Report: Coronavirus Grocery Delivery Demand Has Made Instacart Profitable For The First Time

Demand for grocery delivery has exploded in recent weeks as millions try to avoid going outside amid the COVID-19 pandemic. Instacart is one of the major beneficiaries of this boom. It’s hiring hundreds of thousands more contractors to help it fulfill orders, and the surge in demand has reportedly made the company profitable for the first time.

Instacart expects to make a net profit of around $10 million in April, according to The Information. The eight-year-old company is said to have lost a total of $300 million last year.

Customers reportedly bought around $700 million worth of goods through the service in each of the first two weeks of April. That’s an increase of about 450% from December, the report suggests. Instacart declined to comment to The Information about its finances. It mainly makes money through delivery fees, taking a percentage of grocery orders and ads on its app.

Whether Instacart can sustain that kind of momentum is up in the air, however. As sheltering in place measures start to ease, more people will likely return to stores to buy their own groceries. In addition, millions of people are losing their jobs in the current climate, and might not be willing to pay Instacart’s fees. Increased competition, particularly as the likes of Uber move into grocery delivery, don’t bode well for Instacart’s prospects either.

Still, people might embrace the convenience of having their weekly shop dropped off at their door in the long run. Even if many customers do decide to stop using Instacart once the global climate improves, the company will have their contact information and might lure them back with enticing offers.