DoorDash shares rise 6% premarket after Q3 results and Instacart deal

DoorDash Inc. (DASH) said in a filing on Oct. 29 that third-quarter revenue rose 34% from a year earlier to $4,616 million. The same day it agreed to buy Instacart for $65 per share.

Shares rose 6.3% in premarket trading as of 8:15 a.m. ET, from a regular-session close of $169.49.

The company reported results for the quarter ended Sept. 30. Total orders rose 28% to 993 million. Marketplace GOV, or the total dollar value of orders completed on its marketplaces, rose 36% to $33.9 billion.

Here's how the company did:

• Revenue: $4,616 million vs. $3,446 million a year earlier
• GAAP diluted EPS: $1.06 vs. $0.55 a year earlier
• Net income attributable to common stockholders: $466 million vs. $244 million a year earlier
• Adjusted EBITDA: $1,060 million vs. $754 million a year earlier

Excluding Deliveroo, which the company acquired last year, Total Orders rose 17% and revenue rose 23%. Deliveroo contributed $365 million of revenue in the quarter. Beginning in the fourth quarter, the company intends to stop disclosing results excluding Deliveroo.

Revenue has risen in each of the last three quarters, from $3.45 billion to $4.45 billion, according to its SEC filings.

Instacart deal terms

DoorDash will acquire Instacart for $65 per share, an equity value of about $17 billion. Instacart stockholders may elect to receive cash, DoorDash common stock, or a mix of $48.75 in cash and 0.0843 DoorDash shares for each Instacart share. Stock is capped at 25% of the aggregate consideration, and proration applies.

The price represents a 26% premium to Instacart's closing price on Oct. 22, the last trading day before media reports about a possible transaction.

DoorDash expects to fund the cash portion with cash on hand and debt. It has a financing commitment from JPMorgan Chase Bank, N.A. for a 364-day senior unsecured bridge loan facility. The transaction is not subject to a financing condition, and the company is targeting a capital structure that maintains investment-grade ratings.

The company expects the deal to close at the end of 2027 or in the first half of 2028. Closing requires approval by Instacart stockholders, expiration or termination of the Hart-Scott-Rodino waiting period, and other regulatory approvals, including in Canada and Israel. Stockholders holding about 19% of Instacart's outstanding shares have agreed to vote in favor.

The company sees a multi-year path to $500 million or more of annual synergies, net of investments. It expects to invest more than 100% of total synergies in the first year after close, with positive net synergies in year two and beyond.

2026 guidance

The company now expects 2026 stock-based compensation expense of approximately $1.2 billion. Its Aug. 5 range was $1.2 billion to $1.3 billion.

It expects 2026 depreciation and amortization expense of approximately $1.2 billion, including about $450 million of amortization of acquired intangible assets. Its Aug. 5 range was $1.1 billion to $1.2 billion.

The company kept its estimate that year-end timing for merchant payments will reduce 2026 Free Cash Flow by $700 million to $800 million, the same range it gave on Aug. 5.

Cash and buybacks

Net cash provided by operating activities was $994 million in the quarter. Free Cash Flow was $787 million, up from $723 million a year earlier.

The company repurchased 6.8 million Class A shares for $1.0 billion year to date through Oct. 28 under its February 2025 authorization of up to $5.0 billion. About $4.0 billion remains under that authorization, and the company said it may or may not repurchase any portion of it.

The company will hold a conference call on Oct. 29 at 8:30 a.m. ET.