Delivery app Waitr posted a loss of more than $77 million in the first quarter of 2022, though it attributed a $67 million chunk of the shortfall to a “goodwill impairment” tied largely to its paltry stock price, according to the company’s latest earnings report.
For comparison, the Lafayette-based delivery app posted a $3.7 million loss in the first quarter 2021.
The company’s revenue also fell by about $15 million in the most recent quarter. Waitr brought in $35 million in the first quarter of 2022, compared with about $50 million for the same quarter last year.
In its latest Securities and Exchange Commission filings, Waitr blamed much of its lagging performance on high gas prices and inflation, which is hurting both its customers and its drivers. To offset the fuel costs, Waitr is offering discounted gas cards to its drivers.
It also partly blamed the declining revenue on a lack of stimulus payments in 2022, “unlike those distributed in the first quarter of 2021,” according to SEC filings.
“As a result, orders were lighter than expected,” Waitr Chair and CEO Carl Grimstad said in SEC filings of high gas prices and inflation. “We believe part of this is due to our smaller, lower income markets and our restaurant selection having limited lower priced (quick service restaurant) options.”
Waitr said the $67 million goodwill impairment is “mainly due to a decline in our stock price and market capitalization in mid-March 2022.”
Waitr’s stock price closed at 21 cents Monday. The company is considering a reverse stock split to bring up the price so it can avoid being delisted by Nasdaq. It has until July to avoid delisting.
Goodwill is an intangible asset that appears on a company’s balance sheet that is typically associated with the purchase of another company. A goodwill impairment occurs when the current value of the goodwill drops below its value at the time of the acquisition.
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Waitr bought a competitor, Delivery Dudes, in March 2021 and a host of payment processing platforms in August 2021.
“The primary factor contributing to a reduction in the (goodwill) fair value was the significant decline in the company’s stock price in mid-March 2022, resulting in a market capitalization that was lower than the carrying value of the Company’s consolidated stockholders’ equity,” Waitr’s SEC filings said.
The delivery app is addressing its slide in part by continuing to expand its offerings, particularly national quick service chains.
Waitr has added Panera Bread to its roster and expects to add 7-Eleven by mid-2022, according to SEC filings. It also signed an agreement to add restaurants owned by Inspire Brands, including Buffalo Wild Wings, Sonic, Jimmy John’s, Rusty Taco, Mister Donut, Dunkin Donuts and Baskin-Robbins, among others.
Waitr is also aiming to expand its delivery services for sporting events. The company offers concession delivery to seats in LSU’s Alex Box Stadium, the University of Alabama’s Bryant-Denny Stadium and the University of Louisiana at Lafayette’s Russo Park.
“We believe that these new partnerships should bring increased visibility, increased diner access, and increased order volume to the company,” Grimstad said.
Amid the poor financial performance, Waitr won’t be “Waitr” much longer. The company said its rebrand to “ASAP” should roll out in the third and fourth quarters of 2022.
“We remain focused on executing these initiatives with the goal to see positive traction during the second half of 2022,” Grimstad said in SEC filings.