Just Eat books €3 billion loss on Grubhub as rampant losses continue

– Orders fall but revenues rise as costs weigh on consumers

– Analysts are not buying a positive 2023 EBITDA target

– The loss of 3 billion euros recorded for Grubhub may not be the end of the American disaster

How about that for inflation; Just eat take out (JET) saw orders fall 7% in the first half (through June 30, 2022), but revenue grew 7% as cost increases were passed directly to consumers. How much and for how long diners will be willing to put up with rising prices for dinners delivered to homes remains to be seen, but investors should beware.

Management reaffirmed GTV’s (gross transaction value) guidance for full year 2022 of single-digit growth and adjusted EBITDA (earnings before interest, tax, depreciation and amortization) margin between -0.5% and -0.7% of GTV.


Berenberg analysts estimate nearly 800 million euros in net losses this year, and that assumes further cost control initiatives in the second half. The investment bank certainly isn’t buying management’s talk of positive adjusted EBITDA for fiscal year 2023. Berenberg forecasts net losses of 530 million euros and 378 million euros for 2023 and 2024, respectively.

Just Eat also recorded a loss of 3 billion euros on its American company Grubhub, bought for 7.3 billion dollars just two years ago. Still, that only looks like part of the financial disaster that Grubhub will end up being, with some analysts predicting a final sale price of less than $1 billion.

The London-traded share rose 4% to £16.17 in response, but it’s not easy to see why. The share price traded near £100 a few years ago, and getting back there feels like a bridge too far.

Date of issue: August 03, 2022

About Marcia G. Hussain

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