On Tuesday, GRUB stock slumped to a new low after GrubHub Inc (NYSE:GRUB) reported uninspiring sales and expectations. The online food delivery company cited competition and changing customer preferences as the reason for the disappointing results.

GrubHub Slashes Guidance

The company reported a profit of $1 million or $0.01 per share on revenue of around $322.1 million relative to $247.2 million reported in Q3 2018. The company reported earnings per share of $0.27, down from $0.45 per share last year. Analysts had predicted that the company could post adjusted earnings of $0.27 per share on sales of $330 million.

For the holiday quarter, the company is expecting little or no significant growth and has predicted revenue to range between $315 million and $335 million. On average, analysts had projected sales for the fourth quarter to be around $387 million.

In a letter to stockholders, CEO Matt Maloney and CFO Adam DeWitt indicated that annual growth had decelerated. The company has also indicated that delivery innovations in the online space were equally weighing down sales. Also, the promotional delivery from large chains such as McDonald’s (NYSE:MCD), Taco Bell, and Yum Brands’ KFC was also impacting GrubHub’s expectations.

At the time of writing, GRUB stock is down 38.55% at $35.88 and made a new 52-week low of $35.04 earlier in the session.

Growing Competition in Online Food Delivery Space

The company pointed out that previous easy wins in the market are fading faster than anticipated. Although the online takeaway sector is becoming a longer-term state, its slow growth means it will settle on the lower side of the double-digit range. The company indicated that the 10% increase in its daily active customers was on the lower end of the company’s expectations.

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GrubHub faces growing competition from food delivery business DooorDash, Postmates, and Uber’s (NYSE:UBER) Uber Eats, which have all invested heavily in the expansion of their operations. GrubHub is feeling the effects of a competitively crowded market.

The company indicates that with a growing number of online ordering platforms, customers are increasingly ordering from a different platform. GrubHub is no longer enjoying the customer loyalty it has previously been enjoying.

GRUB stock has tumbled over 50% so far in 2019.

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