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BenzingaEditorial

The Food Delivery Business Won The Pandemic But Uncertainty Lies Ahead

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Food delivery was a rare place of major activity in a year shaped by the global pandemic, with stay-in-place orders helping fuel demand for at-home dining. Consolidation has been a major trend among these companies in an effort to capture additional market share and serve more geographies. With their latest earnings reports, Uber Technologies Inc (NYSE: UBER) and GrubHub Inc (NYSE: GRUB) showed that food deliveries are still going strong despite eased restrictions. This week, DoorDash Inc (NYSE: DASH) is expected to also provide reassurance that this positive trend will last once customers are no longer homebound and restaurants have reopened.

Uber’s Q1 results showed food delivery’s strength

The hunger for its thriving food delivery business during the lockdowns actually helped Uber reduce its losses. This segment once again helped ease the blow from a slow quarter for ride-hailing bookings, enabling the giant to report better-than-expected earnings in its first quarter of 2021, despite reporting its ride bookings were flat from the previous quarter and had decreased YoY.

Uber’s delivery segment, which includes its Uber Eats restaurant delivery business, saw its revenue more than triple from last year and grow 28% from last quarter as it brought $1.7 billion to the table. In an investor presentation last Wednesday, Uber showed delivery booking in Sydney and New York increased as those cities were reopening, confirming the loyalty of its customers.

To position itself for continued growth in a post-pandemic world, the company intertwined its ride-hailing app with its delivery business. In a nutshell, it introduced a feature that enables passengers to book and pick up meals while reaching their destination in an Uber. As passengers go back to requesting trips from airports, the app also asks them whether they would like food delivered through the Eats app to wherever they are headed.

Even before these last week’s changes, the ride app drove more first-time users to the food app than all of Uber’s paid channels combined. Therefore, Mr. Khosrowshahi is confident that the company will benefit from the complementary nature of two of its large core opportunities even after COVID-19 stops shaping our everyday life.

Despite strong revenue growth, GrubHub reported surprising quarterly loss due to fee caps

Although it brought in more money in the first quarter than in the same period a year ago, the company also lost more money too while bein in the final stages of being digested by JustEat Takeaway.com (OTC: TKAYY). The $7.3 billion merger is expected to be completed in the first half of the year, and it will create the largest food delivery service outside of China.

GrubHub posted 52% revenue growth YoY in Q1 2021 with revenues of $551 million, thanks to all that pandemic-driven demand for delivery. Gross food sales grew 60% YoY to $2.6 billion, up from $1.6 billion in the first quarter of 2020, along with high-single-digit YoY growth in orders. Revenue grew between 41% and 53% in each of GrubHub’s past fourth quarters, marking the best gains for the company since 2018. So-called active diners, or unique GrubHub user accounts, jumped 38% to 33 million in the quarter, exceeding the expectation of 31 million.

But restaurant fee caps hit company hard. GrubHub reported a net loss of $75.5 million, or 81 cents per diluted share, up from a $33.4 million loss YoY. First-quarter 2021 negative adjusted earnings before interest, taxes, depreciation and amortization was $9.3 million or 14 cents per order compared to $31 million and 52 cents per order in the fourth quarter. Besides the “temporary restaurant fee caps,” which it opposes, the bottom line was also harmed by increased delivery driver costs caused by short-term driver supply imbalances from surging demand, extreme winter weather in several locations and to some extent, the issuance of stimulus payments that led some drivers to temporarily reduce their hours in March.

Bloomberg consensus estimates show Wall Street expects Q2 revenue to slow down to 16% YoY increase, the slowest rate in more than a year, but GrubHub has downplayed these concerns.

According to Matt Maloney, GrubHub founder and CEO, first quarter results showed strong execution, easily hitting records for all its key business metrics.

A crowded space

GrubHub’s competitors have captured a greater share of the lucrative U.S. market. Data from Second Measure showed orders from the online and mobile food ordering and delivery marketplace and its subsidiaries, Seamless and Eat24, comprised 17% of U.S. meal delivery sales this March, which is below UberEats’ 22% and DoorDash’s 55%.

Outlook

These companies are proud of their role in helping restaurants grow their businesses and supporting them during a global pandemic that put the whole world on pause and companies across the globe out of business. But the balance of the business will inevitably change as people come out of the pandemic and Wall Street was already bracing for a slowdown in sales with vaccinated individuals eager to return to in-person dining.

As a vaccinated public begins traveling and going to restaurants again, these companies limited visibility into how their delivery business would fare in the coming months. Year-over-year comparisons have become tougher and food delivery services are now dealing with great uncertainty in predicting post-reopening consumer behavior.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

BenzingaEditorial

This Week’s Recap

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The market and the economy continue to open, which is probably a result of bottled-up demand for many products and services affected by the pandemic. Maybe the inflation or rising bond yields will trigger the selloff on the market at some moment, but the current Fed’s transitory inflation message has been accepted by many investors. Also, the best way to deal with inflation is to stay with your investments and keep your faith in the market. So, despite the jump of May’s consumer-price index, that did not affect the investors who adopted a different mindset, so all three major averages finished in a positive zone.

The Dow Jones Industrial Average managed to recover from one of the steeper declines, thanks to gains from companies like IBM (NYSE: IBM), Microsoft (NASDAQ: MSFT), and Salesforce (NYSE: CRM). The Nasdaq Composite Index has also risen 49.09 points to 14,069.42. The tech-heavy index continued with the positive run, led by DocuSign (NASDAQ: DOCU), Zoom Video (NASDAQ: ZM), and CrowdStrike (NASDAQ: CRWD).

Tuesday brought us an earnings report from Oracle

Although it was a slim week for the earnings reports, Oracle (NYSE: ORCL) announced its last quarter results, as well as plans and guidance. The results are better than expected, as the achieved revenues were $11.23 billion (compared to the expected $11.04 billion) and the achieved adjusted earnings of $1.54 per share (compared to the expected $1.31). On the other hand, the company revealed its quarterly revenue guidance, which is lower than expected due to the plans to increase investments to support its cloud strategy and keep migrating existing on-premises customers to the cloud. This all led to a share fall of 5%, as many investors are skeptical if Oracle can successfully compete with major “cloud” players like Amazon (NASDAQ: AMZN), Salesforce, or Workday (NASDAQ: WDAY).

Adobe reported impressive results on Thursday

The Wall Street analysts recognized the work-from-home trend and this second digitization era as the main reasons for Adobe’s (NASDAQ: ADBE) sustained growth and therefore a monster quarter. And they were right. The company reported revenues of $3.84 billion, which is an increase of 23% compared year to year. That is also above the Wall Street estimate of $3.73 billion. The digital media business revenues, consisting of Creative Cloud and Document Cloud, grew by 25% compared to the previous year. The adjusted earnings per share were $3.03, which is higher than the estimated $2.81. For the following quarter, the company expects revenues of $3.88 billion and adjusted earnings per share of $3.00.

Conclusion

All these factors taken together, proven by positive index movements and earnings results better than anticipated, support the fact that the economic recovery is firmly underway, and those are very encouraging news.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

Several new earnings reports and more management presentations this week

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We might be witnessing the lower volume of quarterly earnings reports this week, but that only means we passed last quarter’s report peak and we are getting ready for the June-quarter earnings season, which will hit us not long after the 4th of July. However, we do not lack many management presentations, which are typical after announcing earnings reports. This week brings us news for future result expectations from more than 30 companies, so let’s try and not miss any important clues. Besides earnings reports, this week is bringing us a total of 9 new IPOs like Marqeta, Inc. (NASDAQ: MQ), TaskUs, Inc. (NASDAQ: TASK), LifeStance Health Group, Inc. (NASDAQ: LFST), monday.com Ltd. (NASDAQ: MNDY), Zeta Global Holdings Corp.(NYSE: ZETA) and Jaws Hurricane Acquisition Corp (NASDAQ: HCNEU).

Monday

Yesterday we saw the first quarter report of fiscal 2022 for Marvell Technology (NASDAQ: MRVL), a Delaware-based company that develops and produces semiconductors and related technology. Marvel Technologies reported new revenues of $832 million, which is an increase of 20% year-to-year. GAAP gross profit margin was 50.2% and non-GAAP gross margin was 64.3%, while GAAP diluted loss per share was $0.13 and non-GAAP diluted income per share was $0.29.

Also, Vail Resorts, Inc. (NYSE: MTN) which owns and operates several premier mountain resorts in Colorado and California, reported fiscal 2021 third-quarter results yesterday. The report showed a net income of $274.6 million which is an increase of 80% compared to the third fiscal quarter of 2020. The reported EBITDA was $462.2 million, which is a significant increase from last year same quarter’s $304.4 million.

Tuesday

Besides earnings reports from Navistar International (NYSE: NAV) and Calavo Growers (NASDAQ: CVGW) on Tuesday, we are also expecting reports from Thor Industries (NYSE: THO), Casey’s General Stores (NASDAQ: CASY), and ABM Industries (NYSE: ABM).

Wednesday

Wednesday is reserved for earnings reports from Brown Forman (NYSE: BF-B), United Natural Foods (NYSE: UNFI), and Restoration Hardware (NYSE: RH). RH, the California-based furnishing company is expected to report earnings of $3.99 per share, which is growth of over 214% compared to the same period last year. Also, GameStop Corp (NYSE: GME), one of the world’s largest video game retailer’s earnings report is expected on Wednesday. The expected loss for the first quarter is $0.68 per share, which is an improvement from the same period last year (-%1.61 per share). In order to accelerate its transformation, the company decided to restructure its board, so it can keep up with industry growth and company expansion in the digital arena.

Thursday

On Thursday, we expect to see reports from National Beverage (NASDAQ: FIZZ), Chewy (NYSE: CHWY), and Dave & Buster’s (NASDAQ: PLAY). Chewy, the Florida-based pet store retailer, is expected to report a quarterly revenue growth of over 125%, compared year over year.

Friday

We are not expecting any major earnings reports on Friday.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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BenzingaEditorial

The week may be starting slowly but do not let that mislead you

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The celebration of Memorial Day in the U.S. caused the slower start, but the rest of the week will bring us plenty of news, updates, and earnings reports from companies like Zoom Video Communications (NASDAQ: ZM), Hewlett-Packard Enterprise (NYSE: HPE), Advanced Auto Parts (NYSE: AAP) and Slack Technologies, Inc. (NYSE: WORK). This week will also bring us news from the EV and the IPO worlds, as well as the 2021 Bitcoin conference, one of the biggest cryptocurrency events this year. Before we move to the day-to-day highlights, if you are a small business owner, do not miss today’s deadline to apply for the latest round of the Paycheck Protection Program funding.

Tuesday

This week’s earnings reports will be led by Kirkland’s Inc (NASDAQ: KIRK), and that is due before the market opens. It will be followed by HP’s and Zoom’s earnings reports, after the bell. SoFi Technologies (NYSE: SOFI) is a fintech startup IPO joining the trading world after its SPAC merger on Friday.

 

Wednesday

Before the market opens on Wednesday, we are expecting the earnings reports from Advance Auto Parts and Lands’ End Inc (NASDAQ: LE). The reports will keep coming after the bell as well, so we are keen to see how NetApp Inc (NASDAQ: NTAP), Endeavor Group Holdings (NYSE: EDR), Splunk Inc (NASDAQ: SPLK), and PVH Corp (NYSE: PVH) did in the previous period. Wednesday is also the day when we are expecting the Beige Book, which will give us the latest analysis of the economic conditions in the U.S. as the COVID-19 restrictions reduce.

Thursday

Thursday is expected to be the busiest of the week, when we expect earnings reports from Express Inc (NYSE: EXPR), Asana Inc (NYSE: ASAN), Duluth Holdings Inc (NASDAQ: DLTH), Broadcom Inc (NASDAQ: AVGO), The Toro Company (NYSE: TTC), The Cooper Companies (NYSE: COO), Science Applications International Corporation (NYSE: SAIC), Lululemon Athletica (NASDAQ: LULU), as well as Slack Technologies.

Thursday is a big day for NVIDIA Corporation (NASDAQ: NVDA) also. After reporting the record profits and earnings, highly affected by the company’s revenues from graphic cards for crypto mining, the shareholders will vote on a 4-for-1 stock split. That will increase the number of authorized shares of common stock, and if approved, each shareholder will receive an additional dividend of three additional shares.

Thursday will be also interesting in the automotive world. Kia will start taking reservations for its new EV6 crossover, while Nio Inc (NYSE: NIO), the Chinese automaker, will hold a general meeting so it can increase the diversity of its board.

This day will also be dominated by cryptocurrencies, as the 2021 Bitcoin conference, taking place in Miami, will kick-off.

Friday

The week’s end is reserved for the earnings report from Hooker Furniture Corporation (NASDAQ: HOFT), and that is expected before the opening bell. During the rest of Friday, we will focus on the latest unemployment rates and data.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure. IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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