DoorDash: Strong Growth, Big Deals
Here's our initial take on DoorDash's (NASDAQ: DASH) financial report.
Key Metrics
| Metric | Q1 2024 | Q1 2025 | Change | vs. Expectations |
|---|---|---|---|---|
| Revenue | $2.51 billion | $3.03 billion | 21% | Missed |
| Earnings per share | ($0.06) | $0.44 | n/a | Beat |
| Total orders | 620 million | 732 million | 18% | n/a |
| Gross order value | $19.2 billion | $23.1 billion | 20% | n/a |
DoorDash Posts Steady Growth, Plots Further Expansion
The story for DoorDash in recent quarters has been the company's success in translating the benefits of scale into profits. The tech platform is an undisputed leader in connecting consumers to local businesses, a field in which it is helpful to spread as much revenue as possible over your fixed costs for having delivery people on the ready.
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DoorDash grew the top line by 20% in the quarter and swung from a quarterly loss a year ago into a profit, surpassing Wall Street expectations for earnings and slightly missing on revenue. Total orders grew by 18% to 732 million, and marketplace gross order value was up 20% to $23.1 million.
Net cash from operating activities grew to $635 million, up 15% year over year, helping to boost total cash and equivalents by nearly $500 million.
DoorDash is not done adding scale. The company announced a deal to acquire European food delivery giant Deliveroo for 2.9 billion British pounds ($3.9 billion) and a separate deal to buy New York-based hospitality tech company Seven Rooms for $1.2 billion in cash.
Immediate Market Reaction
The quarter was strong, but investors appear to be slightly taken aback by the flurry of activity. DoorDash shares were down about 6% at the start of trading Tuesday.
What to Watch
DoorDash forecasted second-quarter adjusted EBITDA of $600 million to $650 million, which, at the midpoint, suggests some weakness compared to Wall Street's $639 million consensus estimate. The company continues to expect adjusted EBITDA as a percentage of marketplace gross order volumes to increase as the year goes on.
There are risks associated with acquisitions, especially in an uncertain macro climate. Investors will want to watch closely how the year develops. But the long-term investment thesis that DoorDash is able to use its size and scale to drive profits is intact, and the company's newly announced deals once integrated should help DoorDash expand on its powerful position and book further gains in the years to come.
Helpful Resources
- Full earnings report
- Investor relations page
- Additional coverage
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Lou Whiteman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends DoorDash. The Motley Fool has a disclosure policy.
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