Key points from DoorDash, Airbnb, Roblox, Wish, Affirm S-1 filings

Tech investors have a lot to read on Thanksgiving Holiday as an IPO filing. DoorDash, AirBnB, Effirm, Roblox and Wish all revealed their prospects over the last eight days, with plans to go public before the end of the year.

They are taking advantage of the post-election rally that has lifted the US stock index near record highs and there is a clear demand in the public market for high growth investment.

All five companies serve consumers and can expect a busy holiday season in the face of coronovirus cases and a drastically transformed economy. This is a very different slate of market entrants than the previous crowd in September, when several enterprise software companies such as Snowflake and Palantir made their debut.

Each has different narratives associated with coronovirus.

Dordash’s revenue more than tripled in the third quarter as many restaurants turned to distribution as their primary of business. Children’s gaming platform Roblox reported a 91% revenue increase in the most recent quarter (measured last year), as it benefited from school closures and more users looking for ways to stay away from their friends.

Affirm, which provides point-of-sale online loans to consumers purchasing apparel, electronics, household goods and other items, has nearly double revenue in the latest quarter as people increasingly turn to the internet for their purchases. Huh. I wish, the online discount retail marketplace would have been benefiting from the ecommerce boom as well. But its third quarter growth was 33% higher, as most of its traders are based in China and still dealing with supply chain challenges.

Airbnb is the worst-hit company by the epidemic, which has devastated the travel economy. But it has found a niche in combining holiday homes with remote work and positioning itself for an economic rebound.

What we learned from each company’s S-1 filings were listed in the same order they were filed:

Read full filing here

Top Line: Revenue rose to $ 879 million in the third quarter from $ 239 million a year before order growth of 237%. For the first nine months of the year, orders increased to 543 million from 181 million in the same period last year.

Ground level: Net loss was limited from $ 152 million to $ 42 million an ear earlier. During the three quarters of 2020, DoorDash generated a positive contribution margin of 23% compared to the previous year’s negative margin of 32%, meaning that the company is, on average, making money from every order.

Story of Kovid: DoorDash has leveraged its share gains in recent years – it has about 50% control over the US food delivery market – to get its brand in front of consumers at the time they are ordering food at unprecedented rates. Americans will eventually return to eat out, and restaurants dependent on delivery will continually seek more economical ways to operate. As Dordash warns in its prospectus: “Circumstances that have triggered an increase in total orders stemming from the effects of the COVID-19 pandemic may not continue in the future, and we will see future aggregate rates of decline. Let’s expect a growth rate. “

Read full filing here.

Top Line: Third quarter revenue fell 18% from a year earlier to $ 1.34 billion. This is a major decline, with a drop in steeper bookings expected in the fourth quarter as the epidemic is keeping people closer to home. But people are using Airbnb for non-urban rentals and finding creative ways to work remotely to help improve the company’s weather compared to hotels, airlines and online travel agencies.

Ground level: Airbnb reported net income of $ 219 million in the third quarter, a slight decline from a year earlier. The company cut its workforce by 25% in May and slashed marketing budgets, leading to a 75% drop in sales and marketing costs.

Story of Kovid: AirBNB was poised to become the technology IPO of the coming year in 2020, valuing $ 35 billion with the continuing promise to change the way consumers travel. When business began late in the first quarter, AirBnB had to turn to debt markets, which raised $ 2 billion in high-interest loans, and cut its valuation. Potential long-term investors may see AirBnB’s ability to adapt to a new reality faster than its rivals as we are now with the hope that we will not be closed forever.

Read full filing here

Top Line: For the period ended September 30, revenue jumped 98% to $ 174 million from a year earlier. The most growth came from its merchant network, online businesses that offer Affirm loans when purchasing items. The company works with more than 6,500 merchants, including Peloton, West Elm and Pottery Barn, and has partnerships with Shopify.

Ground level: The net loss in the quarter was about $ 15.3 million compared to a year earlier. On a percentage basis, sales and marketing saw the biggest cost increases, where spending for its new relationship with Shopify quadrupled to $ 22.6 million.

Story of Kovid: The number of active consumers increased to 3.9 million in the quarter from 2.4 million a year ago. The direct-to-consumer trend that is boosting online commerce and boosting Shopify’s stock is also driving Affirm. Look no further than the peloton, which accounts for 30% of Affirm’s revenue and is booming in the home. Peloton’s revenue more than tripled in the latest quarter and the stock grew 290% this year.

Read full filing here

Top Line: Revenue increased 91% to $ 242 million in the third quarter. The company’s gaming platform lets children create an avatar they can take between games, and spend money on a virtual currency called Robux for premium features. Daily active users were 36.2 million in the quarter ended September, almost a year earlier. One metric company doubled “Took hours” to 8.7 billion.

Ground level: Net loss in the third quarter doubled to $ 48 million from a year earlier. Sales and marketing costs were flat, but there was a huge increase in developer exchange fees, which tripled to $ 81.9 million. Roblox shares this money with game developers when consumers spend money in their titles. The company states in its prospectus, “Many users eventually become developers and creators, and nearly all developers and creators begin as users.”

Story of kovid: In addition to spending more time and money on apps because they are home, users are also hosting virtual birthday parties and other celebrations on Robox, generating another revenue stream for the company. While Roblox has lured many more users during the epidemic, who are likely to keep using the app, there won’t be as many screen hours available just when schools reopen.

Read full filing here

Top Line: Revenue increased 33% to $ 606 million in the third quarter. I wish, known for deep discounts, continue to benefit from online commerce, and increased comfort that consumers are buying from their phones. Monthly active users increased from 108 million in the first nine months of 2020 to 81 million in the same period a year earlier.

Ground level: A 13% drop in sales and marketing costs narrowed the net loss from $ 134 million to $ 99 million as the company shifted investment to its logistics platform.

Story of Kovid: Wish was particularly exposed to the early days of the epidemic as most of its traders are based in China, where Kovid-19 first began to spread. Revenue dropped in the first quarter, then picked up in the second. But the company said merchants continue to suffer from supply chain disruptions and slow delivery times in various parts of the world.

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