finance
Uber, DoorDash and Instacart Beat Quarterly Expectations, Driven by High-Income Customers
The three gig-economy companies reported stronger-than-expected earnings this week, with stocks rising afterward. Paid memberships, luxury ride options and value-focused retail partnerships helped offset budget-conscious consumers. Executives highlighted a barbell strategy serving both ends of the income spectrum.
May 9, 9:18 AM·2m read1 source
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Uber, DoorDash and Instacart largely beat quarterly expectations this week and saw their stocks lift. High-income consumers buoyed the results even as some households trimmed budgets amid rising gas prices. DoorDash said signups for its DashPass membership grew during its first quarter.
The service costs $96 a year. Uber has about 50 million members in its Uber One program, which also costs $96 a year. Those users make up about half of the app's bookings, CEO Dara Khosrowshahi said on an earnings call Wednesday.
He described Uber's "barbell" strategy that caters to both customers trying to save money and those with more to spend. The company unveiled offerings including the option to order a beverage or snack along with an Uber Black ride and to have a courier buy something at a local mom-and-pop store.
In March, Uber rolled out Uber Elite, an invite-only ride service using professional drivers and luxury vehicles. Black car rides and other high-value modes have been a focus for Lyft over the last few quarters, CEO David Risher said on the company's earnings call on Thursday. Instacart gained traction among retailers that offer the same prices on the Instacart app as in their stores.
Those retailers perform better than those that mark up their prices, CEO Chris Rogers said on a Wednesday call. "Customers are seeking value, and the retailers on our platform who are delivering it, they're growing faster," Chris Rogers said. DoorDash also gained traction last year among baby boomers, according to data from polling firm Morning Consult.
The generation tends to hold more disposable income than younger cohorts. Some cost-conscious customers use the Uber app as an alternative to car ownership. Brian Mulberry, chief market strategist at Zacks Investment Management, said such users view the service more like a utility than a source for occasional discretionary rides.
