DoorDash is experiencing a significant surge in its grocery delivery business, a key sector that highlights its ongoing evolution in the local commerce marketplace. Recent financial reports reveal that the company has achieved record-breaking quarterly growth, with total orders rising by 19% and revenue increasing by 23%, reaching an impressive $2.6 billion.

CEO Tony Xu noted during the August 1 earnings call that increases in order frequency are not confined to restaurants; they are also driven by new verticals. He emphasized that geographic factors and the diversity of selections available play crucial roles in this growth. “We see order frequency increases both within restaurants and incrementally on top of that from new verticals,” Xu explained.

The commitment to expanding its grocery offerings has been evident for three years, as DoorDash has integrated more retailers and consumer packaged goods (CPG) companies into its platform. This expansion reflects a strategic focus on increasing order frequency overall, which CFO Ravi Inukonda detailed further by stating the company’s method of tracking frequencies in a more segmented manner.

DoorDash’s grocery sector has recently gained momentum, with the addition of over 400 locations of Save A Lot, along with partnerships with Vallarta Supermarkets and Wakefern Food Corp. This growth positions DoorDash as an essential player in the grocery delivery market, appealing to a customer base increasingly seeking convenient shopping options.

Moreover, the company is leveraging its grocery successes to bolster its advertising endeavors. Xu remarked on the rapid progress of its CPG advertising business, indicating that the health of the marketplace remains a priority before monetization strategies are applied.

As DoorDash continues to grow, its focus on optimizing its grocery services, alongside its restaurant offerings, suggests a promising trajectory in the competitive landscape of food delivery services.