The above graph represents the Grubhub costs and expenses by year, starting from fiscal 2011 to the recently completed year. Grubhub’s total operating expenses increased 43% YoY in 2019 to an all-time high of $1,318.4 million. Approximately three-fourth of that was spent on operations & support and sales & marketing activities. Grubhub operations and support expenses amounted to $675.47 million in 2019, representing 48.7% YoY increase. The growth was primarily driven by the increase in Gross Food Sales, as well as the increase in payment processing costs for diner orders, customer care and operations personnel costs.
Grubhub Annual Operating Expenses: In-Depth
|Source||Grubhub Annual Reports, SEC Filings|
|Note||Grubhub fiscal year starts from January 1st|
Grubhub sales and marketing expenses also increased an impressive 44.8% YoY in 2019, to an all-time high of $310.3 million. That’s representing approximately 23.5% of Grubhub’s total revenue in 2019. The increase in sales and marketing spending was primarily due to the increase in advertising campaigns across various media channels, as well as the significant increase in salaries, commissions, and stock-based compensation expense.
Grubhub technology expenses crossed $100 million mark for the first time in 2019. The total expenses in technology department increased to $115.3 million in 2019, from $56.26 million in 2017.
Similarly, Grubhub general and administrative expenses also increased to $101.9 million during the 12-months ended December 31, 2019. That’s a strong 19.3% YoY growth. The company’s general and administrative expenses consist of salaries, benefits, stock-based compensation expense and bonuses for executive, finance, accounting, legal, human resources and administrative support.
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