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GrubHub beats profit estimates as acquisitions provide boost

(Reuters) - GrubHub Inc’s (GRUB.N) profit and revenue topped analysts’ estimates in the third quarter, as the online food delivery company benefited from buying rivals that gave it more customers and increased its restaurant base.

GrubHub said it expects revenue of $197 million to $205 million for the quarter ending December, higher than analysts’ estimate of $183.8 million.

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Shares of the company were up nearly 5 percent before the bell.

GrubHub said on Wednesday it had 9.81 million active diners in the quarter ended Sept. 30, up nearly 28 percent from a year earlier and topping analysts’ average estimate of 9.57 million diners, according to research firm FactSet.

Chicago-based GrubHub defines active diners as the number of unique customer accounts from which an order has been placed in the past twelve months.

The company earlier this year bought Yelp Inc’s (YELP.N) online food delivery platform Eat24, adding to a list of acquisitions that include Foodler Inc and OrderUp.

The company’s acquisition spree comes as GrubHub faces stiff competition from bigger entrants to online food delivery such as Amazon.com (AMZN.O), Uber [UBER.UL], and more recently, Facebook Inc (FB.O).

GrubHub said third-quarter net income attributable to common stockholders slipped to $13 million or 15 cents per share, from $13.2 million or 15 cents per share, a year earlier.

Excluding one-time items, the company earned 28 cents per share, beating analysts’ average estimate of 24 cents, according to Thomson Reuters I/B/E/S.

Revenue rose 32 percent to $163.1 million, edging past analysts’ expectations of $159.7 million.


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