By Granth Vanaik
(Reuters) -DoorDash on Wednesday forecast fourth-quarter core profit above estimates after topping revenue expectations, boosted by an uptick in delivery orders for food, convenience items and groceries, sending its shares up 7.3% after the bell.
The upbeat results have been aided by the company's investments to improve its services as well as partnerships with brands such as Sephora and ALDI, helping it grow faster and increase its market share in the U.S.
"We are on track to generate over $1 billion in adjusted EBITDA and more than 2 billion orders this year," CFO Ravi Inukonda told Reuters
DoorDash (NASDAQ:DASH) had in August projected adjusted EBITDA of between $750 million and $1.05 billion.
The company expects fourth-quarter adjusted EBITDA, a key measure of profitability, of between $320 million and $380 million, compared with analysts' estimates of $253.3 million.
"More number of users are ordering from both restaurants as well as new verticals," Inukonda said on a post-earnings call.
In the third quarter, total orders rose 24% to 543 million from a year earlier.
"The significant growth in orders... demonstrates clearly that consumers remain willing and able to pay extra for convenience," said Insider Intelligence analyst Rachel Wolff.
After a surge in demand during the pandemic, delivery firms are now looking to stabilize their profits.
The company expects gross order value - the total value of all app orders and subscription fees - to be between $17 billion and $17.4 billion for the fourth quarter, compared with $14.4 billion a year earlier.
Revenue rose 27% to $2.16 billion, compared with analysts' expectations of $2.09 billion, according to LSEG data.
Net loss narrowed to $73 million, or 19 cents per share, in the third quarter, compared with $295 million, or 77 cents per share, a year earlier.
Rivals Uber (NYSE:UBER) and Instacart (NASDAQ:CART) are set to report third-quarter results next week.