(Bloomberg) -- GrubHub Inc. sank on Monday after the company blamed rising competition in the food delivery market and increasingly “promiscuous” customers for disappointing revenue trends.
The Chicago-based company tumbled as much as 28% in extended trading after projecting fourth-quarter revenue of $315 million to $335 million. That fell well short of the lowest estimate of analysts tracked by Bloomberg at $368 million.
“Supply innovations in online takeout have been played out and annual growth is slowing,” Chief Executive Officer Matt Maloney and Chief Financial Officer Adam DeWitt said in a letter to shareholders. “The easy wins in the market are disappearing a little more quickly than we thought.”
GrubHub said the online takeout market is returning to a “more normal longer-term state” in which growth will probably settle in the low-double digit range.
If GrubHub’s losses hold on Tuesday, the stock would trade at the lowest since 2017. The shares have fallen 60% from a record closing high in Sept. 2018, based on Monday’s closing price.
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