• 🥚 Good Eggs Acquired By GrubMarket
• 📉 Divestiture, Volume Declines Hurt B&G Foods
• 🍯 Nespresso Unveils Line of Sustainable Honey
• 💰 Terrantic Closes $3.5M Seed Round

Instacart’s core business has moved well beyond its origins in the gig-economy, third-party delivery space as it diversifies deeper into tech-based services. And those efforts appear to be paying off. 

According to an earnings call after market close yesterday, Instacart’s gross transaction value (GTV) rose 10% year-over-year in Q2 to $8,194 million. Both its original business and new ventures are seeing growth with orders up 7% to 70.8 million year-over-year while advertising and other revenue streams grew 11% to $228 million, representing 2.8% of GTV. 

The platform’s gross profit increased 18% to $623 million, and adjusted EBITDA hit $208 million – a 89% increase year-over-year. Total revenue increased 15% to $823 million, but net income was down by $53 million year-over-year, totaling $61 million in Q2. The company’s stock price has risen 3.4% to $32.50 as of this morning. 

According to CEO Fidji Simo, the platform saw over 25 million active users in the past year. The company thinks about its consumers in terms of cohorts, she explained, rooted in the time and conditions around when they joined the platform. Cohort trends were “a significant headwind to 2023 growth,” as the company lapped the dwindling impact of COVID-19-related shopping behaviors, noted CFO Emily Reuter, but now, all new consumer cohorts are reaching bigger basket sizes more quickly than past cohorts. 

“Now, at this point, [in] all of our cohorts, we’re really pleased to see – both mature and new – are healthy. Their behaviors have really normalized… What we are focused on now is deepening engagement with our existing and infrequent customers,” Reuter emphasized. 

Instacart has done just that by diversifying its offerings so that it services suppliers and retailers in addition to the end-customer with discounts and offers exclusively available via the platform and its Caper Cart technology. The platform’s in-house ad program is also growing with new display advertising formats including Recipes, Occasions, and Bundles, allowing companies including Mondelēz, The J.M. Smucker Co. and Hormel Foods to integrate ads for specific products into these display formats.

What Simo said: “Our over 6,000 active brand partners, big and small, continue to value our leading performance, measurement, data, and product innovation. In particular, CPGs are eager to find new digital merchandising solutions that simply can’t exist in physical stores… We’re also applying our leading advertising capabilities to over a hundred retailers’ owned and operated sites, and with Carrot Ads, we’re allowing our partners to participate in retail media with minimal startup costs.” 

Diversification beyond third-party grocery delivery and into new areas of retail and restaurants (via UberEats) as well as offering tech solutions to retailers and suppliers appears to have been key in making Instacart’s business continue. But not all have been able to adapt and pivot with such success...

After a rough couple years online grocery platform Good Eggs announced this week it has been acquired by wholesale grocery supplier GrubMarket.

🛒 Like many in the grocery delivery space, the company saw demand spike during COVID-19 and then fall hard and fast in the following years. Launched in 2011, Good Eggs raised a total of $201 million, according to Crunchbase. But as demand slowed, it was forced to explore other options.

🚚 San Francisco-based GrubMarket was founded in 2014 and began with a similar goal of delivering fresh produce but eventually pivoted into the B2B supplier space. It has been expanding its network via acquisitions of regional produce wholesalers and AI-powered software companies as it scales into a major player as a grocery supplier to supermarket chains.

Nosh Insiders can read the full story to understand how the acquisition of Good Eggs feeds the competitive online grocery landscape as digital platforms jockey for new business.

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B&G Foods’ Q2 earnings, posted today, were largely in line with expectations, reflecting gradual improvement from the prior quarter, according to president and CEO Casey Keller.

• Net sales declined 5.3% to $444.6 million, primarily driven by the divestiture of the Green Giant canned food business, as well as a decrease in unit volume, a decrease in net pricing and the impact of product mix.
• Net income plummeted 63% to $3.9 million. Adjusted net income was down 39% to $6.6 million, and adjusted EBITDA decreased 6.6% year-over-year to $63.9 million. 
• The company has revised its full-year net sales guidance to a range of $1.945 billion to $1.970 billion (down from a previously stated range of $1.955 billion to $1.985 billion) and full-year adjusted EBITDA guidance to a range of $300 million to $315 million (from the prior forecast of $300 million to $320 million).

🗣️ “B&G Foods remains committed to execute against our long-term strategy to improve organic growth and focus the portfolio, despite short-term weakness in consumer packaged food demand,” Keller said in a statement.

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Nespresso USA unveiled a new range of honey products today, known as Nespresso Bloom, that are derived from the same flowers as the coffee in the brand’s Master Origins Colombia capsule.

👀 The products include Coffee Blossom Honey and Coffee Blossom Honey Syrup, which will both be available exclusively in Nespresso Boutiques in NYC and San Francisco starting today.

🤝 The new collection was developed in partnership with the Nestlé R+D Accelerator in Switzerland. The project focuses on understanding, measuring and supporting the transition to regenerative agriculture by implementing scientific tracking systems on Nespresso AAA farms.

💭 "Supporting responsible practices in coffee farming has always been part of Nespresso's DNA, and this pilot is a result of how sustainability is fueling our innovation strategy," said Alfonso Gonzalez Loeschen, CEO, Nespresso North America, in a statement.

Food supply chain data platform Terrantic has closed an oversubscribed $3.5 million seed round led by Supply Change Capital. The company will use the new funds to continue helping food processing companies increase shelf life, minimize food waste and improve yields via supply chain optimization. 

🤝 The round saw additional participation from York IE and Vitalize VC as well as existing investors Array Ventures. 

⏪ Terrantic was founded in 2022 and transforms existing data from multiple sources into actionable insights for the supply chain industry. Its Terrantic Ops Data Platform uses an AI-Driven Contextualization Engine to help food processors, growers and packhouses manage data.

💭 What they said: "An optimized and data-informed supply chain is critical to enabling a sustainable food system. Operational efficiency and data insights within the supply chain - from food processing to agriculture to process manufacturing - are the keys." - Noramay Cadena, managing partner of Supply Change Capital.