DoorDash’s first quarter saw a negative market reaction, reflecting disappointment with revenue coming in below Wall Street expectations despite robust year-over-year growth. Management pointed to broad-based order volume gains, particularly in new verticals like grocery, and highlighted continued investment in affordability initiatives as key factors influencing the quarter. CEO Tony Xu emphasized, “Food really is the most resilient category,” noting that investments in product quality and affordability helped drive usage. However, these choices contributed to a lower net revenue margin and less leverage in sales and marketing, factors that weighed on overall results.
Is now the time to buy DASH? Find out in our full research report (it’s free).
DoorDash (DASH) Q1 CY2025 Highlights:
- Revenue: $3.03 billion vs analyst estimates of $3.10 billion (20.7% year-on-year growth, 2.1% miss)
- Adjusted EPS: $1.07 vs analyst estimates of $0.97 (11% beat)
- Adjusted EBITDA: $590 million vs analyst estimates of $588.6 million (19.5% margin, in line)
- EBITDA guidance for Q2 CY2025 is $625 million at the midpoint, below analyst estimates of $636.1 million
- Operating Margin: 5.1%, up from -2.4% in the same quarter last year
- Orders: 732 million, up 112 million year on year
- Market Capitalization: $101 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions DoorDash’s Q1 Earnings Call
- Shweta Khajuria (Wolfe Research) asked about DoorDash’s combined market share post-Deliveroo and potential plans to offset tariffs. CEO Tony Xu described the deal as adding scale and noted food as a resilient category, with no tariff impact seen so far.
- Deepak Mathivanan (Cantor Fitzgerald) questioned if DoorDash’s M&A philosophy had shifted. Xu reiterated that the bar for acquisitions remains high and deals are only pursued if they expand the addressable market and align with existing operational strengths.
- Youssef Squali (Truist Securities) sought clarity on net revenue margin decline and the path to improvement. Inukonda explained the margin dip was temporary, driven by seasonality and targeted investments, and expects margins to recover as the year progresses.
- Michael Morton (MoffettNathanson) inquired about the impact of affordability initiatives on grocery and competitive intensity. Inukonda highlighted DashPass’s growth and stable competitive dynamics, with share gains in grocery.
- Doug Anmuth (JPMorgan) asked about innovations needed to surpass the in-store grocery experience. Xu emphasized ongoing efforts in accuracy, affordability, and customer support, citing DoubleDash as an example of digital convenience exceeding physical shopping in some cases.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be watching (1) progress on integrating Deliveroo and scaling DoorDash’s European operations, (2) the impact of ongoing affordability initiatives and DashPass enhancements on order frequency and retention, and (3) margin recovery as investments in technology and new verticals begin to yield efficiency gains. Further developments in autonomous delivery and regulatory outcomes in major cities will also be important markers.
DoorDash currently trades at $238.13, up from $205.47 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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