DoorDash (DASH) 4 May 232023 Q1 Earnings call transcript

Company Profile

Participants

Andy Hargreaves	Vice President, Finance and Investor Relations
Tony Xu	Co-Founder, Chair and CEO
Ravi Inukonda	Chief Financial Officer
Ross Sandler	Barclays
Deepak Mathivanan	Wolfe Research
Bernie McTernan	Needham & Company
Michael McGovern	Bank of America
Michael Morton	MoffettNathanson
Ian Peterson	Evercore
Andrew Boone	JMP Securities
Brian Nowak	Morgan Stanley
Youssef Squali	Truist Securities
Ron Josey	Citi
Rohit Kulkarni	ROTH MKM
Eric Sheridan	Goldman Sachs
Lloyd Walmsley	UBS
John Colantuoni	Jefferies

Call transcript

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Operator

Hello. My name is Jean Louis. Welcome to the DoorDash Q1 2023 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. Instructions] [Operator

turn to now go Hargreaves. conference ahead. the will Andy over Please I

Andy Hargreaves

Good thanks am everyone. for Jean and Co-Founder, afternoon, Thanks, Louis. Tony CEO, And be today quarter Xu; earnings Chair and to Ravi our XXXX for call. pleased I Inukonda. very CFO, joined by first us joining

and business, consumer investment forward-looking performance, market, operating environment. making be call approach, will position, with during today’s the being strategies, financial our Dashers, our We statements expectations spending alignment merchants for and our guidance,

Forward-looking those and XX-Qs. actual and including statements described uncertainties that results to filings, subject to XX-Ks are risks of are could differ described. uncertainties SEC Form cause materially these our from in our Many

We as disclaim statements, obligation any not forward-looking by update required any on You statements should as events. rely to except forward-looking our law. predictions future of

letters our which we During discuss in should addition our of a most regarding results. be These measures for financial our a in website. be are considered our measures. non-GAAP may non-GAAP to financial non-GAAP directly on measures Information to certain reconciliation measures, substitute Investor is results to intended the including GAAP the this to measures and non-GAAP call, GAAP not comparable our will be shareholders, GAAP Relations available found

webcasted shortly the after Finally, replay this audio call be website our call ends. is website. on A IR will our on being of the available call

we first can Jean Louis, our and it I take you pass to will question. back

Operator

[Technical Please [Operator Instructions] comes Your go ahead. line question the Difficulty]. first from of

Ross Sandler

verticals looks questions. I I two new cohort all The data color. the guys. for for guess Thanks Hey, great. had

a of folks well, also and or in subsequent a the and GOV correct? purchase are is about purchasing things where January Thanks compared And we also maybe guys quarter that your convenience so talk guide? is, then ground for XQ effects? little quarter linearity that that pandemic and the saw, peers just are have frequency, of second Just put a and about lot. some in much trying as to in can shows the in because question the we many a GOV you talked with just point the how a And how to flag at reconcile getting grocery that convenience? users restaurant grocery what are these Is like clarification, exiting stronger

Tony Xu

the Hey, Ross, first with will question I let -- then will will Tony. I on it’s the Yeah. second I and Ravi chime start question. in

our your really and the categories. I first strength new question around was performance cohorts the the So in think of

question to new in cohorts, the the of with yes. mean, certainly answer lot this stronger -- mean do your is, retained I the product quality. improvements previous to I cohorts has are a than

we So U.S. in are -- adding selection top now players like serve the the we grocers of XX-plus ALDI, now

sure improving the of are making filling that itself, we the Number store. of also we two, the carts, the the inside the perfect are both experience are items quality when that more substitution accurate not the for shop we to experience the in ability

you whether convenience also with delivered minutes, more it you of whether in allowing later want doing And bit we greater the this want you are choices this in delivered day. by XX a

the those And seeing categories. why are that’s improve all in cohort so, performance new reasons, for you of

Ravi Inukonda

Ross. Hey,

and engagement second the to On be continues consumer the very question, strong. spending on platform

growth double-digit last row. QX years in for driven our strong that You two can results, rate consistently well have that in the we as see as the a

very frequency comment going but not am to -- continues be to good. continues I it the month-to-month, on order

input very prior good feel are about guidance the very quarter. continues QX. We confident an very it’s I all-time than the In metrics business, the in high. to quarter strong is higher for fact, be retention seeing past about feel we Retention this and the

Operator

you. Thank

ahead. from comes question go Research. from Please next Your Deepak Mathivanan Wolfe

Deepak Mathivanan

changes the have taking stages wanted operating you on for for like to sort ask see Were much. to metric but steps approach the you, your could model groceries in so profitability are talked of or you it but where thinking in there EBITDA, of like still maybe areas at outperformance Thanks the the any XXXX? do you as nailed question. you for early areas feel your well? to touch the maybe opportunity? in kind always then right. of about on verticals. currently Prabir Tony, XQ on sort I output nice for that this It’s efforts on scaling was talk what huge nice one And make. next investment down Maybe being the level All on this second about perhaps, about in are for investments investment of seeing has based strategically Thanks point, areas strategic Ravi, and returns

Tony Xu

around the I start performance Yeah. which the will and grocery with question, really mean, first you are was exactly right. I there.

that and performance you improvements of faster the in collectively numbers that’s things altogether, what’s top quarter. lines, I unit overseas a saw like so the including even of in in seeing seeing business bottomline, the business are happening really in growth grocery we well, think are as I you growth, both our and I the all think reflected in economics core and of continued as at of business, restaurants the mean, businesses certainly, terms the the

grocery, faster that share. strides, while tremendous made, have and I to we others mean, on than And gain I to specifically continue continue we think grow

the by multiples. to, from food, it’s I perspective still to substantially I there’s U.S. of think mean, lower compared long the penetration look product. ways online if you building the relative restaurant delivery terms say, of mean, go the in grocery delivery of I online in

in that the still perfect, what places the that’s can we the to I very, from that but you future, have team to to delivery today you are superior which to long or will made. make we to of experience, I because the can we sure we get way are quality means the proud long the between you go progress has you the from of store. order prices it very where a online affordable experience think And think I there’s experience to off-line meaning want and is a go exactly that am get be way all that making you the where that the in And what and pay expect

Ravi Inukonda

And upside the commented, Deepak drove about upside few combination to as business. your a seeing second question, we in investment a you What think changed our the had are is nothing has business, terms Obviously, of in the EBITDA some GOV how factors. you we of of philosophy. which in QX in

growing core that continuing to is look quite its in improve. is restaurant the growth When scale row. lines nicely, continuing even business various at at last business, I of of and is The the stable of line grow to quarters strong a profitability several our business for

Our been Growth margins both verticals well strong, annually. both in international a as investment areas, have continue both as new as has to share gain areas, strong first improved and had we quarter. very as well sequentially,

some that in combine the expenses OpEx on the to EBITDA a have business. last Now our rise was in you that’s had if you flat we where operating discipline row, are giving the with that seeing the upside of three for quarters

back to when have not That the in said, and we times business, to drop bottomline. there’s the going any going to for that to looking be reinvest investment it’s be constantly to us but there’s efficient are okay

to being is with disciplined that growth, philosophy guidance our general, one of investments our that disciplined we is to and parameters continue drive the while we have efficient use given. the EBITDA In

Operator

Thank you.

of ahead. & next question Bernie Company. Please of go McTernan Your comes Needham line from the

Bernie McTernan

the I question, know general been a for just Maybe are marketplace about recently any with for restaurant-specific quite how Starbucks, you. in driving contribution some how And being has like Thank and benefit there? AI time, you. GOV but Thank just thinking probably profit partnerships opportunity any then the per are both Great. important for you those announcement opened that to the AI way integrated opportunities order DoorDash? and the guys new up? for second, are frame generative

Tony Xu

both. Sure. It’s can take maybe Bernie, Tony. I

out as I as fast super a a that’s piece right? candidly of the certainly, And of just making day. terms as first in technologist, this AI, changes developers seeing are I well the But around On mean, it’s also is both generative product. every exciting, think coming user movement, how

on camp the the and us, for in bits think battle is important for it’s the have of the making our battle. in sure attention battles battle going two of commerce I local really atoms, company, digital defining can to remind the for purpose that much to are win which ourselves category we when you that our purpose, build we second very so, And that means

how about logistics most in interfaces most that to quality focus much the the we attractive asset and highest very the So the still network make are and sure digital with useful last-mile we future. making as sure think that, that is assistance remains it

build promise try running the been already we some that I has experiments But latest the absolutely a have said, to especially world it mean digitize generative to published and work when different for when for AI. doing we comes great internally achieving catalog lot city. the do of are gains it with every the I to productivity models manual physical think that and have we that of

a by a experience, has easier consumer I friction. lot of making think lot well for shopping experience, promise it as reducing the

be lot in think to fun will So and a should of part I things that. come of future expect you the big a

companies really this like was of certainly, restaurant joining our adding question second your right? product, always with Starbucks think building the platform. a around has mean, especially selection been and big part I I

increasing affordability improving as of us, for and the It’s customer mean selection certainly support. as improving of about our quality I experience, what it’s delivery always to the adding service, the customers well about want. the

something sure on super give been we that are selection so do want. even key always Starbucks partnerships. is can and has to look making more customers forward we what to they that we excited to Bringing And

Operator

you. Thank

of Your the ahead. Bank go next America. Michael McGovern, question Please line comes from of

Michael McGovern

Hey, I taking two. had guys. Thanks my for question.

and in a of types the customers. will was of I pick and them deliver lot of promotion about, for packages the and have UPS service application First new you up where advertising FedEx noticed

reordering because other really around high new to are, things services layout was what the And so secondly, and feature? application what be I just more because seamless I it wondering So a a a interface that then ordered there’s you from the the that much your redesign on differentiated in it’s noticed strategy in the seems cool that -- like level is I service, really the in to it have seems bit past. of recent it, of

recent So I focus was the redesign? if that this Thanks. wondering with was

Tony Xu

Sure. Tony. Hey, take questions. those I will Michael. It’s of both

Yeah, on package to trying are certainly do. important first that But So are and to, very it’s pickup DoorDash, what I think excited something we the about. really it’s at delivery, recognize around we again,

as many to can What physical as help those we is direction sure physical doesn’t do it necessarily grow occurring, businesses are in connect with that possible And make consumers. terms we matter travel trying is and possible of any which business many which connections. in to

us these having the solve can the for more for -- you alluding States so are in flexibility of order package that lot these the this problems United lot notion that choice of density, returns achieved, one have of was you for customers instance, of problems a orders And kind we of we some of about by terms heard dis we of and a that just in to. in those greatest solving are

at them customer very excited increasingly are early the of stage, things but right things is lot it’s of are many a run now, all higher and in where like, new always at there’s And the that’s happening expectations. one solving about time these things This something of so we we hope really DoorDash. DoorDash

On on improvements some the of to reordering. respect question the with second

to are reorders are the to ordering always our in experience. amongst, engaged trying it particular, very Certainly, reduce most comes friction We consumers. popular when

that But do app. we lot there’s trying to of a things are the to

to We are it make trying faster.

bugs. are trying number reduce of to We the

can We you you find what you can that is might that be are enticing. trying to it make exactly sure things want that discover new that

there’s lot with friction. improve of of the So always to experience reducing things a the always mission and trying it’s do to that are we

Operator

Thank you.

Please MoffettNathanson. the Your of of comes from question Michael ahead. next go line Morton

Michael Morton

us a speak the rate I details to question us to if I like quick hear are early could to SMBs a advertising if you adopters. Thank wondering or any then details sounds last additional larger love the the QSRs how And just you would that help in Thank you. the some on think in question, progressing? is are bookings interest I about had was growth new around be advertising. seeing. you. maybe would their adoption the and It interested, about you just verticals platform? business

Tony Xu

the take question around on I let question. second will Yeah. I the ads first start and will Ravi

are have So on start, certainly to clip, a are it’s we a you ourselves, given that we with put are merchants. of respect to meet consumer also on to have high to hand, return what advertising, And and experience, ad I spend one other the the and great for standards there right on degradation goals advertisers for achieve consumers to see. the especially where the to fast best-in-class the mean, terms is create little which -- possible to best in that, pretty out we hand, off is expect we trying no and

is the important this that desire the business, and is it’s marketplace. ad with think, business, engagement I marketplace important to remember hard an And certainly, do, because any to most any the to of really thing build

but with, balanced extraordinarily run we pro-consumer pace even I whether in the this in addition we see again from is advertising the on and -- a and CPG the this and I ads so more which so side they what -- for segment are that is of way as something kept to to they goes every that have am do want seeing advertisers, the think, very have And really of demands teams to have restaurants well, from, merchants, though well. proud our companies demand candidly, that we

capital SMBs a and the a So world large effectively have some have use incremental commerce to efficient department to we found their very, are to grow local budgets very work serve that have be the with the in excited all when case world largest way marketing cases are very brands this in as you they very the platform. of the finding that largest the way that in heard biggest

Ravi Inukonda

what talked on to your And Michael, second one. specific add question it, to Tony about just the

that EBITDA revenue guidance our ad an nicely, net and growing view year. for is it’s is as the included our of well rest be Our impact what going having it’s business is our business to actually on quite growing, the margin for in

Operator

Thank you.

next line question comes ahead. of Please Mark from go Your the of Mahaney Evercore.

Ian Peterson

Mark. business great engagement guys. Hi, for both can on well an if share It international Peterson those? update This provide Thanks. and U.S. as in DashPass would and on just any could is with the trends there, also Ian subscription in us you be you the

Ravi Inukonda

as terms Ian, thanks sign-ups, subscribers. for quarter, of came of both DashPass off as question. the in another great well

you value you way For grocery, whether is, whether us month, think in pet for could $XX DashPass it’s want convenience for it we get that’s the food, it’s very a about it’s that anything whether us. compelling and your proposition city, retail, whether it’s a

graduate as are are And drive product quality the as the overall that’s business, and driving are as more well as what we product more that’s we making the more is, are up, the we the up, to as we in driving and DashPass affordable, internationally. selection seeing consumers to continuing strength domestically, both to driving

for DashPass We strong quarter with are was QX made us. have for progress very very a we comfortable and the

Operator

Thank you.

from of JMP ahead. Andrew Boone Your next line Securities. Please the of go question comes

Andrew Boone

down bottomline. much. the talk relates Can just it the slowing initial it initiatives question. and taking making? Thanks ask are verticals? may are I for verticals like you guys or talk seeing It more of that margin took new Ravi, growth gave new you my I about more to any what’s greater investments piece wanted Europe. as that what are sounds about then, feels international. traction? that you answer you about earlier to contribution Thanks wanted And about you so willing Can drop on improving. the in an maturing follow you leading to on like now loss up Is to guys. It share you Hi, to just be competitively guys to

Tony Xu

I was Yeah. on question, the start will position. which competitive Europe first around and the

for lot I outside the Wolt, think, of place DoorDash. U.S. runs thesis great remind investment teaming is the a we of up majority to a with markets had this of behind the the who ourselves of

And has of category long and what capital retention in that that have frequency especially the thesis when very really, engagement was that very, is that, will the left. allow growth, a efficient runways highest really you the first most

And Omicron difficult terms that’s comps see have tremendously Wolt the rest I mean of in year, execution Wolt the of you outpacing with seen we against the really the QX year-on-year quickly of of growing of business. and what last even class. certainly

reflection been And of so the I with do as from a Wolt which some to think years able and I now that of it’s growth Wolt+, it’s lot in as a learning we some to happens with of borrowed going of that, other Wolt that quality to newer equivalent, that introduces build think, the DoorDash has so and well strength is again, products as see engagement consumer product the of the to its U.S., only DashPass are products their come. the more from especially

Ravi Inukonda

your of contribution the improving to is growing, as profitability. I Andrew, second And of nicely, growing think dimensions. restaurant One well that’s it’s about it core the terms business of question, terms when two in quite margin I improving, in as think

And progressing when the strong is as I the it well areas, and the investment investment One market I in allocation, think is, look unit do does capital across product consumer fit second when economics? terms product about as at two the of one demand, vectors. terms in of I have -- look they are at

QX What both well both both share margins as as you annually. are as the growing ism well They international. areas, gaining new nicely. are well quite in improving verticals the sequentially as are seeing as as in They of are

Dashers a have efficiency if are especially in of Now new structural which that’s to some seeing we giving business, the on side, and the fact, is advantage that into built out, vertical improvement. margin network naturally a combine the of translating the that you we with already gains rise you consumers where have

saw on put improving, the the you going continue well free if you we for underlying business that It have to are of as and businesses growing, we strong that are us. together, nicely, restaurant early are very both two improving. be in flow generation as they has cash those core the of of When growing well, we these what are similarities strong businesses to drivers all conviction have the these execute areas margins are fundamentals

Tony Xu

and terms are And put towards not any investments. a you the through different the flow of are businesses -- in what the top way, results. seeing are down we and slowing growing that’s just It’s bottomline,

Operator

you. Thank

Your question Please go Morgan next Brian line the Nowak comes Stanley. from of of ahead.

Brian Nowak

Thanks Great. two. I have for my taking questions.

first and one, U.S. new ask thinking Then about year full guide come The wanted people where Wolt. growth about how are on to I do to in about for are the sort do type the penetration? to you of user how the of what U.S. point, new the this to think in kind growth the user second the in you platform grow one that of you and runway at on we

a had of acquired two didn’t been you You asset? a at pretty have executing you maybe you appreciate while. when for Tony, surprises that now high or one the to the clip. biggest what It’s been even quite asset Wolt about the

Tony Xu

both Brian. Yeah. questions. will I Hey, Yeah. take

remember sometimes, which have On in that, I about to users the is product we product getting user often, to use first the important have the question product. no the it’s it’s tried think, versus may acquiring improve more just different who adoption, users to just

up selection pricing, we the customer didn’t support. have we so a quality speed right to or that delivery occasion, of in the whether right and/or messed that customer attract on moment And or the that right means

think large times really, those think how is people I a that blocks I growth. left are to week XX building frankly, there’s eat win the a of times I such for XX and runway why customer the we fact mean any

necessarily not XX are have XX but to serve about of potential. by and per on and It’s the That’s you that to times times users part you one then can that week we that all of week per where multiply journey? it,

in just want at least it of same my to attract that’s a so new the And and brain whether a win in we new occasions to XX all how that use it’s user go or a XX incremental works me, use of happens the case case to that time. times an we and or know the per that, week eating customer times is

So first that’s the question.

believe say would have to I question, is Wolt, further. I come mean, your I things appreciate On which a second I few even that

their really efficient compete first capital I is a just ability think in the I way think, to interesting really very has really, unique. -- been, and

think even it’s and impressive sometimes, were were tighter generating almost especially DoorDash free and and what watch the I a it’s been some easy gold positive forget budgets more in I flow, to of the I is cash to when think do, constraints really as mean now lot smaller that I think, regard. more can

of the testament come. a on for make team outcompete make and such to the good the can we we to the the how that, really but investments, ability experience that’s years will year, keep to sure that to and actually focus product the both retention not And always this just frequency increasing that’s

the I has comment has maybe a of think market, at second European more had think, forefront live the in countries that. or I we other we we because a maybe where more these users U.S. adopt been for around which just live or markets, the is bit the maybe longer sometimes, lot in e-commerce in a is to

the do really thing of a restaurants, kind I really to countries us categories restaurants of and what seeing and the of first goals lot its the very together. online is ability of mission time geographies fast well certainly stores are Wolt lot that’s just physical DoorDash lot that think and but and all shared are same of the same local all that I so A to of Wolt that has wants much -- also come the their think of serve outside become these a commerce for work company growth for allows to having in the to is the true you

Ravi Inukonda

point itself, grow we order to we on that as into just that’s and our users, guidance guidance the as Brian, both do have specific to And frequency baked given. the well expect question

Operator

Thank you.

Youssef Truist Securities. go from next Your of of Please question comes line the Squali ahead.

Youssef Squali

I questions Great. Thank well. have as you. two

Ravi. guidance, the on just So

cash was or thinking that So, of topline. again, really impressive. the Anything in lack to pretty look about the look last the at et Has XX%. we be of that be kind like considering shortened? hit then And business -- back three look kind of as GOV you. visibility potentially like, guess there looks macro, helpful? certainly the execution cetera? really on flow more it at free months, so the Wolt XX% would there out I -- related causing at low flow, quarters, if total the could I if How timing your you for has the XX, last should free stronger been midpoint, growth market positive the the timing is of the to at I the GOV, nine Is anything just that that’s non-restaurant of so the Thank annualizing be cash is decline maybe it that number now to just of kind --

Ravi Inukonda

Yeah.

Youssef, let first the with me start one.

year. I That’s us continues the I consumer as very GOV we seeing up earlier the the points guide GOV at couple the be of as look strong. here. for feel giving that what’s well bump signals the rest order that, about of both itself, business. to I On the mentioned engagement optimistic confidence retention, a When to in are frequency,

of the seeing that so do in of are comp we the on Wolt growth lap impact an point you year. specific June, in the the itself, acquisition rate second your To half

well free margin. of terms in look terms very question strong flow, In cash second I business in as it the both of when of verticals first your at had quarter, terms a in improvements in new QX, growth, as on

you driving the just margin. to in contributing are the affordable, we seeing and continue what to in are growth, the efficiency but that make more is business underlying seeing improvement in to topline improve also not efficiency is, we the the product as are as that’s And we business quality, continuing

EBITDA comment the not going feel basis, to in the of dollar and I the but absolute rest are the about on On for that’s year. our investment we included good levels it, guidance

Operator

you. Thank

comes next Ron Please Josey from line Citi. of of ahead. question Your the go

Ron Josey

Great. us two. I in have to were you the you Tony, drive Thanks what the Can help understand question. metrics. taking and in efficiency quality about double-digit talked for grocery just these improvements quick I improvements vertical the quality would improvements year, in And on think helpful? contribution a Ravi, be convenience any clarification become insights we a positive. saw last contribution overall just variable margins, then, as and efficiency, letter,

And I talked you here, or newer grocery at given are advantage contribution that Thank of so do if start others wondering least to verticals or you. by year? end am expect alcohol other delivering or contributing the perhaps about this you structural variable margins the

Tony Xu

Yeah. Hey, Ron.

don’t hard of On the problem the literally of the hours stems first grocery. part question this that variety on big on quite to to about talk reasons, around a fact quality physical know we from And the and is, in improvement reasons. always exactly can product A solve the that different today stores, that’s stores, for go grocery a shelves. their of for what’s all

see saying can making in you that you that go have I we that’s But at of get still gotten to where want experience. are I am I not and this think, exactly ways of what in the ordered. an earlier to question we the to terms mentioned, that I long product we better problem sure we terms perfect, are

cohort are about But grow. way that I in that, we the you that result in capital talked increases think to as a engagement we been I think that’s have the this strides years with doing showing, of basically efficient two letter and and in a seeing the tremendous both therefore,

improvements I that efficiency up in a that me, through results showed capital of from best Because one-to-one -- quarter. most some that to nice is of quarters the think to very many the stemmed was saw we this quality that, work and the achieve that in way really and product in correlation

Ravi Inukonda

gains. to is And resulting the your we quality Ron, like, driving some improvements efficiency just second in that point, right, Tony are what of also to to the said, on in the business add

that improve. talked convenience and profit about to positive you third-party it’s is Our continuing variable

our All a categories talked are letter, umbrella, convenience good overall well basis, annually. business, as grocery, progress our about margin is our DashMart in our as the new We about on both it’s improving. sequentially, within whether and we feel verticals third-party new verticals improving the

Operator

Thank you.

comes line of go from ROTH Please Your next ahead. MKM. the Kulkarni of Rohit question

Rohit Kulkarni

you more start internal applying of then AI of profitable second the is these margin had marketing Okay. productivity taking internally term, all of kind investor’s know AI DoorDash maybe guess about and I to all first new wave and just to it question. they are are adopters generative And Thanks to is since Silicon couple using figure speaking, you much on top become are engineers, it’s question a deem vertical AI, as about they that One of feels profile. be AI improve on salespeople. of they you starting to productivity pull just in for talk to maybe the But Valley out I on overall feel longer going been how margins, do mind. my of ahead years thinking companies have these tools? the And structurally, every processes, verticals

profits as think versus takes most and can on all steady the you maybe various profitability state overall them. layering start core the restaurant between such? verticals talk incremental you profitable kind should How puts about as new of the structurally, So business the just the we about from

Tony Xu

of for to the certainly With about Look, you and some change asked AI the I can first Ravi of that represents functions respect I second. the of these maybe in its take will think, the question. a it and mean, I ability productivity lot trajectory question Yeah. the gains. promise to take

financial one a will are going to company, the with of results for those that’s on advanced now number who with very to the hard they tooling. more in think In terms same terms hand, how be of have expressed more you estimate, hopefully productivity of because what I have people do gains can

talent engineering of higher hand, the almost demand number not things engineers Take higher. on customer, seems are the for have to instance, But just to always what and going is, the be as go to well forget the expectations the build. as to and customer’s the never of enough in number of then for like coding, other frankly, you terms higher

kind direction, you that I expectations balance also the will competing believe to expect and productivity would going other one will higher so on this, be go for think of I I all one the gains, and in so which always higher higher to us think going but the two certainly which of and that is I two see, the forces -- are And hand, have what customer through. is be of then

Ravi Inukonda

is. your Hey, margins. Rohit. The it it I is second on question about think way On

as small business restaurant overall improving core still in industry. portion for as are sales well terms But a profitability. we restaurant of of is Our overall growing, the the

that quality, So to we business. to going more we invest growth that the continue It’s that’s affordable, because behind product that behind drive behind long-term important invest continue business. to invest making in

a as terms the improvements sequentially, That business. driving of both Secondly, Tony earlier on we of in on verticals, annually. as quality what that’s in new seeing as the the are business is efficiency question, is, well touched whole some that in margin, improving previous

But our business the well if as I merchants, we generation improve free drive and that as improve to is the overall continue the consumers, us. still we are in a product to there invest we think It’s for long-term underpenetrated large, product, for that’s very Dashers. experience and going to flow to continue continue are going to cash market

Operator

Thank you.

question comes from Goldman of line Sachs. Your Eric Sheridan Please go next of ahead. the

Eric Sheridan

taking Maybe for the two quick in. can if much so Thanks I ones, question. squeeze

XXXX the landscape what merchant term. where better you and investments how relationships velocity of should the more more curious, just merchant of last app you app of all direct have across and look over of the beyond, shoppable market I out number some overlaying the built we platform need continue share talked more have can gain be you and driving possibly SKU levels call and the of That on Thank out, as to then look for you user And side your We among on those when to thinking about volume make when adoption to base, am merchant making order how about drive see do a increasing First, frequency you key think all the be your -- plate about continue lack you deeper SKUs? merchant to and in growth, your the you the you and of given app, will greater side? two, that number one. on you. traffic further diversification you all do would

Tony Xu

Yeah. Hey, Eric. I will take both of those questions.

problems have the more with goal solve and work sales of answer mean, more to that them their more same-store in is of the going order and more with to I them merchants, short helping to On respect first improve we and the profitability. question with deeply to basically, are

was these right? a inside span example, to back we There and a guest XXXX And I digital in-store swings, staff they off for focus take merchants to when the make for maybe if of were particularly take to XXXX, of up the take demand years little mean, things sometimes they stores. meet pedal big can needed consumers sure a bit. that roaring bit for can in that out and

instance, to You are now lapping swing see their in-store returning as into they into these and merchants are this back for years digital of of channels. now starting back, investing growth those some are

I see kinds these to you flows. of are think and going So ebbs

those being do Storefront we channel Drive relationships the products enough or the with all customers, long-term like that’s think Marketplace. name understand of through this and merchants DoorDash build and the for I and their engaged with really of products is the the and DoorDash whether those with customers, Platform better do third-party in first-party powered better tools But customers, to how it

the grow, more I to continue on always expectations expectations, do more are and And to so this have going because there consumer be just a to just like for to that going And solve are I they too. think to merchant think a growth owner, are you of always to dynamic. the business profitability a and thinking, between -- XX going are are are thinking and you my owner, when you mom you things have or end particularly, are but you if single-store day, at problems, we lot there’s like

is, how more and endeavor destination. this to the are that more phenomenal think, Your I it’s on, a are marching -- I second question. shoppable make more the we going do I becoming of it’s certainly you be we and mean a think app multi-category question where is

you you fact see this, this that more I than customers now I convenience see for the mean in more in numbers think, we even into else new the first certainly acquiring are sectors and anyone time. the the and and grocery

think to they and Goods whether And able lettuce that in grocery a from a those experiences, customers is pound coming to us to trying store. bat DoorDash Sporting to be trying are buy deliver so baseball expect I or of that a upon telling DICK’S buy from

doing now. are of we so right And things lots

are We catalog. improving the

are sure there’s improvements that to search. We making

we experience. are can shopping sure that create We item-based making an

have makes There’s that our things and physical it digitally, goals order catalog we can catalog lots the in that in with concert to of and so consumers merchants, do merchant the that to world then the to they sense that achieve too. present

is it then proud And important this work that make can delicate everyone. will DoorDash sure something responsibility for be everyone, we results to have if of. mean the I we are the for work believe we and that that very can

Operator

you. Thank

Walmsley of of next Please Lloyd comes Your ahead. the go UBS. question from line

Lloyd Walmsley

some if just Thanks. the I can. numbers, Two questions on of

like that And be up margins, to I nice to or just expand just in there new about XQ. as if and that if so growth of -- Thanks. at we gross sales then, newish a am step-up similarly, that’s First, bit a if XQ marketing, kind stepped if thinking looks that? new it continuing wondering profit from look saw a a we we should level wondering normal.

Ravi Inukonda

one will first. I Lloyd. Hey, Yeah. the gross take margin

are mentioned margin you to was what On higher call, gross exactly levels. I business. seeing QX that going the last That’s be XXXX than in the

over driven play on which logistics the seeing a are more cost improvements of of number the product come Dasher our a per half, side, through at terms factors efficient you we and and year made last few here, leverage order. that A has have engine in

been have and that a to continue priority what has is work key retention us higher. on quality noted that’s we for driving Quality we

and benefit We terms the are well of growth, costs. seeing lower as refunds credits as in

That specific That, margin our combined -- that’s earlier, don’t margin. operate business, ads our the run a mentioned impact with on to that’s I we which an having target. said, also or growing business

goal to the to Our invest efficient P&L flexibly is to in drive growth. be across able order

of for cost Dasher that That’s sales your was we question which topline marketing, your acquisition more in and sales had and and volume higher. order second marketing volume, To support us, strong driving a in on result going terms to of is quarter QX to acquire Dashers. up, the

would I volatility. said, much into read That not the too

doing that last on expect made. over a side leverage and at in sales included from that sales we If the look ton we the you of there marketing and improvements are all we our of take do course leverage given. that EBITDA on be guidance I marketing, more have a product to view the year, and is have

Operator

Thank you.

comes ahead. Please question from Jefferies. John last line Your go Colantuoni of the of

John Colantuoni

how I and or retail they my than curious know we grocery non-members. on But members you that, question. color member once are and user across after bit into members any and And Do how become retail these grocery, vary convenience, dig to more DashPass adoption frequency than like to am and of restaurant verticals if provide -- order that Curious Great. to order new related increase to member? for a more DashPass more little compares verticals. a even Thanks hear upticks orders more taking to becomes orders Thanks. able non-members?

Tony Xu

each shopping your best-in-class to those make within the one category the I a Hey, Instead, trying we we that the the we into customer John. are to think that trying we allow build which and sense is trying occasion. the most for choose to particular experience to for experiences other. of answer then are that them do sense way are It’s steer or category Tony. run don’t what the will necessarily customer one questions. business try in to I

city And the greatest point, stitch then we everything to that to across are because is membership. DashPass your can DashPass, provide give inside to possible within we value, you that your something going

I So we think one to steer or that way trying people necessarily the are don’t other.

because a relative makes have that is like shopping we categories. to food to highest that that intuitive probably prepared times category we other meal, possible to sense, week, XX the have frequency. But something times XX which is it’s think highest going restaurant the I

into earlier foods said, question mentioned are the now industry that attracting that restaurant else. outside new an than to I of more or we But customers earlier anyone

restaurant shopping people time, first not shopping et their liquor grocery et to cetera cetera. items food, for are so And DoorDash from items, the and their retail but now for their also coming needs,

as good each things in where So best overlay with the continue I we think experience the and the and possible will of category within then those long position. value that one this a be then to as is shopping DashPass, of just across build we stitched categories

Operator

today’s Thank at are time. concludes conference. you. this further no This questions There

now may disconnect. You

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