Key Takeaways

DoorDash ( DASH ) shares surged Wednesday after the delivery platform announced a new partnership with Domino's Pizza ( DPZ ).

DoorDash users will be able to order Domino's throughout the U.S. starting in May, with a rollout in Canada expected later this year, the companies said. Since July 2023, Domino's has had an exclusive partnership with Uber ( UBER ) Eats, a deal that ends May 1.

DoorDash Connects With More 'Suburban and Rural' Customers, Domino's COO Says

"The ability to connect seamlessly with DoorDash customers means more sales for Domino's stores, while efficiently leveraging our brand's robust delivery network," Domino's COO Joe Jordan said. "Tapping into incremental customers, particularly in suburban and rural markets, is a meaningful opportunity for Domino's, as our brand continues to open stores nationwide."

In the pizza giant's last earnings call in February, CEO Russell Weiner said that Uber accounted for 3% of its $19.12 billion in sales for 2024, according to an AlphaSense transcript. Jordan on Wednesday repeated Domino's previously stated belief that third-party "aggregator" services like DoorDash could eventually make up $1 billion in annual sales.

DoorDash stock was among the biggest gainers in the S&P 500 Wednesday afternoon, with shares up more than 5%, while Domino's shares were about 1% higher.

Read the original article on Investopedia