Shares of Blue Apron Holdings (NYSE:APRN) were soaring today after the meal-kit provider said its meals were now available on Jet.com, a subsidiary of Walmart (NYSE:WMT). As a result, shares of the struggling meal-kit service were up 19.2% as of 11:02 a.m. EDT.
With the deal, Jet becomes the first online retailer to carry Blue Apron products and has begun selling them in the New York City area as of today. The move follows a similar announcement a few weeks ago that Blue Apron would partner with Grubhub (NYSE:GRUB) to sell meals through the delivery service, also in New York, as meal-kit companies continue to look for new platforms to grow sales.
Blue Apron CEO Brad Dickerson explained the move, saying, "Teaming up with Jet enables us to dynamically serve the lifestyle of metropolitan consumers, who will now be able to conveniently fill up their online shopping carts with high quality Blue Apron meals that can be cooked in 30 minutes or less while shopping for other everyday needs."
Jet customers in the New York area will be able to order Blue Apron meals for same-day or next-day delivery, adding another level of convenience for Blue Apron customers who may want a last-minute option to order one of its meal kits.
Blue Apron's partnership itself isn't likely to move the needle for the meal-kit provider, as it only serves a small portion of the national population. The program is part of Jet's new "city grocery experience," which is currently only available for New York–area residents.
The real reason the stock is surging on the news is because investors are likely hopeful that the partnership with Jet could lead to Blue Apron's selling through Walmart, the leading grocery retailer in the U.S. Blue Apron has already broken into Costco stores in a pilot program, so selling in Walmart stores seems like a reasonable possibility, especially if things go well with Jet.
We may learn more in a couple weeks when Blue Apron reports third-quarter earnings on Nov. 14. Stay tuned, as Blue Apron shares should continue to be volatile.