Grubhub Parent Takes $3 Billion Write-Down on Food-Ordering Service #Grubhub #Parent #Takes #Billion #WriteDown #FoodOrdering #Service Welcome to Lopoid
Grubhub’s parent company has written down the value of the online food-ordering service by 3 billion euros, equivalent to a little over $3 billion, just a year after buying the pandemic-era darling for $7.3 billion.
Just Eat Takeaway.com
NV said Wednesday it was taking the impairment because of a reduction in comparable valuations in the sector, among other factors. The Amsterdam-based company said it is continuing to explore the partial or full sale of the U.S. business.
The moves come as Grubhub grapples with a slowdown in online food-delivery orders that boomed during the Covid-19 pandemic. But consumer behavior is now changing, while competition with other services remains fierce.
Just Eat reported a 10% fall in orders in North America to 171.4 million for the six months ended June 30, but gross transaction value in the region was broadly unchanged at around €5.8 billion. It said reduced order volume was most pronounced in the U.S.
Once the market leader in online restaurant food ordering in the U.S., Grubhub now lags behind
Uber Technologies Inc.’s
To expand its user base, Grubhub has worked to strike deals and promotions. Those include an agreement with
announced last month to link part of Grubhub’s food-ordering service with the e-commerce giant’s Prime program.
Still, the acquisition of Grubhub has proved a headache for Just Eat, with shares in the European company falling sharply since it bought the U.S. business.
Within months of closing the deal in June 2021, some investors were calling for Just Eat to sell Grubhub and focus on its core operations in Europe. Just Eat said in April that it was exploring a strategic partner or partial or full sale of Grubhub.
On Wednesday, Just Eat said its first-half net loss had significantly widened because of the accounting charge linked to Grubhub.
Just Eat reported a €3.48 billion loss for the period, compared with a €486 million loss for the year-earlier period. Revenue for the period was €2.78 billion compared with €1.77 billion for the same period in 2021.
Overall gross transaction value, or GTV—a key metric for the industry—was €14.19 billion compared with €14.12 billion a year earlier. Just Eat management confirmed its guidance for 2022, forecasting GTV to grow by a mid-single digit year-over-year.
—Kyle Morris contributed to this article
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