Category: independent research on IPOs
Mobileye Global (NASDAQ: MBLY)
Mobileye Global (NASDAQ: MBLY), a provider of advanced driver assistance systems (ADAS) and autonomous driving technologies, is a recent addition to our Battle Road IPO Review. Founded in 1999 by Amnon Shashua, a Hebrew University professor and researcher, the company first deployed its solutions on vehicles in 2007. Today, Mobileye is headquartered in Jerusalem, Israel, where it is still led by Shashua, who acts as the company’s CEO, President, and Director.
Mobileye first debuted on the New York Stock Exchange on August 1st, 2014. The company continued trading on the exchange until March 2017, when it was purchased by Intel for $15.3 billion. At the time, Mobileye’s market cap was roughly $10.5 billion. Intel’s thinking at the time, was that Mobileye’s ADAS offerings, essentially software embedded on a computer chip, would complement Intel’s core chip offerings. Perhaps realizing the lack of synergy with its core business, Intel elected to carve out the business, while retaining voting rights. Thus, Mobileye returned to trading desks on October 26th, 2022 as a spinoff of Intel. This late-October IPO entailed the sale of 47.2 million Class A common stock shares, inclusive of the underwriters’ 30-day option to purchase up to an additional 6.2 million shares, with all shares coming from the company. Mobileye also sold 4.8 million Class A common stock shares to General Atlantic in a private placement for gross proceeds of $100 million. In total, with a 2022 IPO share price of $21, Mobileye generated net cash of roughly $1 billion from the IPO and private placement. When added to the company’s pre-IPO cash balance of $774 million, Mobileye possessed $1.8 billion in cash with no debt immediately after the offering.
Mobileye is a pioneer in the production of advanced driver assistance systems (ADAS) and autonomous driving technologies and solutions. Mobileye’s offerings are based on its expansive purpose-built software and hardware technologies that are made to supply the necessary functions to enhance ADAS and autonomous driving. Further, these technologies can already be leveraged in vehicles to provide mission-critical activities that make roads and vehicles safer, and can be delivered at the edge or in the cloud.
Mobileye projects that the current total addressable market for its ADAS solutions is $16 billion, and the company predicts that its total addressable market will rise to $480 billion by the end of 2030, inclusive of the ADAS segment as well as the autonomous vehicle market. Mobileye has carved out a solid share of this current market, as the company generated 2020 revenue of $967 million with a net loss of $196 million. In 2021, Mobileye’s revenue jumped 43 percent to $1.4 billion, and the company’s net loss shrunk to $75 million. Mobileye notes that essentially all of its revenue currently comes from its commercially deployed ADAS products.
DoorDash: Getting Dinner on the Table
DoorDash (NYSE: DASH), a food delivery platform and service, was founded in 2013. Today, DoorDash is headquartered in San Francisco, California, where it is led by Tony Xu, who acts as the company’s CEO and Director. Consensus analyst estimates call for DoorDash to produce revenues of $2.9 billion in fiscal 2020, along with a loss per share of $1.08. In fiscal 2021, analysts foresee an improvement, with revenue estimates rising to $3.7 billion and EPS estimates at $0.15.
DoorDash debuted on the New York Stock Exchange on December 9th, 2020, in a 33 million Class A common stock offering, priced at $102. With all shares coming from the company, DoorDash generated close to $3.4 billion from the offering. With a pre-IPO cash balance of $1.6 billion and no debt, DoorDash possessed roughly $5 billion in cash with no debt immediately after the offering. At a recent share price of $180, DoorDash carries a market cap of approximately $57 billion.
DoorDash’s mission is to grow and empower local economies. DoorDash was founded as a merchant-first business, as the platform allows brick-and-mortar companies to thrive in an ever-growing convenience-oriented economy with changing consumer demands. This is achieved through the DoorDash Marketplace, which provides a variety of services, allowing merchants to acquire customers, deliver orders, gain access to insights and analytics, merchandise, process payments, and manage customer support.
The company’s proprietary technology enables it to optimize interactions between merchants, consumers, and delivery drivers, or Dashers, to create a seamless end-to-end experience. Every order on the Marketplace platform is analyzed by DoorDash’s machine learning algorithms to continuously improve the quality and performance of the platform. This allows the company to present personalized content to consumers by accounting for past order preferences, provides data for Dashers to maximize their earnings opportunities, and optimizes the experiences of all users on the Marketplace through increasingly intelligent and efficient logistics.
DoorDash assists merchants by catalyzing incremental sales and leveraging their fixed cost investments while establishing an online presence and broadening their reach. With DoorDash, merchants have the option of fulfilling orders through delivery, facilitated by the platform, or in-person pickup by customers. Additionally, merchants can launch promotions on the Marketplace. Merchants have produced over $19 billion in combined total sales on the Marketplace, and in 2019, experienced a 59 percent year-over-year same store sales increase on the platform. Dashers have garnered more than $7 billion combined through the Marketplace.
In addition to individual, one-off orders, DoorDash offers a membership program called DashPass where customers pay a $9.99 monthly delivery fee for unlimited deliveries from eligible merchants. While currently only available for restaurants, the company anticipates providing customers access to all of their local businesses in the future, allowing consumers to receive benefits while shopping in-store, at-home, or anywhere else.
DoorDash’s Marketplace platform has connected more than 390,000 merchants, over 18 million consumers, and more than one million Dashers throughout the United States, Canada, and Australia. In total, more than 900 million orders have been processed and completed through the platform. DoorDash has partnerships with more than 175 of the 200 largest national restaurant brands, such as McDonald’s, Chick-Fil-A, The Cheesecake Factory, Chipotle, Wingstop, and Wendy’s.
DoorDash is the largest and fastest growing local food delivery logistics firm in the United States, boasting a 50 percent United States category share and a 58 percent category share in suburban markets. Off premises consumption of restaurant meals (i.e., takeout or delivery orders from restaurants) totaled nearly $303 billion in the United States in 2019. Despite this, DoorDash generated a mere $8 billion in total orders in 2019, representing less than three percent of the total market opportunity in America.