Instacart (NASDAQ:CART) reported an 11% year-over-year increase in gross transaction value (GTV) to $8.3 billion in the third quarter.
Although this result hit targets, Instacart (NASDAQ:CART)’s fourth-quarter projection threw up a warning siren.
Instacart expects fourth-quarter GTV to land between $8.5 billion and $8.65 billion, representing a sequential slowdown in growth from 11% to between 8% and 10%.
A particularly strong 2023 holiday season has set a tough comparative, noted management.
The company achieved a 39% increase in adjusted EBITDA to $227 million in the third quarter, which Instacart attributed to “a combination of strong GTV and total revenue growth, as well as adjusted total operating expense leverage”.
Chief executive Fidji Simo spoke extensively of “the depth of integration with retailers”.
“I cannot emphasize this point enough,” Simo told shareholders. “Retailers that launched at least one new service with us in the previous 12 months – like EBT SNAP, pickup, alcohol delivery, virtual convenience, loyalty integration, or enterprise solutions like Storefront Pro – have grown their sales, on average, nearly twice as fast so far this year as partners without
Launches.”
The lukewarm current-quarter growth forecast has led to a 78% share price decline in Wednesday’s pre-market trades, though at a projected opening price of $44.55, the stock will remain around 100% higher year to date.