DoorDash Inc Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Shweta Khajuria - Wolfe Research - Analyst : Let me try two, please. On just international competitive landscape, could you please talk about now with DoorDash World and Deliveroo, what the combined share is as it stands in your 40 markets? And then how fast is the European market growing from your vantage point? And is it fair to assume Deliveroo's unit economics and retention rates are as attractive? I remember when you acquired Wolt, one of the reasons was the unit economics and retention rates as you saw them. So could you please comment for Deliveroo as well? And then my second question is on the tariff impact. If prices were to increase through the year, you touched on it in your release. How are you positioning yourself for the rest of the year in terms of what you could do as it relates to pricing, but whether it's price parity, loyalty integrations, discounts. Anything that you can talk about, that'd be great. Thanks a lot.

Question: Shweta Khajuria - Wolfe Research - Analyst : Thanks, Tony.

Question: Deepak Mathivanan - Cantor Fitzgerald - Analyst : Tony, historically, you've been somewhat hesitant to make bigger acquisitions. You've done two this quarter. Has the philosophy on how you generally think about M&As now changed at all? What are maybe some of the other areas you think M&As could help improve DoorDash? And then one for Ravi. On groceries specifically, can you discuss on the factors that's accelerating the spend per customer? Are you seeing the use case broaden out into larger baskets, maybe from weekly runs or monthly refills? Anything you're specifically doing to drive this behavior? Thank you so much.

Question: Deepak Mathivanan - Cantor Fitzgerald - Analyst : Great. Thanks, Tony. Thanks, Ravi.

Question: Nikhil Devnani - Bernstein Institutional Services LLC - Analyst : I wanted to ask on EBITDA in light of the M&A announcements. I know it's quite early to be talking about 2026, but I guess in recent quarters there's been pretty consistent GOP growth, pretty consistent EBITDA improvement. In your mind, when you think about the acquisitions of Deliveroo and SevenRooms, does this change any of that in terms of the earnings algorithm? I think they could open the door to further investment in new markets or new products, which is a good thing long-term. But when you think about the quantum of investment required and you anticipate spending to accelerate these businesses, I mean, does it materially change your perspective on how earnings, the earnings power for DoorDash in 2025 and 2026? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 12:00PM, DASH.OQ - Q1 2025 DoorDash Inc Earnings Call

Question: Nikhil Devnani - Bernstein Institutional Services LLC - Analyst : Thanks Ravi.

Question: Youssef Squali - Truist Securities - Analyst : So can you expand a little bit more on the affordability initiative and makeshift that caused net revenue margins to be down quarter-on-quarter, and what will drive it back higher? I think in the release you talked about the guidance for Q2 for it to flip back higher year-on-year and

Question: Youssef Squali - Truist Securities - Analyst : Great. Thank you both and good luck.

Question: Michael Morton - MoffettNathanson LLC - Analyst : Can we follow up, Ravi, on the net revenue margin commentary, and I would assume a lot of the affordability is coming in groceries. And I would love to know what type of behavior you're looking to drive in that, is that to bring new grocery orders or new users, or is it to increase frequency? And then is there any, like under the hood, is there any changes in competitive intensity you're seeing in the grocery market that are that maybe driving some of the affordability push? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 12:00PM, DASH.OQ - Q1 2025 DoorDash Inc Earnings Call And then one for Tony, to the extent you can talk about European food delivery due to the limitations of the Deliveroo, seems like it's consolidating. Wondering over the next several years, do you see any step changes in competitive intensity in those markets and how you maybe see the concentration playing out? Thanks, guys.

Question: Michael Morton - MoffettNathanson LLC - Analyst : Thanks so much, guys.

Question: Andrew Boone - Citizens JMP Securities, LLC - Analyst : I wanted to go back to take rate and pair it with sales and marketing. Take rates step down, implying more promotions, and sales and marketing also showed less leverage in 1Q. Can we just step back and talk about the efficiency in which you guys are driving demand? Was there incremental pressure there? Is there anything else you guys are seeing? And then, Tony, in the press release you talked about DashPass evolving and adding more value. Can you just speak to your vision for DashPass and how you see that evolving over the next couple of years? Thanks so much.

Question: Andrew Boone - Citizens JMP Securities, LLC - Analyst : Thank you.

Question: Ken Gawrelski - Wells Fargo Securities, LLC - Analyst : If I could come back to the questions around Deliveroo and Europe, and I know you can always speak to these at a high level, but could you just talk a little bit more about entering into some of these markets in a number two or three position? I understand that increasing the addressable market for you in Europe, but a UK consumer is different than a Norwegian consumer, and they don't care about the restaurant supply in Norway. So help us understand the approach to these markets. Not being in a leadership position currently, how you're thinking about that and maybe even the investment profile of those markets relative to the growth today? It maybe -- we'll just -- we'll hold it there.

Question: Ken Gawrelski - Wells Fargo Securities, LLC - Analyst : Okay. Thank you very much.

Question: Doug Anmuth - JPMorgan - Analyst : Really good progress in grocery, and you talked about a quarter of users purchasing across restaurants and grocery. What do you think is required to exceed the in-store experience going forward? What kinds of innovations and improvements? Thanks.

Question: Doug Anmuth - JPMorgan - Analyst : Thank you both.

Question: Mark Mahaney - Evercore ISI - Analyst : Let me ask you a question on cash levels and then on the SevenRooms acquisition. So just talk about what you think is a minimum level of cash you want to run the business with going forward. You're obviously putting out, I don't know, $4 billion and something in cash for these two acquisitions, given where you are now. So just talk about your -- what are the right comfort levels in terms of the cash balance that you need or want to carry. And then on the SevenRooms acquisition, it's not a huge pivot, but it is a pivot or it's an expansion of your offerings so just talk about how much more I think it's marketing as a service. I think you mentioned in there. You could do that with a lot of customers beyond just restaurants. So how far do you think you can extend SevenRooms or that idea to the rest of your customer base? I guess, how much of a push do you want to make behind offering marketing as a service? Thank you.

Question: Ronald Josey - Citi - Analyst : Maybe just another question on DashPass here ,Tony, I know you've gotten a few. But in the letter you talked about expanding the value prop of DashPass in 1Q and more things to come. So I just wanted to maybe get more insights on how the value prop continues to grow and how that's driving, just accelerating growth on DashPass. And then just more tactically speaking, I think we saw in New York recently the city council raised delivery cap fees and wondering, I know we've talked about New York and the impact quite a bit since the pandemic. But would love your thoughts on that, particularly with the SevenRooms acquisition. Thank you.

Question: Ronald Josey - Citi - Analyst : Okay, thank you.

Question: Mark Zgutowicz - The Benchmark Company - Analyst : I was just hoping we could take a step back and if you could maybe discuss how your affordability initiatives are being directed to restaurant versus grocery and domestic versus international? And how your promo activity in 1Q compared to last quarter and year-over-year? Thanks.

Question: John Colantuoni - Jefferies LLC - Analyst : Just wanted to ask about average order value picked up nicely in the quarter, maybe talk about the drivers of that improvement from US restaurant, international restaurant, and grocery and convenience. And specifically curious how basket sizes have shifted across those three businesses in the quarter. And the second, just a quick one on GOB guidance, can you just give us a little a sense for how much FX is contributing to your outlook there? Thanks.

Question: John Colantuoni - Jefferies LLC - Analyst : Okay. Great. Thank you.

Question: Michael McGovern - BofA Global Research - Analyst : I have two. You mentioned autonomy in terms of your uptick in CapEx this quarter, and I think you had some interesting announcements in your quarter about your first delivery robots in LA and also drone testing. Can you just provide an update on your efforts there and autonomy and how you view the long-term opportunity? And then secondly, a question on regulatory. Recently there was a bill proposed in the Senate about independent workers getting access to portable benefits at the federal level. I think you provided portable benefits in some states. Is that driven a big impact in those states and just how do you view the possibility of that expanding more broadly?

Question: Michael McGovern - BofA Global Research - Analyst : Great. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 06, 2025 / 12:00PM, DASH.OQ - Q1 2025 DoorDash Inc Earnings Call

Question: Jim Sanderson - Northcoast Research - Analyst : You mentioned earlier in the call that the first quarter for DoorDash is a very strong growth quarter. So I'm wondering in this context, are there any sectors, geographies, or demographic groups within the DoorDash US restaurant business that grew ahead of your expectations or lagged significantly below your expectations?