What explains Doordash's dramatic profit turnaround in late 2024?

DoorDash's dramatic profit turnaround in late 2024 can be attributed to several key factors:

1. **Increase in Sales and Market Expansion**: DoorDash reported a significant increase in sales, which contributed to its return to profitability. This growth was driven by strong performance in total orders and Marketplace Gross Order Value (GOV), enhanced logistics efficiency, and increased contribution from advertising.
2. **New Vertical Expansion**: The company's expansion into new verticals, such as grocery and retail, has been paying off. This diversification has likely led to increased revenue streams and customer base expansion.
3. **Partnerships and Collaborations**: Strategic partnerships, like those with Warner Bros. Discovery’s WBD streaming service Max, JPMorgan Chase & Co.’s JPM U.S. consumer and commercial banking division Chase, and Academy Sports and Outdoors ASO, have bolstered investor sentiment and contributed to the surge in orders.
4. **Technological Innovations**: The introduction of innovative partnerships, such as SafeChat+ feature, reflects DoorDash's commitment to enhancing user safety and trust, which could have boosted customer confidence and loyalty.
5. **Financial Efficiency**: The company's financial efficiency is highlighted by its adjusted gross profit margin expanded by 270 basis points to 51.2%, and the contribution margin was 33.7% compared to 29.9% in the year-ago quarter. Adjusted EBITDA was $566 million compared with the year-ago quarter’s $363 million.

In summary, DoorDash's profit turnaround is a result of a combination of increased sales, market expansion, strategic partnerships, technological innovations, and financial efficiency.

|code|Ticker|Name|Date|Percentage Change|market_code|
|---|---|---|---|---|---|
|DASH|DASH.O|Doordash|20241230|0.1535|185|
|DASH|DASH.O|Doordash|20241231|-1.0908|185|