Grubhub Reported Second Quarter Financial Results

Grubhub (NYSE: GRUB)announced on Wednesday that it has agreed to acquire the mobile food-order startup LevelUp for USD 390 Million in cash. Shares rose over 22% in Wednesday trading after the announcement.

LevelUp, based in Boston and launched in 2011, offers a site that manages digital ordering, payments and loyalty for chains like KFC, Taco Bell, Bareburger, and Roti. Grubhub founder and CEO Matt Maloney said the purchase of LevelUp allows the Company to improve its restaurants’ point-of-sale systems for a larger order volume, and that LevelUp can help Grubhub build a restaurant platform that goes beyond delivery, like managing customer interactions via mobile and the web.

LevelUp will be fully integrated into the Grubhub team once the regulatory waiting period is over. Chief Executive Officer of LevelUp, Seth Priebatsch, reported that in the short term there will be little change besides the POS integrations and in the long term LevelUp could continue to operate as its own within the Grubhub platform.

The announcement of the deal came when Grubhub released its second quarter earnings. Its revenue increased 51% to USD 239.7 Million from the previous year. Its active diner count increased 70% to USD 15.6 Million. The Company’s revenue (USD 983 Million) came ahead of analysts’ estimates (USD 966 Million) in the second quarter. Grubhub’s profit more than doubled at USD 30.1 Million. Adjusted earnings were USD 0.50 a share while analysts’ estimates at USD 0.41. Its stocks have more than tripled over the past year trading at USD 133.61.

Leave a Comment