Amazon to shut down US restaurant delivery service


1 photo

This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.

NEW YORK (AP) — Amazon said Tuesday that it is closing its U.S. restaurant delivery service, a 4-year-old business that failed to take off amid fierce competition from Uber Eats, DoorDash and others.

The service, called Amazon Restaurants, offered delivery in more than 20 cities in the U.S. It expanded into the United Kingdom, but Amazon shut down the service in that country late last year. The closure of the U.S. business, which was first reported by technology news site GeekWire, will happen on June 24.

Still, Amazon.com Inc. has shown interest in delivering meals to diners' doorsteps. Last month, it bought a stake in British food delivery company Deliveroo, whose kangaroo logo is a common sight on bicycles and scooters in Britain.

Amazon Restaurants was a tiny player in the U.S., taking about 2% of the market, according to Jeremy Scott, a food and restaurant analyst at Mizuho.

He said Amazon didn't promote the delivery service enough and didn't have deals with big fast food chains. Uber Eats, for example, delivers Big Macs from McDonalds; DoorDash has a partnership with Wendy's; and Grubhub delivers Taco Bell chalupas and buckets of KFC's fried chicken.

With Amazon out of the business, analysts said others could pick up its business. Shares of Grubhub Inc. soared 7% Tuesday.

But Scott thinks Amazon isn't abandoning the business altogether.

"The shuttering of the platform doesn't necessarily mean that Amazon won't eventually invest in the space," he said.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Photos

Joseph Pisani

    SIGN UP FOR THE KSL.COM NEWSLETTER

    Catch up on the top news and features from KSL.com, sent weekly.
    By subscribing, you acknowledge and agree to KSL.com's Terms of Use and Privacy Policy.

    KSL Weather Forecast