Investing.com -- DoorDash (NASDAQ:DASH) shares dropped in premarket U.S. trading after the delivery firm unveiled a wider-than-projected fourth-quarter loss due in part to elevated labor costs.
San Francisco-based DoorDash posted a loss of $0.39 per share in the three months ended on Dec. 31, below estimates of a $0.16 loss, according to LSEG data cited by Reuters.
Speaking to analysts following the report, Chief Financial Officer Ravi Inukonda said that the company was hit by a costs related to a new regulations that have led to increased minimum wages for its delivery workers.
Total expenses jumped by 9.3% during the quarter, also reflecting a rise in spending on advertising and a push to expand its core business beyond restaurant deliveries.
However, total order value on the DoorDash app rose 22% to $17.64B, with overall orders swelling 23% to 574M. "U.S. restaurant delivery experienced growth consistent with last year, along with limited variability in growth across quarters," analysts at Jefferies said in a note to clients.
In the current quarter, adjusted earnings were forecast to come in at between $320 million and $380 million. Analysts polled by Capital IQ were projecting $358.9M.
For 2024, the company guided for total app order value of between $74B to $78B and an adjusted profit of $1.5B to $1.9B. Analysts were expecting an adjusted income outlook of $1.63B.