JET Q3 - Europe Grows, Grubhub Falters

Square releases AI for restaurants, Amazon drone delivery for pharma, mall foot traffic falls

Oct 18, 2023

Ahh, it’s the start of Q3 earnings season, with Just Eat Takeaway.com kicking things off with some geographically mixed results. Plus we’ve got some new tools by Square, interesting shopping data, and Amazon’s flying drugs around in the sky. Oh and don’t forget to sign up for our webinar!

Today:

JET-ting up in North Europe, Down in North America
Square’s New AI-Powered Restaurant Tools
Chart Time | Mall Foot Traffic Falters in September
Amazon’s Drug Dealing Aerial Escapades Head to Texas

3PD | Just Eat Takeaway Claws Its Way Towards Profit in Q3

Multinational delivery giant Just Eat Takeaway.com was the first of the 3PDs to release a Q3, and it shows how improved operational efficiency can make up for wobbling GTV growth. Gross transaction volume fell 7% YoY, but accounting for exchange rates it was only down 3%. Slicing that by territory it’s a different picture: Northern Europe was up 5% (constant currency,) and the UK and Ireland were up 5%. Southern Europe and Australia New Zealand were down 11%, but those account for a small portion of its overall business; the real issue was in North America, where Grubhub and Canada’s SkipTheDishes saw GTV down 11% as well.

The Big Picture: Through increased operational efficiency, the company managed to improve its burn despite the top line GTV declines. JET changed its adjusted EBITDA for the year to €310 million, up from €275M, and is expecting to be free cash flow positive in mid-2024. The company projects it can even get North America to be cash flow neutral, but it’s still exploring a sale of that unit. Oh and to keep the stockholders happy, it launched a €150 million buyback — shares in the Amsterdam-listed company popped 3% on the announcement, before ending the day down two percent.

WEBINAR | Restaurateurs Fight Delivery Charges, 10/26

Does switching from 3PD to 1PD save you on commission or ultimately cost you customers? How can restaurant tech providers justify their cost structures in the wake of Toast’s fee debacle? Which are the value added services that are worth their cost to restaurateurs and retailers? Join us on 10/26 at 10 AM Pacific as we hear from Restaurant Dive’s Lead Editor Emma Beckett, as well as two restaurant tech founders and a scrappy pizza operator, to learn the latest lay of the land.

ONLINE ORDERING | Square Releases New Restaurant AI Tools

Payment service provider Square unveiled a host of new features for restaurateurs and retailers, many of them powered by generative AI. For restaurants, machine learning can create an entire menu for you, for retailers it will spruce up your product listing photos, and for both it will generate pablum… err we mean delightful descriptions of your offerings. Square also announced new tools for kitchen workflows, auto-assigning menu items to appropriate categories / station screens and delegating staff as necessary.

The Big Picture: On one hand, it’s definitely convenient for a small business that with the click of a few buttons, Square will cook up an entire website for you to have you accepting online orders in no time flat. But if you’re relying on an AI to generate menu *ideas* (the promo shows the computer helpfully informing you that an “all day Italian” menu should include both arancini and ahi tuna,) perhaps you’re in the wrong line of work?

CHART TIME | Mall Traffic Struggles in September

New data from Placer.ai shows we just wrapped up a tough month for mall-based retailers. Indoor mall visits fell 6.9% YoY, while outdoor held up better (-2.5%) perhaps given consumer preferences to shop en plein air when it’s warm outside. Somewhat counterintuitively, outlet malls fell hardest, 8.7%, which goes against other data suggesting consumers are pinching pennies to fight back against inflation and declining federal benefits. Given that NRF data shows overall retail sales inched up 3.8% YoY in August, it looks like that if people are fleeing the mall, they’re still shopping locally and online.

DRONES | Amazon Pharmacy Launches Aerial Delivery

Amazon’s Prime Air subsidiary is launching drone-based delivery of prescriptions, starting off in College Station, Texas. The service is free and promises delivery in one hour or less. Amazon Pharmacy offers about 500 medications, including those for common conditions like the flu, asthma, and pneumonia. Amazon’s drones are equipped with aerial detection sensors, and are certified to fly out of an operator’s sight, making the service semi-autonomous.

The Big Picture: While College Station (population 120,000) is small enough that you could make a delivery in an hour on a bicycle, pharmaceuticals are one of the areas where aerial delivery shows real promise. For one, they’re lightweight but still often pricy. For two, customers might be too infirm to get them themselves. And if Amazon gets the autonomy working well, there are real labor cost savings compared to ground-based methods of delivery. Amazon has previously trialed Prime Air in California’s Central Valley, while many other drone players like Flytrex, Wing and DroneUp ply the skies of North Texas.

A Few Good Links

PayPal launches package tracking. Retailers shed inventory. Instacart Q3 to be announced 11/8. Domino’s appoints new EVP of HR. Chipotle is the latest chain to push back opening hours (and launch a novelty Halloween menu item.) Starship robots launch at University of Akron (why is the school’s mascot a demented kangaroo?)

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