Ahead of its upcoming initial public offering (IPO), online grocery delivery company %Instacart has unveiled that it turned a profit of $428 million last year, a rare feat for a start-up company.
The profit was revealed in the company’s offering prospectus that gives investors a first look at its finances.
However, while it is going public as a profitable business, Instacart’s financials show that growth at its grocery delivery business is slowing coming out of the Covid-19 pandemic.
Instacart rode the pandemic stock market boom and crashed along with the rest of the technology industry when the rally faded in 2022.
Consequently, Instacart has laid off workers in recent months and lowered its valuation from $39 billion U.S. to about $10 billion U.S. currently.
Instacart’s IPO, which is expected in September of this year, is expected to serve as a litmus test for equity markets and tech start-ups.
Only about 100 companies with market valuations over $50 million U.S. went public in the U.S. in 2022, compared with 397 in 2021, according to Renaissance Capital, which tracks listings.
British chipmaker Arm is also expected to go public this autumn in what could be the biggest IPO of the year.
Instacart’s finances show that the company earned $428 million U.S. in profit in 2022, compared with a $73 million U.S. loss the year before.
Its grocery orders in 2022 grew 18% from 2021, but orders in the first half of this year were flat compared with a year earlier, the company said.
Instacart was founded in San Francisco in 2012. It previously raised $2.7 billion U.S. in funding from Silicon Valley investors such as Sequoia Capital and Andreessen Horowitz.
In its offering prospectus, Instacart lists risk factors such as a history of losses, its dependence on retailers, and intense competition in the grocery delivery space.
Instacart plans to list its shares on the Nasdaq stock exchange under the ticker symbol “CART.” An exact date for the company’s IPO has not yet been made public.