10-QPeriod: Q3 FY2021

DoorDash, Inc. Quarterly Report for Q3 Ended Sep 30, 2021

Filed November 10, 2021For Securities:DASH

Summary

DoorDash, Inc. reported strong revenue growth in the third quarter of 2021, with revenue increasing by 45% year-over-year to $1.275 billion. This growth was driven by a 47% increase in Total Orders, reaching 347 million. The company also saw a 44% increase in Marketplace Gross Order Value (GOV) to $10.4 billion. Despite top-line growth, the company's net loss widened to $101 million for the quarter, compared to $43 million in the same period of the prior year. This widening loss was primarily attributed to increased operating expenses, particularly in sales and marketing, research and development, and general and administrative functions, partly due to substantial stock-based compensation expenses related to IPO-related equity awards. The company's cash position remains strong, with $2.9 billion in cash and cash equivalents and $1.3 billion in short-term marketable securities as of September 30, 2021, providing ample liquidity for at least the next 12 months. Key areas of increased spending included sales and marketing (up 54%) driven by increased advertising and brand marketing, and research and development (up 180%) driven by stock-based compensation. While Contribution Profit improved in absolute terms to $281 million, the Contribution Margin decreased to 22% from 24% in the prior year, due to higher first-party product costs and increased Dasher acquisition costs. The company continues to navigate significant legal and regulatory challenges, particularly concerning Dasher classification, which could materially impact its business model and financial results if reclassified as employees. Despite these challenges and continued investment in growth, DoorDash is focused on long-term value creation.

Financial Highlights

46 data points
Beta

Revenue

$1.27B

Net Income

-$101.00M

-7.9% Net Margin

EPS (Diluted)

$-0.30

Total Assets

$6.36B

Cash & Equivalents

$2.86B

Free Cash Flow

$76.00M

Financial Statements
Beta
Revenue$1.27B
R&D Expenses$115.00M
Operating Expenses$1.38B
Operating Income-$100.00M
Interest Expense$0
Net Income-$101.00M
EPS (Basic)$-0.30
EPS (Diluted)$-0.30
Shares Outstanding (Basic)340.17M
Shares Outstanding (Diluted)340.17M

Key Highlights

  • 1Revenue increased by 45% year-over-year to $1.275 billion in Q3 2021.
  • 2Total Orders grew by 47% to 347 million in Q3 2021.
  • 3Marketplace GOV increased by 44% to $10.4 billion in Q3 2021.
  • 4Net loss widened to $101 million in Q3 2021, compared to $43 million in Q3 2020, driven by increased operating expenses and stock-based compensation.
  • 5Contribution Profit increased to $281 million, but Contribution Margin decreased to 22% due to higher acquisition costs and product costs.
  • 6The company ended the quarter with a strong liquidity position, holding $2.9 billion in cash and cash equivalents and $1.3 billion in short-term marketable securities.
  • 7Significant investments were made in R&D and Sales & Marketing, with R&D expenses nearly tripling year-over-year, largely due to stock-based compensation.

Frequently Asked Questions

DoorDash reported a strong revenue performance in Q3 2021, with revenue increasing by 45% year-over-year to $1.275 billion. This growth was primarily driven by a significant increase in Total Orders and Marketplace Gross Order Value (GOV).

While DoorDash experienced significant revenue growth, the company reported a net loss of $101 million for Q3 2021, an increase from the $43 million net loss in Q3 2020. This was mainly due to increased operating expenses, particularly in sales & marketing and R&D, amplified by stock-based compensation. However, the company maintains a strong liquidity position with $2.9 billion in cash and cash equivalents and $1.3 billion in short-term marketable securities as of September 30, 2021, which is expected to cover working capital and capital expenditure needs for at least the next 12 months.

The increase in operating expenses was driven by significant investments in growth initiatives. Sales and marketing expenses rose 54% due to higher advertising and brand marketing, and research and development expenses nearly tripled year-over-year, largely attributable to increased stock-based compensation expenses related to IPO-triggered equity awards. General and administrative expenses also saw an increase, primarily driven by stock-based compensation and higher headcount.

DoorDash faces several key risks. Significant ongoing legal and regulatory challenges related to Dasher classification as independent contractors could materially impact its business model if reclassified as employees. Intense competition in the delivery market, the need for cost-effective acquisition of merchants, consumers, and Dashers, and managing rapid growth are also key challenges. Furthermore, the company's future growth may be impacted by the waning effects of the COVID-19 pandemic on order volumes and potential regulatory actions, such as price controls on delivery platforms.