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DoorDash recorded a loss per share of $1.65, which is higher than the earlier prediction of 68 cents
Online food ordering company DoorDash (NYSE: DASH) popped in after-hours trading after the company squashed expectations in sales during Q4 2022. Following the better-than-expected results that triggered a 6% jump in the company’s shares, DoorDash is building on its Q4 2022 performance to give optimistic guidance for the current three-month period.
According to the Q4 2022 financial results by DoorDash, revenue surpassed analysts’ expectations of $1.77 billion at $1.82 billion. In addition to rising above forecast, the quarterly revenue also did better than the $1.3 billion recorded during the same period of the previous year. The report also revealed that DoorDash delivered more orders in 2022 Q4. The total number of orders surged 27% to 467 million. Meanwhile, analysts projected the total orders to be around 458 million.
What Brought Losses to DoorDash in Q4 2022
However, the company recorded a loss per share of $1.65, which is higher than the earlier prediction of 68 cents. DoorDash attributed the Q4 2022 loss to changes in its purchase of Wolt, a Finnish food delivery company. Also, the November layoff cost the company some money, contributing to the loss. The American online food ordering company dismissed 1,250 corporate workers in November 2022 as part of its effort to cut costs. DoorDash hired more people during the pandemic to meet up with growth and increased demand. However, CEO Tony Xu said the staff cut was necessary to address the growing operating expenses.
To support impacted staff, DoorDash promised severance packages that resulted in losses in Q4 2022. While announcing the job cut, the CEO said affected workers would receive compensation for 17 weeks in addition to their February 2023 stock vest. He also spoke about healthcare benefits till 31st March to support the employees. Eventually, DoorDash recorded losses related to the stock-based compensation expenses.
For the current quarter, DoorDash is calling for its marketplace gross order volume to reach between $15.1 billion and $ 15.5 billion. On the other hand, analysts’ prediction was $15 billion in marketplace gross order volume. DoorDash is also making changes to its leadership team, naming Prabir Adarkar as President and Chief Operating Officer. At the same time, Ravi Inukonda will become the company’s Chief Financial Officer beginning on 1st March 2023.
At premarket trading, DoorDash stock is up 6.14% to $71. After losing over 36% over the past year, the company has been rebounding and gathering significant gains. DASH has grown more than 37% since January and has improved by almost 14% in the last three months. Also, the company has popped 22.40% over the past month and 8.15% in the last five days.