DoorDash’s stock took a significant hit late Wednesday, dropping as much as 19%, following the company’s third-quarter earnings report, which revealed profits that fell short of analyst predictions. Adjusted earnings per share for the quarter came in at $0.55, notably below the expected $0.68, according to data from Bloomberg. However, the company did report revenue of $3.45 billion, surpassing forecasts that anticipated $3.36 billion.
In addition to the disappointing earnings, DoorDash provided a somber outlook for the fourth quarter, projecting profits that are likely to underperform the expectations set by Wall Street analysts. Despite the challenges in profitability, the company did manage to report higher total orders and marketplace gross order value (GOV). Total order volumes reached 776 million, exceeding analysts’ expectations by 5 million. Marketplace GOV also surpassed estimates, registering at $25.02 billion compared to the projected $24.58 billion. This figure also exceeded DoorDash’s own quarterly forecast of $24.2 billion to $24.7 billion.
Looking ahead to the fourth quarter, DoorDash anticipates adjusted EBITDA in the range of $710 million to $810 million, which is roughly in line with the $754 million reported in the previous quarter. The company forecasts marketplace GOV to be between $28.9 billion and $29.5 billion.
In its earnings release, DoorDash highlighted notable achievements in the third quarter, including a doubling of the monthly active users gained during the first nine months of the year compared to 2024. The U.S. restaurant category experienced year-over-year growth in marketplace GOV, while the company expanded partnerships in various sectors such as grocery, retail, alcohol, floral, pet supplies, gifting, and convenience, leading to increased user engagement.
The decline in DoorDash’s stock aligns with a broader trend of weakness observed in restaurant stocks this year. Economic pressures have led consumers to become more selective in their spending, seeking value as they navigate tighter household budgets. Prior to the report, DoorDash’s stock had seen a considerable rise of about 40% throughout the year, making the recent downturn even more pronounced.
