Feb 25 (Reuters) - Instacart CART.O forecast first-quarter gross transaction value (GTV) above Wall Street estimates on Tuesday, betting on efforts to add low-and-no-cost delivery options to drive spending on its online grocery delivery platform.
Consumers have been increasingly opting to shop online for products ranging from grocery to home furnishing items on their mobile devices helping delivery firms including Instacart.
The company, formally known as Maplebear, got a boost during the all-important holiday quarter as it introduced low-to-no cost deliveries on some items.
The San Francisco-based company forecast first-quarter GTV, a key metric that shows value of products sold based on prices shown on Instacart, to grow up to 10% to $9.15 billion, compared with analysts' estimates of 7.6% growth to $8.95 billion, according to data compiled by LSEG.
Instacart's fourth-quarter GTV rose 10% to $8.65 billion, beating estimates of a 9% increase to $8.60 billion.
Its advertising revenue rose 10% in the quarter ended December 31, compared with 7% a year earlier.
However, Instacart forecast first-quarter core profit between $220 million and $230 million, compared with analysts' estimates of $238 million.
Rival DoorDash DASH.O also forecast quarterly adjusted core profit below estimates earlier this month due to an increase in advertising expenses during the holiday season.
(Reporting by Anuja Bharat Mistry in Bengaluru; Editing by Shounak Dasgupta)
((AnujaBharat.Mistry@thomsonreuters.com))
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