DoorDash sees strong quarterly growth in sales and orders but warns of big costs

DoorDash said Wednesday its revenue rose 38% in the fourth quarter as it gained new U.S. customers and added new services like restaurant reservations

DoorDash Results (Copyright 2023 The Associated Press. All rights reserved.)

DoorDash said Wednesday its revenue rose 38% in the fourth quarter as it gained new U.S. customers and added new services like restaurant reservations.

But investors may be more focused on the cost of new projects, including the development of autonomous delivery robots and tests of drone delivery.

DoorDash's stock fell 3% in after-hours trading Wednesday.

The San Francisco-based delivery company reported revenue of $3.96 billion for the October-December period. That was less than the $3.99 billion that analysts polled by FactSet forecast.

Total orders rose 32% to 903 million, beating analysts’ forecast of 884.8 million, according to FactSet. DoorDash said it had more than 56 million active users during the quarter, including 35 million members paying monthly fees to be part of its DashPass, Wolt+ and Deliveroo Plus programs.

But DoorDash also spent heavily during the quarter. Its research and development costs rose 41%, for example, while its sales and marketing costs jumped 31%.

DoorDash CEO and Co-founder Tony Xu said Wednesday that DoorDash is in the midst of building a single tech platform that will bring together its many international businesses. DoorDash bought Wolt, a Finnish delivery service, in 2022, and it acquired Deliveroo, a U.K. rival, last year.

“This is a massive and expensive undertaking and honestly one you shouldn’t do if you thought your best days were behind you,” Xu said in a letter to investors.

DoorDash’s net income rose 51% to $213 million, or 49 cents per share. That was lower than the 59-cent profit Wall Street anticipated.