said Wednesday it expects to spend more than $50 million in the second quarter on for its .
The San Francisco-based company said in March that it would offer extra compensation to U.S. and Canadian drivers as part of a temporary program to offset a sharp due to the . The national average for a gallon of gas on Wednesday was $4.53, up 44% from a year ago, according to AAA.
DoorDash said demand for deliveries remained strong in the January-March period despite higher gas prices, with total orders rising 27% to 933 million. That fell short of Wall Street鈥檚 forecast of 954 million, according to analysts polled by FactSet. DoorDash said winter storms closed businesses and dampened demand in some locations.
Revenue also fell short of expectations. DoorDash said its revenue rose 33% to $4.0 billion, which was shy of the $4.15 billion analysts were forecasting.
The company said it’s paying for gas price relief by adjusting investments in other areas. DoorDash said in November that it would be on new products and services this year, including the addition of in its app and robot deliveries.
鈥淲e did have to push out some investments … in order to make room for this,鈥� DoorDash Chief Financial Officer Ravi Inukonda said during a conference call with investors. 鈥淚f we do decide to extend the program, our goal is to find offsets.鈥�
DoorDash said its net income fell 5% to $184 million, or 42 cents per share, for the January-March period. That was partly due to a 30% increase in research and development costs compared to the same period last year.
Still, that beat analysts’ forecast of a 36-cent per share profit, according to FactSet.
DoorDash’s shares rose more than 11% in after hours trading Wednesday.
DoorDash’s earnings report came a week after rival Uber announced a that will let users make hotel reservations through the Uber app.
When asked if DoorDash plans to add a similar service, DoorDash Co-founder and CEO Tony Xu said the company still sees plenty of room to grow its core area of restaurant and retail delivery.
鈥淲e are a tiny fraction of what鈥檚 actually available and addressable, which in some sense means that there鈥檚 a large runway and opportunity for us to become even better in breed in terms of what it is that we can offer,鈥� he said. 鈥淎nd if we can keep doing that, I think we鈥檙e going to be just fine.鈥�
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