REUTERS - Online food delivery company GrubHub Inc reported a 78 percent rise in quarterly profit as its efforts to attract new diners paid off.
Net income attributable to stockholders rose to $17.7 million, or 20 cents per share, in the first quarter ended March 31, from $9.9 million, or 12 cents per share, a year earlier.
The company forecast revenue of $153 million-$161 million for the current quarter. Analysts were expecting revenue of $158 million, according to Thomson Reuters I/B/E/S.
GrubHub’s shares rose 11.6 percent to $39.1 in premarket trading on Thursday.
The company has been beefing up its product offerings and spending heavily on marketing to attract more users to its service amid intensifying competition.
Chicago-based GrubHub, which competes with Amazon.com Inc’s Prime Now and Yelp Inc’s Eat24, allows diners to order from more than 50,000 takeout restaurants in over 1,100 U.S. cities and London.
GrubHub’s early entry into tier-2 and tier-3 cities in the United States has given it an advantage over peers.
On an adjusted basis, the company earned 29 cents per share.
GrubHub’s number of active diners rose 26 percent to 8.75 million. Analysts had expected about 8.54 million active diners, according to market research firm FactSet StreetAccount.
Revenue rose 39 percent to $156.1 million.
Reporting by Rishika Sadam in Bengaluru; Editing by Saumyadeb Chakrabarty