Investors Dash Away From DoorDash After Weak Q2 Guidance

DoorDash (DASH) - ★★★★ - Ranked #34 in Q2 2024 Large Cap Equity Rankings

Shares of food delivery company DoorDash (DASH) plunged as much as 13% in premarket trading Thursday, falling below $110 per share. The steep sell-off came after the company released its first quarter earnings report and provided guidance for the upcoming second quarter that fell short of Wall Street's expectations.

For the second quarter, DoorDash forecasted adjusted EBITDA between $325 million and $425 million. The analyst consensus revenue forecast was around $390 million.

The downbeat revenue outlook signals that DoorDash is potentially expecting softer demand in the upcoming quarter. Despite the negative forecast, DoorDash did report better-than-expected earnings for the first quarter.

The disappointing Q2 guidance renewed investor concerns about the company's ability to control expenses and maintain profitability, especially as it faces intensifying competition in the crowded food delivery market. Fears that consumer spending could also start to moderate further pressured the stock.

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