By Akanksha Khushi

(Reuters) –Instacart Inc has slashed its value by almost 40% to $24 billion on Thursday due to market turbulence. This underscores the challenges U.S. grocery delivery companies are experiencing as they face increased competition.

Instacart’s valuation grew by $39 billion in six months, as the Coronavirus pandemic was rampant and delivery via doorsteps was on its rise. Rival Gopuff saw a 69% increase in its valuation, to $15 billion by July.

The fortunes of Instacart are now in reverse, as Walmart (NYSE) Inc increased grocery deliveries, and DoorDash Inc increased its drive for a greater share of the delivery market.

DoorDash’s market value has been affected by the increased competition. Uber Technologies Inc N: amid the wider decline of technology stocks over recent months.

The stock market plunged 23% in DoorDash. DoorDash has experienced rapid expansion and recently bought Wolt, a European competitor for $8 billion.

Uber’s losses have been nearly 17% as Buyk, a smaller rival filed for bankruptcy protection. Fridge No More also shut down operations.

Instacart spokeswoman said that they are not immune from market volatility which has adversely affected top technology companies, both private and public.

According to the company, the revised valuation will help attract and keep talent in tight U.S. labor markets by aligning equity awards.

Reuters published last year that Instacart considered going public via a direct list. They were concerned it might lose money in a traditional initial public offer.

Bloomberg News reported first on the decision to lower valuation.