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Instacart to cut 250 jobs as slowing ad business counters upbeat Q1 forecast, ETHRWorld


hr.economictimes.indiatimes.com | www.ETHRWorld.com

<p>As of June 30, Instacart had 3,486 employees, according to a regulatory filing</p>
As of June 30, Instacart had 3,486 employees, according to a regulatory filing

By Granth Vanaik

Instacart forecast on Tuesday its first-quarter gross transaction value (GTV) and core profit above estimates due to an uptick in grocery orders, and said it plans to cut 250 jobs, or 7% of its workforce, to focus on “promising” initiatives.

Shares of Instacart reversed course to be down about 5% after the bell following Instacart’s lower-than-expected fourth-quarter revenue on slowing advertisement business.

As of June 30, Instacart had 3,486 employees, according to a regulatory filing.

“We are seeing (some weakness among advertisers) in pockets, but it is not widespread,” said CEO Fidji Simo on a post-earnings call.

Ad and other revenues increased 7% in the fourth quarter, compared with a 19% growth in the previous quarter.

“Advertising business has slowed down,” CFRA Research’s Arun Sundaram said, adding that this would cause a bit of concern because it was historically a very fast growing and high-margin business for the company.

Total revenue rose 6% to $803 million, falling short of analysts’ expectations of $804.2 million.

Transaction revenue growth slowed sequentially to 6%, as Instacart offered more incentives and promotions to attract customers, especially during the holiday season, amid stiff competition from rivals such as DoorDash, UberEats, Amazon.com and Walmart.

Total orders rose 5% to 70.1 million in the…


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