DoorDash at JPMorgan Conference: Expansion and Growth Prospects

On Tuesday, 13 May 2025, DoorDash Inc (NASDAQ:DASH) presented its strategic vision and performance at the 53rd Annual JPMorgan Global Technology, Media and Communications Conference. CFO Ravi Inukonda highlighted the company’s expansion beyond restaurants into new verticals and its commitment to empowering local businesses. While DoorDash sees growth opportunities, it remains vigilant about cost management amid macroeconomic uncertainties.

Key Takeaways

• DoorDash is expanding beyond restaurants into grocery, convenience, retail, and alcohol.
• The company expects Q2 take rate to be higher than Q1 and forecasts stronger performance in the second half of the year.
• DoorDash is exploring AI and autonomous delivery solutions for efficiency gains.
• The company is optimistic about becoming a leader in grocery order volume share.
• International expansion continues with a partnership with Deliveroo, enhancing its presence in Europe.

Financial Results

• Take Rate: Q1 take rate was lower due to investments in Dasher supply and reduced consumer fees for grocery within DashPass. Q2 is anticipated to see an increase.
• EBITDA: Q1 EBITDA grew by approximately 60% year-over-year.
• Revenue Generation: DoorDash remains cash flow positive with a robust cash balance.
• GOV: The company reports a run rate Gross Order Volume (GOV) of over $90 billion.
• Working Capital: A minimum of $1 billion is required to operate the business.

Operational Updates

• New Verticals: Over 25% of monthly active users engage with categories beyond restaurants.
• Grocery Leadership: DoorDash aims to lead in grocery order volume share.
• International Presence: Profitable in over 20 countries, DoorDash ranks either first or second in spend share.
• DashPass Growth: Slight acceleration in growth from Q4 to Q1.
• Seven Rooms Acquisition: Enhances merchant operations and marketing through a closed-loop system.
• Advertising Revenue: Primarily generated from U.S. restaurants.

Future Outlook

• Growth Drivers: Focus on improving selection, quality, and affordability in U.S. restaurants.
• Category Expansion: Opportunities to expand user base and use cases on the marketplace.
• International Expansion: Partnership with Deliveroo to cover nine European countries without overlap.
• B2B Platform: Plans to scale existing services and introduce new offerings.

Q&A Highlights

• Macro Impact: DoorDash prioritizes internal metrics over macroeconomic reports, analyzing 8 million signals daily.
• Customer Acquisition: New users often start with restaurants before exploring grocery options, with an increasing number beginning with grocery.
• Merchant Feedback: Positive reports on incremental and same-store sales growth through DoorDash integration.
• AI and Automation: Ongoing AI experiments to enhance internal efficiencies and development of land and air autonomous delivery solutions.

In conclusion, DoorDash’s presentation at the conference underscored its strategic initiatives and growth potential. For a detailed understanding, readers are encouraged to refer to the full transcript below.

Full transcript - 53rd Annual JPMorgan Global Technology, Media and Communications Conference:

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. Thanks, everyone, for joining. Saving the best for last. Sorry. I’m Jack Addison.

I cover US TMT spec sales here at JPMorgan. We’re pleased to have DoorDash CFO, Raveen okonda, with us today. So DoorDash’s mission is to empower and grow local economies. DoorDash has become one of the world’s largest local e commerce platforms, and we estimate that its industry leading food delivery share in The US is north of 60%. Ravi joined DoorDash in 2018 as VP of finance and strategy, became CFO in March 2023.

Prior to that, Ravi spent about three years as head of finance at Uber Eats, prior to that was in the VC space. So welcome, Ravi.

Ravi Inukonda, CFO, DoorDash: Thank you for having me.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: So kicking off with background, big picture. As I said, DoorDash’s mission is to grow and empower local economies. You started with restaurants and have now moved to grocery, convenience, retail. As we look five to ten years down the line, how do you think about incremental opportunities within these categories?

Ravi Inukonda, CFO, DoorDash: Sure. We also do alcohol by the way. 5PM on a Tuesday evening. I’m sure Doug and Jack here are not offering alcohol, I would open up your DoorDash app and go get yourself a beer. But, yeah, I mean, you know, mission of the company has always been the same since day one.

Our goal has been to help local businesses. We wanna grow local businesses. We wanna support them in a digital economy. We want them to thrive. We think we wanna support local businesses both on premise as well as off premise because they’re getting more and more integrated.

We want every local business to be omnichannel. We started the business about a decade ago with one product, which is restaurant delivery in The US. And today we have many products. We cover over 30 plus countries. But the ultimate goal has always been the same, right?

Continue to focus on the product. As we’ve thought about the business, there’s sort of two dimensions, sort of strategy wise, that we’ve taken. The first one is our marketplace business. Think of that as our demand generation engine. Think of that as our consumer acquisition engine.

We started that with restaurants. Today we’ve expanded that to many more categories outside of restaurants. But when we look at the opportunity, to your question, we still feel like it’s very, very early. I mean if you just imagine, we offer categories that people use on a daily basis, but consumers still don’t come to the app on a daily basis. The number of users that come to us order with us every single day or every single month is still a small fraction of the people that we cover.

Just take Mother’s Day for example, right? Like this past weekend, we were number four on the App Store because people started to realize DoorDash is being more than just restaurant delivery, right? People are ordering flowers, people are ordering other products. But when I look at the selection or the quality or the categories available on the platform, I think there’s still a lot of opportunity for us on the core marketplace or the demand generation side. The second approach to strategy we’ve taken is what we think of as a business to business services strategy.

We started that, we call that our commerce platform. We started that business about seven or eight years ago. The first sort of product that we released there was Drive, which essentially was logistics as a service. We said we want to help merchants power their own channel. So we said the logistics comes from DoorDash, but the consumer entry point is on the merchant’s own channel.

We extended that a few years back. We said we’re going to power the merchant’s website as well. That product is called a Storefront. Now the more recent acquisition that we’ve done, Seven Rooms, is essentially an extension of that strategy where we’re going and saying, hey, what other services can we provide to merchants? Because ultimately we want merchants to be able to do their business both online with us, with the marketplace, as well as power their own interfaces, power their own in store experiences as well.

The advantage we have is we have a distribution network. We have the technology, we have the data, we have the analytics that can power some of the merchant services solutions along with the marketplace that we have. So when I think about the opportunity over the next five to ten years, going back to your point, lot of opportunity to grow users, lot of opportunity to grow the use cases on the marketplace side, lot of opportunity for us to, A, build and extend the services that we have today as a part of our B2B offering, but also extend more services in the future. Great.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Obligatory macro question. So you guys have continued to see healthy consumer demand despite everything that’s going on around us. Do you think about the resilience of restaurants and other verticals?

Ravi Inukonda, CFO, DoorDash: We don’t spend a lot of time on macro because we’re not waking up to the journal saying, hey, economy is doing well or the economy is not doing great. If you think about it, we get 8,000,000 signals every single day. The volume today is going be about 8,000,000. So we look a lot at our own internal metrics to see what we’re seeing. We have a team of analysts that are focused on pouring through the data to figure out, hey, what’s actually going on in the business?

And when we look at the underlying cohorts, they’ve been pretty strong. We look at low income versus high income We look at the various parts of the country, whether it’s the coast or the middle of the country. The demand patterns continue to be very strong. And we ask why has that been the case?

And even if you think about the last four or five years, when the economy went through a bunch of different gyrations, whether it’s COVID or markets reopening or peak inflation, the business continued to be pretty resilient. And I think there’s two broad reasons. One is the category itself is pretty resilient. If you just think about it, people spend the most amount of time on food. People eat 21 times a week.

Whether it’s food or groceries, the categories themselves have been very defensible. And if you look at the defensibility of the categories over the last five or six decades, even at different times of economic downturns, food in general as a category has been pretty resilient. Not just on our platform, in general food services. And the second one is the product has gotten better. If I look at our product compared to five years ago, if you look at our product even two years ago, the product continues to get better.

We have more categories today which we didn’t have before. We have more stores today which we didn’t have before. DashPass has continued to grow. So I think the combination of the resilience of the category itself, plus the fact that the product continues to get better, which is obviously something that we work on on a daily basis, I think that’s partly the reason for what you’re seeing in terms of the overall demand continue to be extremely strong on the platform.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And hypothetically, if you were to see some impact from the macro, can you talk a bit about how that would change your approach to running the company and potentially other areas of cost that you can leverage to ease through that?

Ravi Inukonda, CFO, DoorDash: Sure. I mean, I think it’s a good question. I mean, think we’re not looking for sort of like signs of weakness to change on how we operate the business. I think one of the commonly misunderstood concepts about our business is we take a very long term view to investment. We’ve always talked about the fact that we’re constantly reinvesting back in the business.

But at the same time, we operate the business on a weekly basis. Even at this scale, dollars 90,000,000,000 plus of run rate GOV, we look at the business on a weekly basis, we have weekly goals. Every single week we are pouring through every line of business, metrics, underlying input metrics to see what they’re performing, right? Because constantly what we’re trying to adjust is where can we double down, where are opportunities for us to increase And we do that consistently no matter what. If you think about the performance of the business over the last four years, I mean that’s what’s contributed to the growth in the business.

So even in times where we feel like, hey, the consumer conditions are different, we have enough levers at our disposal that we can adjust the business. A natural hedge in the business is Dasher. In times where we’ve seen weakness on the consumer side, Dasher just becomes a natural hedge, which helps us manage the P and L. But this is a business where we are focused on two things, right? One is the product experience and the other one is the underlying metrics.

So it’s almost like a mathematician’s dream because if you love math and if you love the product experience, it’s a business where we’re constantly managing minute changes almost at a basis point level to ultimately drive the long term retention and order frequency that you’re seeing in the business. All that to say, right, we have a great handle on the business and we do that on a weekly basis.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. So delving into the different business lines, you’ve called out five key focus areas Sure.

Ravi Inukonda, CFO, DoorDash: U.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: S. Restaurants, U. S. New verticals, international commerce, and ads. So starting with U.

S. Restaurants, food delivery is now still high single digit or digit penetration of restaurants. What do you think it’s going to take to drive that penetration higher from here?

Ravi Inukonda, CFO, DoorDash: Sure. Mean, I think it’s again, go back, right? Like, the product itself, when we think about it, it’s not quite where we want it to be. And we think of it across three dimensions. It’s selection, quality, and affordability.

Selection, I mean, one thing consistent about restaurants is new content continues to get created. 20 of restaurants go out of business sort of like every single year net new restaurants. So selection is a game where you continue to need to add more content and more selection. It’s almost like a never ending thing that we have to go after. And if you don’t have the selection, then the consumer is going churn away.

So that’s why we have to constantly keep up with new selection on the platform. Quality, again, we’ve made a lot of improvement. If you think about where the product was, whether it’s in terms of delivery times or credits and refunds or missing and incorrect or the experience that the end consumer has. But still a lot of opportunity for us because we still make a ton of mistakes. We still have a lot of defects.

The goal is to continue to fix those defects as we go ahead. Finally, affordability. I mean DashPass has been a key affordability lever for us. There’s many consumers that can benefit today by being on DashPass, but they’re still not on DashPass. Still a lot of low hanging fruit for us to continue to improve the value proposition of DashPass.

So if you think about the growth, sort of like how we think about it, it’s improvement in the product driven by underlying improvements in selection, quality as well as affordability.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Okay. And thinking about that growth algorithm, how do you think about MAUs versus order frequency?

Ravi Inukonda, CFO, DoorDash: Yeah, mean, think from a modeling perspective, I know people think of it as an equation which is MAUs times order frequency. But I’d say that’s probably a wrong way to think about it. Because any improvements that you do in the product ultimately will drive both. Think about it, right? If consumers come back and order more with us, do you think of that as order frequency or do you think of that as retention, right?

It’s two sides of the same coin. For us, what we’re trying to do is continue to increase the number of users on the platform. So users are still growing at a very healthy rate. At the same time the order frequency continues to increase. So just in the Q1 results itself, MAUs have hit an all time high.

They continue to grow at a very nice clip. Order frequency has also hit an all time high. And when I look at the underlying cohorts, the cohort behavior continues to be very healthy. So newer cohorts are joining at higher order rates than before. Older cohorts still continue to engage with us.

Even cohorts as old as like eight, nine years ago, they’re still engaging and ordering more with us over time.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. And net revenue margin take rate is a little bit lower in Q1. It was a sticking point, it felt like on the earnings call. Can you just talk a little bit about the drivers? What gives you confidence that will step back up into Q2 and then accelerate into the back half?

Yeah, maybe I’ll talk about the drivers and then

Ravi Inukonda, CFO, DoorDash: talk about like what the confidence in the step up in the back half of the year. I mean two simple things, right? One is Q1 is usually a stronger volume quarter for us. We see good volume in Q4 and Q1 just because the weather is colder, people order a lot more. So we invest in Dasher supply.

Very seasonal, happens all the time, happened last year, happened the year before. The second one, we found an opportunity to reduce average consumer fees structurally for grocery consumers within DashPass. So those are the two reasons on why take rate was lower in Q1 compared to Q4. But I think more people thought of it as like, hey, did the promo activity go up? And the answer is flat out no.

When I look at the promo activity in Q4 versus Q1, it’s fairly consistent. It actually didn’t go up at all. But I think the second and the more important thing is, which is important to understand, is the way we operate the business. I think what we’re trying to do constantly is generate improvement in unit economics, invest that back in the business as long as it meets our IRR threshold and it drives retention and order frequency. So in Q1, were sitting there.

We had a lot of goodness from cost of revenue. We had a lot of goodness from other parts of the P and L. You have two choices to make. We can let it drop through the bottom line, that gives rise to more EBITDA. Or if we find good opportunities, we can invest that back in the business.

Going back again, this is a highly manicured, highly managed business, right? We’re managing the levels of the business on a weekly basis. When I looked at the EBITDA, that was pretty good, right? When you looked at EBITDA dollar growth year over year, that’s roughly about 60%. Found good opportunities where we can structurally lower the fees and that leads to more retention, more order frequency.

For grocery specifically, where the business is growing, we added about six to seven points of order volume share year over year. We said this is a great opportunity for us to continue to extend that lead. And again, we’re doing this in a manner because we are comfortable with the unit economics of grocery, We’re comfortable with the overall EBITDA dollar generation in the business. So we said this is a great opportunity for us to invest. Now I think to your second point around what gives us confidence, right, remember, Q2 take rate I said on the call is gonna be higher than Q1.

Second half is gonna be higher than the first half. It’s a couple of things. One is ads is gonna continue to grow as a percentage of the overall business. Two is unit economics is business as usual. We’re continuing to improve unit economics.

So what happens in our business is business as usual unit economics continue to increase. There’s going be pockets in time where we say this is a good opportunity for us to take some of that and reinvest that back in the business. Q1 was one of things. Because ultimately what you’re trying to do is drive retention and order frequency. So you’ll see some of these variations.

But again, when you think about the GOV growth, that’s been very strong, not just in Q1 but for the last several quarters. When you look at the EBITDA dollar production, we feel very comfortable because that continues to be pretty healthy and that continues to grow at a nice clip. So we said there’s a great opportunity to invest. We’ve taken advantage of that.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. So moving to grocery and new verticals, you said on the Q1 call that you expect to be the order volume share leader the course of this So can you talk about what’s driving those share gains? What gives you confidence? And then maybe just dig into the distinction between orders versus dollar volume.

Ravi Inukonda, CFO, DoorDash: Sure. The share gain that we talked about that we’re going to be number one is based on volume, not on spend. For us, I mean, what we’re seeing in the business I mean, grocery is a four year old business for us, relatively new compared to our restaurant business. Today, what you’re seeing is more than a quarter of our monthly active users order from categories outside of restaurants. And the thesis has always been when users order from multiple categories, the overall retention on the platform continues to be higher.

That’s exactly the same behavior that’s actually happening right now on the platform. What’s driving the growth that you’re seeing in the business is compared to two years ago to today, we have majority of the top 20, we have majority of the top 100 grocers on the platform. So selection on the platform has gotten better. And if you’ve experienced the product a couple years ago to today, overall quality of the platform continues to get better. So you have a combination of A, the selection getting better as well as the quality getting better, which is driving more users to come back and order more with us.

But the key difference is we have a structural advantage because we have tens of millions of users that come to the app every day, every single month to order restaurants. We’ve already spent performance marketing dollars to acquire them. We’ve already enrolled them in DashPass. It’s easier for us to point them in terms of grocery or retail versus a standalone where you have to go recreate the consumer acquisition engine. The same thing exists for Dasher, right?

You already have millions of Dashers on the platform delivering restaurants. What grocery does in fact is it increases the density of the platform, which means there’s more volume, which means the efficiency is higher, Which again gives rise to unit economics. So we are sitting there saying hey, this is a business where we think we can go solve the user experience. The unit economics look pretty good. They’re improving when I look at the gross margin.

The flow through from gross margin to contribution margin is pretty high. And we think we have a unique advantage where the consumer experience, we can actually solve. So we actually think this is going to be a pretty large business for us over time. Great. And I want to

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: dig into the customer portion and then the merchant portion in a bit more detail. So starting with customers, you’re adding one of every two new customers to the category. Is that coming from cross sell, dash pass, or is it new customers to the overall platform?

Ravi Inukonda, CFO, DoorDash: For two new verticals? Yeah. Yeah, so I think broader question is what’s the customer profile for new verticals look like, right? Still majority of the consumers to new verticals join the platform for restaurants and then they cross sell over to grocery. But what you are seeing is today, some new users start their journey with grocery as the first order.

And that percentage and that number is continuing to increase. So people are describing DoorDash for grocery as their first order and that number continues to increase. But the majority is this concept of cross sell where consumers are using both restaurants as well as grocery. And I get a lot of questions from investors saying, hey, does a grocery business look like? What does a restaurant business look like?

Are you acquiring consumers just for grocery? No, we’re acquiring consumers to join the platform. And eventually you’ll get to a point where users will just come to us. They’ll use us for everyday local needs, right? Whether it’s grocery, retail, Sephora.

You’re just gonna have a marketplace where people continue to use us for multiple categories and the overall retention will continue to increase.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And then taking the merchant side, you mentioned that the majority of the top 20 grocers are with you at the moment. So can you talk a little bit about how those conversations have evolved and how it’s changed over time?

Ravi Inukonda, CFO, DoorDash: Sure. Mean, you’d asked me about five years ago, would have said selection was gonna be a hill to climb. But today we feel pretty comfortable. We have most of the major grocers on the platform. And when we go talk to some of these grocers, what they tell us is two things.

One is A, it’s incremental to the sales that they’re already seeing. That’s why this concept of exclusivity I don’t think will exist in a few years. I think every grocer will be on every platform. Two is we’re driving same store sales growth for them. Two, what we hear is the quality of our interaction is much better because we’ve spent so much time on the integration of quality between us and the grocer, between us and the consumer.

So they’re pretty happy with the quality on the platform. Now what you’re starting to see is in some of the top 10 to 20 grocers, we’re already number one in terms of volume share. Even though many of those grocers we’ve just onboarded in the last couple of years. So overall, as a platform, we think we’re going to be number one in the next, call it, year. But even in some of the individual labels or individual brands, we’ve already gotten to being number one in terms of order volume share.

In terms of the unit economics, we feel pretty good about where they are.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. Shifting to international, can you talk about how you think about your current level of scale? Obviously, you recently announced acquisition, and where you think you need to get to over time.

Ravi Inukonda, CFO, DoorDash: Sure. Let me start three years ago. We partnered with Voalte. That was middle of twenty twenty two. Roughly it’s been about three years.

Partnered with Mickey and team who we thought very highly of at the time of the acquisition. That was part of the criteria for the partnership there. We’re very pleased with the performance. Overall international is growing substantially faster than peers. Obviously growing faster than our core restaurants business.

We’ve gained share. We are either number one or number two in terms of spend share in more than 20 countries. The overall international portfolio is gross profit positive. We feel really good about users, order frequency which continues to increase. We launched World Plus roughly about eighteen months ago.

That business continues to scale, which is similar to DashPass in The US. So overall, when we look at the current footprint from an international perspective, we still see a lot of opportunity. It’s continuing to grow users, continuing to grow order frequency. But at the same time, the other key learning we’ve had is our team has executed extremely well. So we looked at it and said the team actually has bandwidth to do more.

That’s part of the reason why we said we’re going to partner with Deliveroo because Mick and team have done a great job with Voalte. Now we’re saying, hey, we can expand that and we can cover Continental Europe with the partnership with Deliveroo, gives us access to nine countries which are complementary with no overlap at all.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And then thinking about structural differences, US versus international, we touched on this briefly off stage, but I I’ve spent some of my career looking at the European players. Right. One of the things that surprised me, US versus Europe, is just the inherent cyclicality of So maybe if you can touch on what you think about that cyclicality and any other structural differences you’d call out.

Ravi Inukonda, CFO, DoorDash: Yeah, I think, you know, I don’t think too much about the structural differences because I mean, it’s very similar even in The US, right? Operating in New York is very different from operating in Wichita, Kansas. I mean you have just very different in terms of operational behavior. Same thing is true, right? We operate in Israel, we operate in Finland.

It’s very different in terms of how we operate. But the core is consumers want convenience, merchants want more sales, couriers want flexible earnings. I think that core fundamental principle has not changed. So when we look at that and we say hey, let’s apply the same playbook, let’s apply the same operational excellence to all of the countries that we operate in, the end results are retention continues to improve, order frequency continues to improve. But the core in this is where we started, right?

The fundamental principle for us, it always goes back to having a better product. This entire business works on two things. It’s product and math, right? If you’re focused on building a great experience, not just for the consumer, for the merchant as well as Dasher, that drives retention higher. That retention paired with operational excellence and data and analytics ultimately drives the results that you’re seeing in the business.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And then thinking about new verticals in international markets, I can definitely see a world in which alcohol would do quite well in The UK. Absolutely. But how do you think

Ravi Inukonda, CFO, DoorDash: about those adjacencies and the expansion there? Sure. I mean similar to what we’re seeing in The US, mean new verticals I think is a newer category even in the international business. They’re all growing. In fact in some of the countries, because there is no traditional organized e commerce such as an Amazon.com, people rely on Vault for many of their non restaurant purchases as well.

So I look at the penetration which is volume in those countries that goes through grocery and non restaurants compared to the overall volume. Some of the percentages are actually higher in what we are seeing in The US. So overall when I think about the expansion of categories and the opportunity available, it feels similar to The US and in some cases might be even better.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. Shifting to commerce. So you’ve ramped the commerce platform over the past year. You just announced the acquisition of Seven Rooms. Can you talk a little bit about the broader strategy, merchant enablement, and the rationale for this deal, and how you expect to see that monetize over time?

Ravi Inukonda, CFO, DoorDash: Sure. Bunch of questions in there. So let me start with the overall strategy, right? When we started DoorDash, the fundamental thesis for us is we want to be a merchant services company. We want to help both grow as well as empower merchants.

The grow portion was where we started, which is our demand generation marketplace. That was the first product which we started. The Empower is we looked at merchants and say hey, how can we help merchants even more? What are the services we can provide to merchants? We started with logistics as I talked about.

Then we added our storefront business. So Seven Rooms is basically an extension of that strategy. What we were looking for is how do you help merchants manage their tables better? How do you help drive operational efficiency? Plus at the same time, how do you help merchants drive more sales and marketing in a closed loop system to consumers?

So Seven Rooms gave us an opportunity where we said you can market to consumers, you can get to know your guests better, you can bring them back to the restaurant more often. That software platform, combined with the distribution network that we have, where we have more than 500,000 restaurants, We have an established sales force so we can sell into the existing base. That was the powerful combination that we were attracted by.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Makes sense. So advertising, some stats from Q4. So more than 1,000 SMB restaurants, 83 of the top 100 restaurants in The U. And 21 of the top 25 CPG marketers in The U. S.

All advertised on Dash’s marketplace. So thinking about those buckets, how do you think about the biggest opportunity and where are you pushing hardest in advertising at the moment?

Ravi Inukonda, CFO, DoorDash: Sure. Think of it almost completely opposite. We think of it from a merchant perspective. We are not trying to think of it from our perspective. We are not trying to solve for sort of like a financial metric.

Ultimately what we want to provide is our advertising business, our merchant funded promotions business is just another part of our business to business services that we provide to merchants. Today merchants spend somewhere between 7% to 10% of their sales advertising. But they don’t really have sort of like an analytical way to spend those dollars. We think our solution can give them the analytics behind how to spend their dollars, drive a higher return on advertising spend. And for us, as long as the return on advertising spend is in a superior spot, we feel comfortable continuing to extend and grow our advertising business.

But just to give you a sense of where we are, Today, majority of the ad business, the revenue comes from restaurants, that too in The US. Very early on the international side, very early from a CPG perspective, and that largely reflects the size of the business that we have, the underlying GOV that we have.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. And thinking about long term ad penetration, is there anything structurally different to you versus your peers? And and where do you think that can go over time?

Ravi Inukonda, CFO, DoorDash: In terms of, like, financial?

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Just in terms of where the advertising penetration is, whether you think about it in terms of GMV, gross bookings, as it’s been a metric for some of the food delivery space. Is there anything structurally different? Maybe we think about different verticals, restaurants versus grocery.

Ravi Inukonda, CFO, DoorDash: Yeah, I often find it weird when peers or other companies come out and say, hey, here’s the long term target for ad as a percentage of GOV. Because to me, I’m like, the merchant is not thinking of it that way. The merchant is saying, just give me a better product which helps me drive more sales to the merchant. And as long as that happens, whether it’s in store or whether it’s online, I think we can continue to scale that business. When I look at the business, I mean I think of it in terms of a couple of different angles, right?

Is there anything technologically that is impeding us to growing the business? No. Is there demand on the platform? Absolutely. Is the retention of existing merchants on the ad platform continues to be good?

Great. So as long as those conditions exist and the constraints being consumer conversion is not impacted and return on advertising spend is good, we feel pretty good. We are always going to be very disciplined about growing that business because we don’t want to get to a point where either conversion or ROAS gets impacted. So what you’ll see from us is provide great product to the merchant but be very disciplined about scaling that business.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. Thinking about financials, capital allocation. So gross margin, you’ve seen a little bit of a tailwind from insurance over the past few quarters. How are you thinking about that going forward?

Ravi Inukonda, CFO, DoorDash: Sure. Yeah, we’ve done a ton of work around insurance over the last couple of I’m pretty happy with where it is. I think we’ve driven a ton of leverage on the insurance line. But as I think about it, from a percentage of GOV basis, would expect insurance to roughly be sort of where it is today. Okay.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And then capital allocation, you’ve just allocated a significant portion to M and A. How should you think about the buyback and the free cash flow generation from here? And maybe on that point, if you can talk a little bit about cash balance and minimum levels you might like to maintain.

Ravi Inukonda, CFO, DoorDash: Sure. I mean, again, roughly, I think I answered this on the call as well. Minimum working capital needed to operate the business is roughly about 1,000,000,000 So anything above that, we’ve always said, as long as it meets our IRR threshold and framework, we are happy to invest, whether it’s back in the business or share buyback or inorganic. But I think the fundamental rule has not changed. For us, the core strategy of capital allocation continues to be we are going to invest as long as there is a good long term IRR as well as long term free cash flow that we think that generates from the investment.

The business is cash flow generative. We have a healthy amount of cash. As I think about it from a share buyback perspective, again, we are always going to be opportunistic about it. We might be constrained in the short term, but as we think about longer term, our view on philosophy and buyback has not changed. As long as it presents a good opportunity for us from an IRR perspective, we are happy to do

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And given that we’ve spoken about the five different priorities, key focus areas, how are you thinking about different areas that are most exciting at the moment from a capital allocation standpoint? Is there anything that really stands out

Ravi Inukonda, CFO, DoorDash: to you? I mean, again, I mean, think we continue to find good opportunities, right? Restaurants is the largest, the most mature business that we have. But still, I mean, find great opportunities to continue to invest, right? Like we still don’t have all the selection that we want on the platform.

We continue to invest behind product, we continue to invest behind DashPass. Again as we think about investment, I think there’s still a lot of opportunity for us to grow users and order frequency on the marketplace side as well as when you think about it from a B2B commerce platform perspective. I think there’s still a lot of opportunity for us to scale the existing services and continue to add new services as well.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And maybe the point you mentioned on DashPass, is there anything different there that is different that you’ve seen in international markets so far? How is some of the learnings that you’ve picked up in The US? How can you take that into UK, broader Europe? Sure.

Ravi Inukonda, CFO, DoorDash: In The US, DashPass continues to do extremely well. In fact, when I look at the growth rate of DashPass in Q1, it accelerated slightly from Q4. The core reason being the product continues to get better. You have more categories, you have more opportunity, more benefits that we have created on the platform. So overall, DashPass continues to be very strong.

Retention on the platform is strong. The order frequency is obviously higher than people who are not subscribers. In the European markets, it’s behind in terms of launch because we launched our Vault Plus business roughly about two years ago. But when I look at the slope of the curve in terms of adoption, the slope of the curve is higher in some of the European markets compared to even in The US. And part of it is because we have all these learnings from The US that we’ve been able to transport and help our Vault team actually avoid some of the mistakes that we made as we started the DashPass business many years ago.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. It’s a tech conference, so we’ve not spoken about AI yet. Absolutely.

Ravi Inukonda, CFO, DoorDash: AI or autonomy. You haven’t asked any of both.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Exactly. Well, we’ll touch both of those. So AI, how are you guys leveraging it internally? There have been a few examples from presentations I’ve sat in today where companies have spoken about driving efficiency improvements across the internal product. We had Laurie Beer speak at the start of the day talking about 20%, thirty % efficiency gains that our own developers at JPMorgan are starting to drive.

How are you guys thinking about that?

Ravi Inukonda, CFO, DoorDash: Yeah, very similar. I mean, again, I think we have more than a dozen experiments, maybe even more internally within the company. And I think of it in terms of three broad buckets. On the far right you have internal areas, whether it’s analysts writing SQL queries to get data, a lot of that started to get replaced by some of the AI tools, developers writing code. Just like some of the other companies, are starting to see efficiency gains there where automated code generation is happening.

In the middle you have the classic use case around support where a lot of the workflows, sort of like you have the contextual workflows that are being generated by some of the AI tools. And on the consumer side, you have personalization, which is like hey, you share your account with somebody else or if you and your significant other have the app, it should look very different based on your preferences, based on your order history. We’re starting to see that drive conversion impact as well.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Okay, great. Autonomous, it’s obviously touching more of the ride hailing market at the moment than it is restaurant. But you guys have touched on some of the investments you’re making on a number of earnings calls. Maybe you can dig into that

Ravi Inukonda, CFO, DoorDash: a little bit and how you’re thinking about the evolution of that tech. Sure. I mean, we’ve been working on it for a few years. I mean, nothing major to announce, but we think there’s a real opportunity for us where a certain portion of the deliveries can be autonomous. We think of it in terms of two forms shared, both by land as well as by air.

I think we made a good amount of progress. We feel good about where this is headed. We’ve been very disciplined sort of about our investments in that area. But overall we think the technology is pretty promising and what we need is very different from sort of like ride sharing. It’s a different form factor.

It’s lower in terms of overall cost. We think there’s a good opportunity there where it could be unit economic beneficial for us in the long run.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: And regulation, it’s a moving target in lots of different jurisdictions, both in The US and internationally. Is there anything that stands out at the moment that we should be talking about?

Ravi Inukonda, CFO, DoorDash: Nothing really has changed. I mean, I think even almost since the IPO, mean, I think it’s the same sort of like few things that have happened, but nothing major to talk about. I think it feels like it’s a pretty good spot right now.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: Great. And we’ve got about a minute left. But as you’re thinking out over the course of the balance of this year, the next few years, is there anything that is particularly exciting that you’re focused on at the moment?

Ravi Inukonda, CFO, DoorDash: Sure. If you just take a step back and look at the journey of the business, right? I mean the core business continues to do really well. You have a business that’s continuing to grow. We’ve been through a variety of different demand cycles and the business has been very resilient.

The overall profit dollar production of the business continues to increase. We’re the only company to have gained share in restaurants. We are the largest in The US. New verticals, we feel like we’ve made a lot of progress over the last three or four years after sort of like a build cycle several years back. We’re going be number one in terms of order volume share.

You’re starting to see us drive majority of the growth in that industry now. Our international business continues to do well where that business is gross profit positive. And I think the two sort of announcements that we made, both Deliveroo and Seven Rooms, I think it’s a combination of a couple of things, right? We feel good about the core business. Both of these give opportunity for us to expand the surface area, to invest more, ultimately to drive more profit dollar production.

At the same time, we feel like we have the capacity and the bandwidth to be able to do that just given that the existing business continues to scale as well as grow quite nicely.

Jack Addison, JPMorgan US TMT Spec Sales, JPMorgan: It’s a great place to leave it. Ravi, thank you very much.

Ravi Inukonda, CFO, DoorDash: Thank you so much for having me.

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