Europe and the US’s top online food delivery companies have collectively lost over $20bn (£15.6bn) in operating losses over the past seven years as the stocks languish.
Following the pandemic-induced surge in demand, shares in pandemic darlings Deliveroo, Just Eat Takeaway (JET), Delivery Hero, and Doordash have plummeted amid a macroeconomic climate that has led to weaker consumer spending.
These firms have seen their cumulative annual operating losses reach $20.3bn (£15.9bn), according to analysis by the Financial Times and industry expert Thedelivery.world.
The figure spans the seven years since Deliveroo, Delivery Hero, and Doordash went public and includes the period after Just Eat Takeaway emerged from a 2020 merger.
The stock prices of the delivery giants have languished since the highs of the pandemic era.
The total also reflects significant writedowns from acquisitions and stock-based compensation.
JET, the merger of UK-based Just Eat and Netherlands-based Takeaway.com, has racked up operating losses of $9.1bn (£7.1bn) since its formation in 2020.
Delivery Hero, which went public in 2017, has reported operating losses amounting to $7.8bn (£6.1bn) while Doordash, listed in 2020, has experienced operating losses of $2.6bn (£2bn).
Deliveroo, which entered the public market in 2021, has posted operating losses of $777m (£609m).
UBS analyst Jo Barnet-Lamb said: “Investors’ willingness to fund losses has changed” and they now want food delivery businesses to “demonstrate sustainable, profitable growth” following a rise in interest rates.
In February, Uber reported its first full-year operating profit after years of losses. Chief executive Dara Khosrowshahi said, “2023 was an inflection point” for the company. Uber said its Eats division turned profitable for the first time in 2022.
The New York-listed stock is up 58 per cent over the past five years and well above its pandemic peak.
Deliveroo said: “We continue to make strong progress against our strategic priorities and remain confident in our ability to deliver profitable growth.”
DoorDash said the company expected to deliver “[generally accepted accounting principles] profitability over time” and it has invested billions to help sellers build successful businesses.
Emmanuel Thomassin, chief financial officer at Delivery Hero, said operating losses included “items which are not considered as operational relevant to measure the economic development of the company”. He said the company is more focused on other metrics such as free cash flow.
JET declined to comment.