The COVID-19 pandemic is ongoing, even though widespread vaccinations and new treatments have allowed society to (mostly) return to normal. While that's great news, a number of companies emerged as big beneficiaries of pandemic-related restrictions, and it's becoming apparent their sky-high growth rates from 2020 and 2021 might be in the rearview mirror for good.

The stock market is currently in the middle of a busy earnings season for the quarter that ended June 30, and it's revealed a further deceleration in growth for DoorDash (DASH -0.88%) and Twitter (TWTR), two of the strongest plays when the pandemic was at its worst.

The question is: Can these companies reclaim the soaring sales growth of the last two years?

DoorDash: Slower sales and steeper losses

When society was in lockdown mode, food delivery giant DoorDash was one of the only ways consumers could enjoy their favorite restaurants. The company has a market share of 59% in the U.S., far ahead of Uber Eats, in second place with 24%.

But despite its dominant position, DoorDash is still hurt by competition, because the technology facilitating its food delivery services isn't unique. It's relatively cheap and easy for new participants to enter the market, so established players like DoorDash must constantly compete on price and invest in marketing, making it much harder to run a profitable business.

In the second quarter of 2022 (reported Aug. 4), DoorDash lost $263 million, its steepest bottom-line hit since the fourth quarter of 2020. The math behind this is simple: DoorDash's costs grew 41% year over year, while revenue was up just 30% -- the slowest quarter of top-line growth since the company listed publicly.

A bar chart of DoorDash's quarterly revenue from Q4 2020 through Q2 2022.

Data source: DoorDash. YoY = year over year. Chart by author.

The trouble is that one of the expenses DoorDash is now trimming back is marketing, and that means the company could see fewer customer acquisitions -- and therefore less revenue. This could get worse if DoorDash's competitors spend more aggressively, and its market share begins to slip.

One positive to the DoorDash story is its diversification. In the second quarter, it completed an acquisition of Wolt, a last-mile delivery company based in Europe. Wolt accelerates DoorDash's expansion not only overseas but also into other delivery verticals.

Still, adding the up-and-coming technology platform to DoorDash's portfolio could contribute to further net losses. Time will tell whether the combined companies can become a profitable enterprise, or even reignite a growth acceleration. But until then, it might be wise for investors to steer clear.

Twitter: Revenue growth has ground to a halt

The more time people spend inside, the more time they spend in front of screens. That's one takeaway from the pandemic, which boosted the financial results of just about every social media company in the U.S., Twitter included. But what goes up must come down, and there's been a notable deceleration in both user growth and advertising revenue in 2022.

However, Twitter has one notable difference. Right now, it's embroiled in a very public court battle with Tesla CEO Elon Musk, who offered to buy the company for $54.20 per share in April before backing out of the deal. Musk has expressed concerns about the number of fake accounts on Twitter and says he isn't satisfied with the company's response to his queries.

Twitter is suing Musk in the hopes of forcing him to complete the deal, and if that's successful, there would be some upside for the stock since it trades at just $44 as of this writing. But if the deal fails to close, investors might refocus their attention on the company's rapidly slowing revenue growth, which could result in continued downward pressure on the share price.

A bar chart of Twitter's quarterly revenue from Q1 2021 through Q2 2022.

Data source: Twitter. YoY = year over year. Chart by author.

The U.S. Federal Reserve is currently on one of its most aggressive campaigns to hike interest rates in history in order to fight off inflation, which was recently at a 40-year high. That's putting pressure on the spending power of consumers. And it's also affecting the bottom line of corporate America, forcing companies to cut expenses on line items like marketing, as they anticipate a lower return on their investment for the foreseeable future.

Twitter generates over 90% of its revenue from advertising, so it will likely feel the pinch until inflation is under control and the economy picks up steam again. It's unlikely Twitter is going to see another pandemic-like environment anytime soon, so last year's strong growth rates may be a thing of the past.