DoorDash (DASH:NYSE) jumps on earnings, Applied Materials (AMAT:NASDAQ) Q1 performance shows bright spots for chip market


DoorDash (DASH:NYSE) shares jumped 7% after the online food delivery company reported a revenue beat and upbeat guidance. The company’s fourth-quarter revenue came in at $1.82 billion, topping the $1.77 billion estimated by Wall Street analysts.

Reported losses, however, were greater than analysts’ projections, coming in at a per-share loss of $1.65 versus analysts’ estimates of 68 cents.

DoorDash attributed the wider-than-expected loss for the fourth quarter to charges related to its acquisition of Finnish food delivery company Wolt, and stock-based compensation expenses related to the layoffs last November, which resulted in 1,250 jobs being cut.

DoorDash said the total number of orders it delivered in the fourth quarter grew 27% to 467 million, which topped Wall Street’s projections for roughly 458 million orders. Its core U.S. restaurants business were profitable on an adjusted basis and that it was investing in building businesses overseas and expanding into new categories like grocery delivery.

For the current quarter, DoorDash said it expects marketplace gross order volume to be between $15.1 billion and $15.5 billion. The company expectsadjusted earnings before interest, taxes, depreciation and amortization to range from $120 million to $170 million. For the full year, DoorDash said it expects adjusted Ebitda to almost double from last year to the $500 million to $800 million range.

In November, DoorDash said it was laying off around 1,250 people. At the time, Chief Executive Tony Xu apologized for growing head count so quickly and said the cuts were the most difficult announcement in the company’s close to 10-year history.

DoorDash shares have underperformed the broader market over the past 12 months. Through Thursdays’s close, its stock was down about 30% from a year ago, while the tech-heavy Nasdaq Composite Index was down roughly 16%.

Orders for delivery companies DoorDash, Uber Technologies Inc.’s Uber Eats and others skyrocketed during the pandemic as people avoided going out to restaurants. While the two largest food-delivery apps in the U.S. are still growing, the pace of growth has cooled in recent months. The companies are contending with soaring inflation that is crimping consumer spending power.

DoorDash and Uber Eats have been offering discounted deals to new subscribers, tweaking their apps to try to trigger more spending and moving beyond food to give people more reasons to return. They are also trying to keep restaurants from ratcheting up delivery prices while offering them new services.

DoorDash said in the quarterly earnings report that its president and COO Christopher Payne will retire from the company. Payne will be succeeded by DoorDash CFO Prabir Adarkar, who will take over the COO role effective March 1. Ravi Inukonda, DoorDash’s vice president of finance and strategy, will become CFO.

Applied Materials (AMAT:NASDAQ) stock added about 2% after the semiconductor company posted its latest results. Shareholders earned $2.03 per share, excluding items, in the first fiscal quarter, topping a consensus estimate of $1.93 per share.

Revenue was $6.74 billion in the same quarter, beating analysts’ estimates of $6.69 billion. Meanwhile, the company lowered its guidance for the second fiscal quarter, citing ongoing supply chain challenges.

For the current quarter, the company expects net sales to be approximately $6.40 billion, plus or minus $400 million vs. $6.33B consensus, which includes ongoing supply chain challenges and a negative estimated impact of $250 million dollars related to a cybersecurity event recently announced by one of our suppliers. Non-GAAP adjusted diluted EPS is expected to be in the range of $1.66 to $2.02 vs. $1.76 consensus

Many of Applied Materials largest customers have slashed their budgets for new plants and equipment this year in response to a widespread glut. But its latest outlook suggests there are still bright spots in the chip industry, including automotive semiconductors.

Applied Materials also is benefiting from better access to some components, helping it fill an order backlog that had grown during the pandemic. Shares of the semiconductor manufacturer are down.