Instacart (CART) stock debuted on Tuesday, when it opened at $42 per share on the Nasdaq.
The app, which offers grocery deliveries, had set the price of its IPO at $30 per share, which valued the company at roughly $10 billion.
The IPO of Instacart comes on the heels of Arm’s (ARM) return to the market just under a week ago. Following an initial surge of 20% due to investor enthusiasm during the first trading session following the chip designer’s IPO, the shares have fallen over 8% since IPO day.
Following the strong listing of Arm, Instacart raised its pricing range into the IPO, triggering a discussion over whether this public offering could pour some gas on a market which has been mostly smoldering over the past year. 1,010 IPO deals were made in 2021 according to data from Dealogic. That number plummeted to 173 in 2022.
Analysts said the reception of Instacart would serve as a better measure of an IPO market comeback, since its business is so radically different from Arm. Arm was the biggest IPO of 2023, with a valuation of $54.5 billion. The well established chip designer, which traded on the public markets previously, makes the chips which power 99 percent of premium smartphones.
On the other hand, Instacart will be trading publicly for the first time. Once valued at $39 billion, Instacart has reengineered its business to focus itself around advertising revenue, instead of just direct to customer sales.
In the first half of 2023, Instacart reported $1.48 billion in revenue, an increase of 31% from the same period in the previous year. 28% of that revenue was accounted for by advertising.
