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Investors gagging on Blue Apron shares

Behind Snap's stock slide
Behind Snap's stock slide 01:00

NEW YORK — Meal kit seller Blue Apron reported strong customer growth and an increase in orders in its first earnings report since becoming a public company. But its losses for the quarter mounted over the year-ago period, sending the stock plunging Thursday morning.

CEO Matt Salzberg also said on the earnings call that the company's planned new facility in Linden, New Jersey, would be delayed, affecting earnings in the second half of the year.

Shares of the company were down by 93 cents, or 15 percent, to $5.30 a share Thursday morning. 

Blue Apron Holdings Inc. (APRN) lost $31.6 million, or 47 cents per share, in the quarter. Wall Street forecast a loss of 27 cents per share. A year earlier the New York-based company earned $5.5 million, or breakeven per share. 

The company, which went public in June, reported a 23 percent increase in customers from the prior-year period. The average revenue per customer was $251. That's below the $264 of the year-ago period but better than the $236 of the first quarter. Orders climbed to 4,033 from 3,399.

Rise of meal kit services 03:26

Blue Apron ships boxes to customers filled with all the raw ingredients needed to make home-cooked meals. Its cheapest kit, which makes four servings, costs about $48.

Total revenue for the period ended June 30 rose to $238.1 million from $201.9 million. That's better than the $235.8 million that analysts surveyed by FactSet predicted.

But Blue Apron has many rivals, including HelloFresh and Plated, and there are concerns that competition to deliver groceries to people's doorsteps will only heat up after e-commerce giant Inc. announced plans to buy organic grocer Whole Foods. In some cities, Amazon already sells meal kits with recipes created by home goods mogul Martha Stewart.

The company, which was founded five years ago, has yet to make a profit. It reported a loss of $55 million last year, but its sales have soared. Blue Apron posted revenue of $795.4 million for 2016, more than double its level the year before.

Last month Blue Apron said that one of its co-founders, Matthew Wadiak was stepping down from his role as chief operating officer and would become a senior advisor to the company.

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