash’s fourth-quarter earnings per share met expectations at $0.33, while revenue beat estimates at $2.87 billion. Total orders rose to 685 million, up 19% year-over-year. Marketplace GOV, which stands total dollar value of orders completed in the company’s marketplaces, increased by 21% to $21.3 billion.

The company anticipates its adjusted EBITDA, as a percentage of Marketplace GOV, will grow sequentially throughout the year, increasing from the first quarter to the second quarter, and again from the second quarter to the third quarter. CFO added that DoorDash was “very confident with the outlook for the full-year.”

Price Action: The shares rose by 0.24% to $193.09 apiece on Tuesday and advanced by 5.71% in after-hours, whereas the exchange-traded fun tracking Nasdaq 100 index, Invesco QQQ Trust, Series 1 QQQ fell 0.24%.

DASH shares have gained 13.15% on a year-to-date basis, whereas it was up by 63.03% over the last year.

The average price target among 33 analysts tracked by Benzinga is $180.94 with a ‘buy' rating. The estimates range from $115 to $225 apiece. Recent ratings from Benchmark, JMP Securities, and UBS suggest a $206.67 target, implying a potential upside of 1.25%.