The online provider of grocery-delivery services Instacart filed papers Friday for an initial public offering. That filing showed a surprisingly decent bottom line—and not one pulled in the nick of time ahead of the listing. Maplebear, which does business as Instacart, first generated an operating profit based on generally accepted accounting principles in the fourth quarter of 2020. It has also shown a profit under those standards for the last five consecutive quarters, leading to an operating margin of 14% for the trailing 12-month period ended in June.
That stands out especially against other so-called gig-economy players. Uber, Lyft and DoorDash are still all losing money annually on that basis, though Uber did just manage its first quarter of GAAP operating profits in the June period. Advertising has likely been a major factor helping Instacart’s bottom line, as national brands pay for prime placement in the company’s virtual grocery aisles.
One of those national brands—PepsiCo—is even buying $175 million of Instacart’s shares in a private placement deal ahead of the offering. Advertising now accounts for more than a quarter of Instacart’s annual revenue.