Instacart Opens Fiscal Year With a Bang
Instacart’s books got a lot of attention this week, as it announced the acquisition of another business, Wynshop, and released its first quarter earnings. The grocery tech company kicked off its year by beating analyst expectations, posting revenue of $897 million versus projections of $838.5 million for a 9% year-over-year (YoY) lift. Net income came in at $106 million and adjusted EBITDA hit $244 million for the period.
In another key indicator of business health, Instacart reported that orders rose 14% YoY, the fastest pace in 10 quarters. Although average order value dipped 4%, gross transaction value (GTV) went up 10% in that time frame. According to Instacart, that’s the fifth consecutive quarter of double-digit GTV growth.
Beyond order increases, advertising revenue fueled performance in the quarter. At the same time, the company is building on momentum by bringing on new Carrot Adds partners like Hy-Vee and Uber Eats.
“As the category leader, our operating goal is clear: accelerate the adoption of online grocery. We’re executing on this through relentless product innovation across the four dimensions consumers care about most: convenience, affordability, quality, and selection,” declared CEO Fidji Simo in a letter to shareholders. “The scale we operate at and the unique insights we’ve gained from 13 years of data give us an edge and velocity to innovate in ways others can’t.”
To continue that acceleration mission, Simo recapped several strategies that Instacart will focus on in the near future, including AI-based tools such as pairing suggestions and personalized Health Tags and value-focused offerings like $0 delivery fees on $10 minimum baskets.
The company also announced this week that it is expanding its partnership with Chase. Now, Chase cardmembers with eligible credit cards, including Marriott Bonvoy; Southwest Rapid Rewards; IHG One Rewards; Aer Lingus, British Airways, and Iberia Plus Visa Signature; Aeroplan; and World of Hyatt, will gain immediate access to three free months of Instacart+ and monthly $10 in-app credits. The benefits also extend to eligible Chase Ink Business Cardmembers,
In addition to consumer-facing activities and results, Instacart provided an update on ways that it is enhancing partnerships with retailers. The company touted its Store View AI-based tool that uses computer vision and videos of store shelves to better predict out-of-stocks and reduce substitutions. On the brand partnership front, Instacart cited the increased use of its Universal Campaigns, a program that provides AI-powered ad technology for large and emerging brands.
Looking ahead, Simo affirmed that Instacart is on track to delivery annual adjusted EBITDA expansion this fiscal year.
A grocery technology company based in San Francisco, Instacart works with more than 1,800 national, regional and local retail banners to facilitate online shopping, delivery and pickup services from 100,000-plus stores across North America on the Instacart Marketplace. Maplebear Inc. is the registered corporate name of Instacart.
