GrubHub pops as Amazon exits restaurant delivery in the US

  • Amazon is backing out of the restaurant-delivery space in the US after facing stiff competition from GrubHub, UberEats, and DoorDash.
  • In November, Amazon put an end to its UK restaurant-delivery program.
  • GrubHub’s shares are trading up more than 5% on the news.
  • Watch GrubHub trade live.

Chicago-based GrubHub is rallying early Tuesday, up 5.49%, after Amazon said it plans to shut down its restaurant-delivery service in the US by the end of the month. The program, which started in Seattle in 2015, was eventually offered in 20 cities across the country.

“As of June 24th, we will discontinue the Amazon Restaurants business in the US,” an Amazon spokesperson said in a statement shared with GeekWire. “Many of the small number of employees affected by this decision have already found new roles at Amazon, and others will be provided personalised support to find a new role within, or outside of, the company.”

The US’s restaurant-delivery business has become a crowded space, with competitors like UberEats, DoorDash, and GrubHub all making their presence known. According to Uber’s recent IPO filing, UberEats, it’s restaurant-delivery platform, generated $US1.5 billion in revenue last year, a 149% jump from 2017.

Tuesday’s announcement comes seven months after Amazon discontinued its delivery service in the UK. But, the e-commerce giant continues to have a foothold in the space after last month investing $US575 million in Deliveroo, a UK-based restaurant-delivery platform.

GrubHub is down 15.8% this year.

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