DoorDash, Inc.

Hello, everyone. Thank you for joining us and welcome to the DoorDash Q2 2026 earnings call. After today's opening statement, we will host a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. To withdraw your question, press star one again. I will now hand the call over to Weston Twigg. Please go ahead.

Thanks, Connor. Good afternoon, everyone, and thanks for joining us for our Q2 2026 earnings call. I'm pleased to be joined today by co-founder, chair, and CEO, Tony Xu, and CFO, Ravi Inukonda. We'll be making forward-looking statements during today's call, including, without limitation, our expectations for our business, financial position, operating performance, profitability, our guidance, strategies, capital allocation approach, and broader economic environment. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those described. Many of these uncertainties are described in our SEP findings, including our most recent ones, 10-K and 10-Q. You should not rely on forward-looking statements as predictions of future events or performance. We disclaim any obligation to update any forward-looking statements except as required by law. During this call, we will discuss certain non-GAAP financial measures. Such non-GAAP measures to the most directly comparable GAAP financial measures may be found in our earnings release, which is available on our investor relations website.

in addition to our gap results and they're not intended to be a substitute for our website.

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Operator, I'll pass it back to you and you can take our first question.

Question and answer session. Please limit yourself to one question. And again,

To withdraw your question, press star 1 again. We also ask that you pick up your handset when asking a question, and if you're muted, please call the Q&A roster.

Your line is open. Please go ahead. Grocery business, as you talked about improving the unit economic on the platforms who are paying, your platform specifically, who are paying effectively to drive demand and how well they could work with DoorDash. I was wondering if that's Thank you. Hey, Michael. It's Tony.

I can start and feel free to chime in, Ravi. Our grocery business, it's the fast growing part of our marketplace business, and we have very healthy relationships. In terms of the economic relationships, I'm not going to really comment about any in the market for them. And you are their source of growth.

Put a different way, we might be 100% of the growth that they see in terms of their actual business.

You certainly have opportunities to grow your business with them. as well as improve your relationships with them. I mean, I think if you look at our business as a whole, I think one of the things you see from this quarter and frankly, I think many of the time periods leading up to now is that there are many sources of improving economics. We have improving unit economics across all of our categories. You have improving unit economics in our restaurants business too. You have improving unit economics in our different geographies in which we operate. You have increasing adoption of our DashPass program as well as accelerating growth in our ads business. And I think when you add all of that in, we have a business in which there are many levers in order to make great investments. Ultimately, we're here always seeking the next best investment.

It doesn't mean that we always make all of the work that we're doing in grocery, which we think there's a long runway.

Mike, just to add, right, like, look, I mean, if you take a step back and think about our overall grocery business as well as new verticals, we talked about the fact that we became to, when you look at the underlying growth in MAUs, which is the number of frequencies growing, we talked about the fact in the letter that basket sizes are growing. If you look at our historic cohorts, consumers are using us for more use cases, which is We expect our overall new vertical business to be gross profit positive. We think about, you know, retention, order frequency, as well as underlying improvement in unit economics, and they're all headed in the right direction for us.

The next is open. Please go ahead.

Thanks. I'll ask a question about Deliveroo. You've had now three-quarters in the role of kind of accelerating growth, I think, in revenue. So, just peel that back a little bit. What you've been able to pull, what you've been able to change in order to deliver that better performance, and it's a little hard to tell, but is it also showing

Thank you very much.

What I would say on Deliveroo is it really is a story that probably started way back in 2019. A large acquisition overseas, which was with Volt. And we've learned a ton and we've learned a lot in terms of how Volt has operated in different geographies across Europe, as well as how to integrate the lessons that we've learned as well. Geographies. So what you're seeing in Deliveroo, I agree with you, Mark, is and that's super exciting because I think, A, it's validation that our integration work These marketplace businesses around the world do translate. You know, we're just seeing, you know, growth in all of our big international markets. And this doesn't even include, you know, the building a single tech stack. So, you know, as that work kind of comes We expect to see even more benefits as time goes on.

And Mark, just to put a final point, when you look at the actual performance of description growth, actually when you look at it on a year-over-year basis, it's been the highest that we've seen. Part of your question, we've increased the unit economics as well, but the way in which we're operating the business is very similar, right? We're finding great opportunities to drive investment

So we're going to continue to invest back in the business, and my expectation is we'll continue to drive... ...class letter. The next question is... ...is now open. Please go ahead. Hi, thanks for taking my...

I guess broadly there's a common perception that international might be lower quality growth because maybe you're not number one every consolidated today. I would love your perspective on that over the longer term earnings power or quality of growth out of these international markets relative to the domestic business. and many others.

Yeah, hey Nikhil, it's Tony. I can start. I think there are a couple of different questions that you're asking. My aspiration is to be the global leader in local commerce. portfolio products in order to serve those audiences. But like you said, it's a game that is played locally. One of the points you raise is the right one where market position and kind of your economic profile. And that's because it is a minimum viable scale. you know the vast majority of our international business is we are the leader or we are a very strong number two and we're gaining share in all of the markets you know some of these markets include places Israel, Canada I mean I can keep going but we a follow-on to the previous question where, you know, Ravi was talking about how we're making improvements, you know, fundamentally to the actual core propositions to all the options. Better prices, better quality of delivery. And so whenever I see that, and I also see the opportunity for the runway to bring our portfolio of B2B products, which and so on. So, I mean, I just think the potential is very, very big.

When I look at the portfolio excluding Google, we are growing, emails are growing, the order frequency is growing. World Plus, in fact, our subscription program and subscriber growth. At the same point, it's not just purely about growth for us, right? When you look at whether it's gross profit or contribution, both of them have continued to improve on a year-over-year basis.

Eric, can we take the next question? The next question is from Deepak Mafanan from Canterbury. Thanks for taking the question.

Great, thank you.

Tony, last month, you displayed AI spend into outcomes somewhat closer to the business metrics now.

Can you talk about where you're seeing this attribution clearly now and how we should broadly think about AI spend at Dash over the next We want to make sure that our, you know, any technology

that it's actually rooted in delivering a better customer experience. Because if it's not, I'm not exactly sure. I don't think it makes sense to just play with the technology for the tech. For example, one of the more recent products we launched was called DoorDash Ask, which is an ordering agent that helps customers discover but that are new to them that helps them build a grocery cart in under two minutes using an increasingly larger and more diversified marketplace. That's one example. Building catalogs for retailers or menus around all of the different SKUs and items so that we can actually onboard a merchant faster in order to get improvements in routing as well as those are some examples of how we actually have applied AI in a way that is actually meaningful in terms The thing that we've done is, you know, kind of with all things at DoorDash, we do it in order to be efficient, as we do about allowing some degree of inefficiency towards tools like Dashbench and other, you know, and the appropriate tools and give those tools intelligence required. And so I think those are some of the things in which kind of our approach in terms of how we've applied it towards AI or frankly any technology. It's why we're excited to keep going and lean in

allows us to bring real customer benefits.

Quite strong in the quarter if you look at it. In fact, growth accelerated from Q1 to Q2. A lot of the growth is coming from just... We added more number of DashPass subscribers in the last year compared to the DashPass, it was one of the highest that we've seen in the last couple years. A lot of that is the underlying product continuing to get better. A lot of that is the increased investment that we've made. They're continuing to engage higher than what we've seen before.

New.

Just seeing in restaurants. And what I would also say is if you think about Q2 of last year, it was unusually strong for us. So comping against what was a strong Q2 of last year. to aid the demand that we're seeing in the business as well as the underlying improvements in product.

The next question is from Dominic Ball of Rothschilds and Co. Redburn.

Yeah, hey, thank you for the question. Interesting conversation. well known that Doordash has been testing its POS product in a few markets in the US with both SMBs and what products and features are kind of resonating. Then how do we think about a potential more broader commercial launch going forward? Thanks, guys.

to every local business that probably is pretty give every business the same tools that we built for ourselves so that they can grow their digital business. So if you think about what that looks like, at least three offerings today, right?

We have our marketplace is,

of restaurants and retailers. In fact, that business serves over 150,000 businesses. And then more recently, we've introduced products. Products include going out as well as reservations. And then on the business side, it includes And, you know, when I think about what the customers build their relationships with the local businesses and ideally forge, you know, and the reason why we can do this is because we have the data sets. to allow us to actually drive this engagement. For example, a customer may start by ordering to sign up for a loyalty program on a merchant's first party channel. It makes sense both DoorDash and the merchant can incentivize the customer to go inside the So when you think about the interaction effects here, all these businesses and, you know, for consumers, give them, you know, the most choice in terms of how they actually want to interact with all these businesses are really, really strong. And, you know, we think that this ecosystem is

The next question is from Jason Helfstein of Oppenheimer.

Is it possible to share the AOV for the most recent period in the gross free and retail? Thanks.

Sure. Maybe I can start with the question.

You know, I would say a few things about DoorDash.com.

and many more. Thank you. that actually allows you to, you know, put a different way, you know, DoorDash.org or any for that matter alone will not make autonomous deliveries a meaningful penetration, you know, for customers.

I mean, at the end of the day, you have to solve

The loading problem, any level of meaningful penetration for customers. I mean, at the end of the day, you have to solve very challenging operational problems in the physical world. You have to solve the loading problem at the merchant. You have to estimate merchant prep times in the case of restaurants or inventory levels in the case of retailers and grocery stores. You got to solve for difficult drop-off issues like, you know, perhaps a doorman inside of a high-rise building or, you know, a complicated gate entry in an apartment unit. These are all of the issues that we've encountered and are, you know, candidly like maybe one one-thousandth of the issues that we've encountered in building DoorDash DOT in our test market. And so, I think to get to the milestone that we have today with DOT, where we have meaningful scale in our test market has been a huge accomplishment by the team. And it gives us confidence that you can actually truly scale autonomous delivery if you both can master the operations and the technology. And that's why I think we're in the best position to do it because we run the network and we're also building the technology ourselves, which gives us the lowest level of detailed understanding of how to actually make this happen. and doesn't mean that, you know, we have to build everything. I mean, we actually, you know, whether it's by land or by air, we have a variety of partners that we interact with. And, you know, for everyone, we kind of solve all of the challenging operational problems for them. And we do that through our autonomous delivery platform. So, you know, for a merchant, you can take your existing DoorDash integration and you get access to any and all AVs. And for customers, you're going to actually one day get the benefit of these technologies. And with respect to the cost profile, we're very excited by what we see. I mean, it's exponential progress. But I think that the first milestone for us has really been, can you actually commercialize this in a way that you've seen certain robot taxi providers like Waymo actually do it with rideshare? We've been able to now do it with delivery.

Hey Jason, it's Ravi. On the second point, let me start with what we're seeing in the business. As we continue to operate and expand our new verticals in grocery business, what you're seeing is as the product is getting better, the basket sizes are increasing. This is what we had originally expected, which is as we add more selection, as the quality of the product continues to get better, you would have customers use us for more use cases, which will ultimately drive the basket sizes to be higher. We're seeing that in older cohorts. We're seeing that in newer cohorts. which is visible overall in the business as well. But let me actually take a step back and walk you through what our thesis was and why we put the second chart in the letter. Look, our core thesis was twofold. One is we knew that as customers or consumers habituate on the platform, they will spend more with us. They'll spend more with us on the restaurant business. They'll adopt newer categories. They'll spend more with us on the new vertical business. The example that we took in that chart was one of our older cohorts which is largely representative actually of the other cohorts that we see in the business where consumer spend on restaurants is increasing, consumer spend on new verticals is increasing, and at the same time, DashPass penetration is increasing. And if you think about it, right, this is almost like a self-reinforcing loop where the product gets better, consumers adopt and habituate to DashPass. As they adopt DashPass, they continue to use the product more, which ultimately leads to more growth as well as more profit dollars in the system. This has largely been the focus for us. and that's largely what you're seeing in the underlying cohort. And we're very pleased with the performance of that in the underlying business.

The next question is from Shweta Kajuria of Wolf Research. Your line is now open. Please go ahead.

Thank you for taking my questions. Let me try two, please. First is on the Dash Mart fulfillment services. Since your launch and since working with a handful of partners, I understand, What have you learned so far that you could potentially quantify or some sort of tangible learnings that you could share, whether it is on the magnitude of customer experience improvement or something else? And then what metrics do you look at to be able to make that decision to scale Dash Mart fulfillment services? And then the second question is just overall EBITDA growth, where now we are in the back half of this year. and in the light of investments this year, but more importantly, as we think about balancing growth and top line growth and EBITDA growth, Ravi, how are you thinking about that as we think about the demand trends that you see right now and balancing growth with profitability? Thanks a lot.

Yeah, I can start by answering about Dashmark fulfillment services. say the obvious. We want every local business to be successful in their local communities. And that's true in every category, from restaurants to grocery to retail. And one of the things that we learned five years ago when we launched our grocery business, even though it's going so well and we're helping lots of grocers compete, is that there's this structural challenge with grocery delivery where Grocers don't know their inventory. In some ways, it's almost impossible for a whole host of reasons, one of which is because consumers come in and they move things around. And so it's a very difficult proposition then to offer customers a use case where you're asking them to pay a premium for delivery, but they don't get exactly what they ordered. So, you know, our solution to this is Dashmark Fulfillment Services, where we are managing, you know, warehouses where we control the inventory and sell exactly what's in stock so that we can actually offer near perfect accuracy and give customers the selection that they want from any place inside the city and also very, very quickly. And so in terms of what we've seen so far since our announcement last fall and the launch that we've had with several partners is we're seeing lots of incremental demand because these warehouses are running near 24-7. If you compare that to traditional store operating hours, that's a dramatic increase in TAM as well as you know really just solving the needs of customers because customers sometimes don't you know get freed up until maybe after store closing hours before they can think about you know the next day or planning their groceries or their shopping needs so we're seeing lots of incremental demand and we're also seeing you know 10 times better error rates because you know we're we're running the inventory and as a result you know we're selling customers exactly The customers are getting exactly what they ordered and we're selling them exactly what's actually in stock. And so, you know, all the signs right now are really positive, you know, for us to scale Dash Mart fulfillment services. But look, this is complicated. I mean, this is building physical infrastructure. You're obviously adding technology to it by managing the inventory and obviously running the entire fulfillment. But you can imagine a world in which you know these warehouses can power all of the needs inside of a city and you can what you can really do when you do something like that is you can really unlock the amount of selection available to customers because today I would say DoorDash is delivering probably one tenth in most cities you know the available selection in terms of you know retail and grocery and the like and so we can actually build this capability and you know do it in concert with all of the great retail and grocery selection inside of the city. I think customers get the best product. They get all the selections that they want at perfect quality very quickly.

I'm sure that your second question around, look, I mean, trying to balance both growth as well as profitability, right? You had asked about the demand trends. Look, when I look at the underlying business, the demand trends continue to be quite strong. I mean, as you know, we focus and spend a lot of our time on cohorts. You know, MAUs, when I look across the board, they have at all-time highs. I talked about the fact that both domestically and internationally, those are one of our best quarters in the sense that this subscription continues to be at record highs. Restaurant growth accelerated. The group continues to do quite well. Overall, when I look at the underlying improvements in the product, that's driving the improvements that you're seeing both from retention as well as order frequency. At the same point, I mean, look, I mean, the quarter was very strong from an underlying profitability perspective as well. A lot of that is because the underlying unit economics continue to improve. For us, the philosophy has always been the same, right? We're consistently trying to improve efficiency. There's many sources across the board, whether it's sales and marketing, fixed costs, you know, up and down the P&L. And our goal is to consistently reinvest back in the business. Look, we talked about the fact that we're investing, you know, back into the business and building products, some of which we've talked about earlier on the call, whether it's autonomy, unification of the global tech stack, or investing back in merchant services. All of those are going well. they're all going on budget and on plan according to what I'd estimated a couple of quarters ago. These will increase the surface area. Ultimately, the goal for us is to continue to drive both growth as well as profit dollars. As long as we make the product better, what we're seeing in the business is we're able to do both. This is how we think about balancing both growth as well as profit dollar production in our business.

The next question is from Josh Beck of Raymond James. Your line is now open. Please go ahead.

Thanks for taking the question. I have maybe a product-oriented question. So on DOT getting to high single digit within a market by the end of the year, could you give us maybe like some characteristics? Is this because it's maybe more of a longer route, suburb type of market? And if you were to maybe add in all of the different and many more. The AI assistant, obviously lots of attractive characteristics, discovery, basket, et cetera. I'm curious if there's been other observations with respect to better frequency of these customers. I'm curious on maybe what you have to say about ad monetization. It seems like maybe time spent could be less, but conversion could be better. So I'm just curious on those two topics. Thank you.

All right. I think he had like maybe seven or eight questions in there, Josh, but I'll do my best. Look, on DoorDash Dot, it is a representative DoorDash market. You know, we're testing in Phoenix. And so and we're testing it with real scale now, which is like it's a real accomplishment when you think about, you know, these are not demos. These are not prototypes. There are no fixed routes. This is real life, and this is real life for tens of thousands of customers that are receiving real deliveries. And so that's very exciting. It's also very challenging. I mentioned maybe five or six issues that might be literally one one-thousandth the number of issues that you have to solve to actually have a chance at making autonomous deliveries actually happen. and that's true whether you're doing it by land and it's also true whether you're doing it by air. I mean, you know, we've seen this with DoorDash Air as well in addition to, you know, all the partners that, you know, we test with and bring our scale to. And so, you know, what I would say is what's going to determine, you know, the ceiling or the penetration of autonomous delivery is whether or not you can master both the operations and the technology. and, you know, I believe we're best positioned to do that because we're actually doing both in-house. And so we are getting to the lowest level of detail, you know, chopping down the very heavy wood of every issue that exists in the real world, that exists in every single restaurant, retailer, on the road. I mean, Dodge travels road, sidewalk and bike lane. It's the only vehicle in the world to do that autonomously. And There's a lot of challenges when you actually try to take on that multimodality. And one of the interesting things, perhaps the most interesting thing of what we're building with autonomy is this autonomous delivery platform. You can think of this as the brain that actually makes it all happen, that deciphers which vehicles go to which orders, that decides whether you have a mixed route where you have human dashers as part of the legs of the journey and autonomous vehicles on other parts of the journey. That looks into the configuration of the package size and the package design and the package weight. And there's a lot of complexity, but all of that gets reduced and kind of goes and disappears because we kind of handle it through our autonomous delivery platform so that merchants get the same integration that they have with DoorDash today. They don't have to change a single thing about their workflow, and customers just get access to the benefits of autonomous delivery, which will be in the future speed, cost, and more selection. And so I think that's going to be really, really, really exciting. And again, it's really going to be the execution that determines You know, the ceiling. I think we're best suited for that execution. You know, I think your second question on the AI assistant. I mean, the short answer is, of course, if you're whenever you're making whenever you're reducing friction in a product, you get more usage. You know, so if we're making it easier to build a grocery cart, you get more grocery carts. and you get bigger grocery carts and it doesn't change at all the ads profile or anything else. If anything, you actually get just more incremental orders and more incremental opportunities because people order more often. The same thing is true about ordering restaurants. If you now discover that there's something slightly healthier or faster or cheaper or just better or different from what you typically order, then you tend to order more often and possibly for more use cases. We eat 20 to 25 times a week and DoorDash only touches a fraction of that. And that is really the runway we have. When I think about the number of meal occasions and shopping needs on top of that, it's north of 100 per month. And so we have a lot of shots on goal that we can go capture. And if we just reduce the friction of actually ordering and then master and continue to master the operations of fulfillment, all of the metrics will go in the right direction.

The next question is from Yusuf Squali of Truist Securities. Your line is now open. Please go ahead.

Awesome. Thank you so much. So guys, I just want to double click on the margin question again. Can you Ravi, can you maybe just talk about the drivers for the material beats in adjusted EBITDA in Q2? It came quite a bit outside of the guidance range. More recently, you guys have been guiding to, at some point, hit somewhere in the midpoint. This one is dramatically higher. Were there any investments that got pushed back into Q3 and then Q4? And then are we still tracking to show higher year-on-year adjusted EBITDA margin for 2026 ex-deliveroo? Thank you.

Hey, Yusuf. Yeah, let me take that. Like, look, at the highest level, what I would say is the core restaurant business continues to perform on all cylinders. Growth, like I said on Deepak's question, right? Like, growth accelerated, unit economics continue to improve. New verticals growing much faster than a restaurant business, as well as, you know, it's on track to being gross profit positive by the end of the year. International continues to do well. We've talked about some of the strength that you're seeing in Deliveroo, as well as the beat on unit economics there. More specifically, what we saw in the quarter was the unit economic improvement came in ahead of our expectations, specifically in a couple of areas. Ads was one of them, subtotal was the other one, where in the second half of the quarter, those unit economics came in slightly ahead of what we had expected. In addition, RU beat our own internal volume expectations. RU is contribution profit positive. That led to some of the upside that you're seeing in the business. But look, I mean, more broadly, what I would say is Our philosophy in how we operate the business, that is not changing. Look, it's a very tightly managed business with a lot of levers that we control up and down the P&L. What we're consistently trying to do is try to find sources of efficiency. Like I said earlier, there's many sources of efficiency that we work on and take those and reinvest that back in the business. We're not trying to optimize the last dollar from one quarter to the next. Look, our focus has always been on how do you build a large durable business over time while continuing to increase the overall profit dollar production. To your second point, look, I mean, our focus has always been on landing inside the range. And if you're thinking about the second half from a modeling perspective, I would expect us to land inside the range of the guidance that we've given in Q3. There are going to be times like in Q2 where the EBITDA beat comes in later in the quarter. In those times, we just don't have enough time to reinvest back in the business, especially at the levels of efficiency that we desire. Q2 was one of those quarters where we were happy to drop it to the bottom line.

The next question is from Ross Sandler of Barclays. Your line is now open. Please go ahead.

Thanks, guys. Just a quick follow-up on the AV, and then I had a question about the charts in the letter. So Tony, I think you have a few hundred robots in Phoenix. How quickly is the plan to kind of bring this to other cities? That's the first question. And then on those charts, we love the DoorDash charts, but I'm guessing if Uber were to put together their sub-penetration relative to gross profit, it would probably look kind of the same for their leading markets. So are there examples of like cities or countries that you are kind of demonstrating the same trend as the US, but you've either come from behind or you've kind of come like head to head and overtaken one of your competitors on DashPass or Volt penetration for subscribers. Thanks a lot.

Sure, I can start on any question. Yeah, I mean, we're very excited about what's happening in Phoenix. But like, as I mentioned, I mean, there's a lot we got to go figure out. And, you know, I'm a big believer that you really have to nail something before you scale it, especially in the area of autonomy where, you know, you're really solving like, you know, the problems of like six separate individual companies almost. and you kind of have to be great at all. And it's this tightly orchestration again between the operations and the technology. I can't stress that enough because that is the name of the game. I think just doing one or the other is not going to get it done. And so there's a lot of work to be done. We are in parallel, of course, securing permits because we work with cities to actually unlock a lot of this. and, you know, we do have, you know, plans to expand. We'll share, you know, certainly more as time comes, but we thought that'd be helpful to offer just, you know, one milestone that we've, you know, accomplished and are excited about. But look, the road ahead for AV is very exciting, but It's going to take time, and mostly it's going to take great execution between the operations and the technology, and that's what we're most excited about.

Hey, Ross, on your second point, let me take a step back and talk about subscription more broadly. I mean, if you think about subscription, it's been a key area of focus for us for the past couple of years. Subscription continues to do well. Whether it's subscribers in the U.S. or international, the growth rate are some of the highest that we've seen in the last couple of years. and the whole thesis for us was as DashPass penetration continues to increase, overall gross profit per mile continues to increase. And when I look at the penetration levels, we're still very, very early. We're seeing similar behavior in the international markets compared to what we see in the U.S., albeit some of the international countries are slightly behind because we launched subscriptions slightly later than what we did in the U.S. And for specific examples, right, I'm going to talk about some of the examples on Dilibu. Look, if you're thinking about the U.K. market, we are gaining share. We're one of the fastest growing in that market. We're accelerating growth. We're accelerating paid subscriber growth, volume growth compared to what we've seen in the last couple of years. Even outside of Deliveroo, when you look at some of the countries that we operate in both, in majority of the countries that we operate, we're continuing to gain share. And the key thing for us is we're not just looking at share gains. We're looking at what the order rate improvements are. When you look at either the three months or the six months, we have continued to improve order rates. At the same point, across both Deliveroo as well as Bolt, It's been a way for us to drive efficient growth, where when you look at the unit economics, either on year-over-year basis or over the last couple years, we've done a pretty good job of improving that. Net-net, I mean, look, you know, we've talked about some of the countries before, right, whether it's UK, you know, Israel, or some of the other markets. We're continuing to do really well in terms of overall share gain, as well as the underlying improvements in cohort metrics.

The next question is from the line of Brian Novak with Morgan Stanley. Your line is now open. Please go ahead.

Hey, guys. Hey, guys. Excuse me. Thanks for taking my question. I want to ask one about the global tech stack and sort of the unification of the global tech stack. So now that you've got the tech stack sort of built as of the spring and you've been testing a lot of modules and new capabilities, can you give us some examples where you're seeing early signal with actual quantifiable benefits of the new modules that give you confidence you're going to get real return and ROIC on these investments as we go into 2027. Sure.

Yeah. Hey, Brian. Yeah, I mean, I would say we're still building the way you build these single tech stacks. It's not like I mean, the better analogy is not like, you know, it's not like a Lego project where there's like a finishing step, you know, in the instruction manual. It's more like you're constantly well, first, you have to like replace an engine while you're flying a plane that's you know growing in speed and climbing in an altitude and then you're constantly making tweaks that's probably the more appropriate analogy but we're doing it and you know where are we seeing benefits I mean I mean a lot of places already I mean you're seeing you know conversion wins from improvements in search you're seeing wins in automation in terms of our customer support flows and by bringing things from one place that was more automated to another place that was less automated. I mean, the theme really is what we're trying to do and why there's a thesis for a return here is because you're taking the best of breed feature and literally offering it to all of our 41 markets. This is not like taking one stack and then just copying and pasting everything into all of the brands. It's actually literally taking the best of each and then putting it into a completely new engine. It's like building a new company. That's why it's really hard. Candidly, it's not something that you would do if you did not believe more in the future than you did in the past. and that doesn't even take into account the velocity benefits after you complete the project where if you were to ship once from an infrastructure perspective that it actually gets shipped everywhere.

The next question comes to the line of Ronald Josie of Citigroup. Your line is now open. Please go ahead.

Great, thanks for taking the questions. I wanted to go back to the gross profit and Dash Pass chart that we had in the in the letter here. And so some of the lines more recently are steepening for both, which is talking all the trends that we saw. So I'd love to hear more, maybe, Tony, on just the plans or strategies to continue adding value to the program and the push and pull, what that value does to overall gross profit. And then more recently, I think the company launched newer or greater fees for larger delivery radiuses to talk to us about the reasoning for those fees and the benefits. Thank you.

Yeah. Hey, Ron. Let me take a stab at both of those, right? Like, look, subscription continues to do well. Our case has always been as consumers habituate and we graduate them to DashPass, their overall value proposition from not just a gross profit, but order frequency as well as retention goes up. And the example that we put in the chart was, you know, largely a Jan 2021 cohort. And we wanted to use that because it was sufficiently old enough where you could actually see the trends also it's largely representative of what we see in the other cohorts in the rest of the you know portfolio as well where what we see is as consumers order more with us as they retain more they graduate to DashPass and as they graduate to DashPass they continue to spend more with us and we think that not just in the order of course but in some of the newer cohorts as well which is ultimately leading to some of the growth that you're seeing in DashPass right I talked about the fact that in US in DashPass Q2, the growth rate in terms of paid subscribers was one of the highest that we've seen probably in the last two years. We added more number of paid subscribers in the last year compared to the two prior years. A lot of that is because the underlying product continues to get better, right? Now, if you're on DashPass, you get to access retail, grocery, other categories, which ultimately drives more value to DashPass subscribers. The way we increase the value proposition of DashPass, to your question, is making the underlying product better, right? With more selection, making the quality of the product better, continuing to drive affordability. And when we do that, we see clear improvements in both adoption of DashPass as well as the engagement from a DashPass perspective. And your second point, look, I mean, if you're thinking about the new fee service that we talked about, you know, the last couple of weeks ago, look, it's largely a realignment of consumers, what they pay compared to the time and effort that Dashers put in a delivery. If you're thinking about it from like an impact to the P&L perspective, I wouldn't think of it that way based on what we've seen in the market so far. The fee is largely similar or slightly less actually for the vast majority of the orders. So I don't expect it to be a massive impact, especially in the markets that we've launched it so far.

The next question is from the line of Justin Post of Bank of America. Your line is now open. Please go ahead.

Thanks for my question. I just wondered if you can give us any agentic traffic update, if you're seeing any traffic from there. And then given your huge merchant scale, are there ways where you could really capitalize on that traffic as they roll out booking capabilities and maybe even lower your marketing costs? Thank you.

I think, Justin, I'll take that one and feel free to add, Ravi. I mean, what I'd say in short is, no, the volume is quite low, you know, I think from, you know, some of the agentic partners that we've been testing with. But it also isn't that surprising, I think, for a couple of reasons. You know, I think first, you know, I think especially for some of the larger platforms out there, you know, their core focus has been on the enterprise and much less, especially on coding agents and probably less on the agentic side. But the second thing is just structurally speaking, if you look at it from a consumer's perspective, consumers don't really care what you call this thing, whether you call it agentic flows and pre-agentic flows, post-agentic flows. They honestly just care about getting their burrito or their pair of Nikes or their stock of weekly groceries. That's what they care about. And at the end of the day, what that means is they care about the end-to-end experience, right? And so if you think about it, We're effectively the only place that can offer that, whether that starts by knowing where all the inventory sits, what's in stock, what's not in stock, obviously managing the logistics at both the merchant as well as a drop off. And then, of course, solving exception handling when things were to go awry, if there's the wrong item or the wrong promotion applied to an item. I think these are all the details you kind of have to get right if you want to do agentic commerce for our category. and that's just not something that, you know, I think a lot of people are doing, but we're kind of filling the void, right? It's why DoorDash launched DoorDash Ask, where we effectively are solving that. But we're still, you know, very open, very excited to test, you know, all sources of incremental traffic, which is what we believe, you know, can happen. You know, something I said probably five years ago is that in the business world, this is 2021, you know, I was forecasting that there'd be two big and many more. Thank you. to all these digital assistants, you know, when they kind of, you know, come around to focus on agenda commerce that, you know, we'll be, you know, willing partners and grow together.

The next question is from the line of Doug Anmus of JP Morgan. Your line is now open. Please go ahead.

Great. Thanks for taking the question. I know you don't manage for take rate, but just wanted to get a little bit more color just on net revenue margin and the pickup that you saw kind of in 2Q. Just trying to understand some of the drivers there in terms of how much might have been delivery, contribution versus advertising, and fee changes and how you think about that going forward. Thanks.

Hey, Doug. Let me take that one. Look, I mean, you're right. I mean, we're not operating the business towards take rate or net revenue margin percentage. our goal has been always to optimize for overall profit dollars and as you can see pretty strong quarter from that perspective as well as the Q3 guide look lots of moving parts within the take rate the Q1Q increase which is what I think you're referring to is largely from Dasher look Dasher costs are seasonal for us when you go from Q1 to Q2 Dasher costs are lower in Q2 that's what gave rise to sort of the tick up and take rate that you saw from Q1 to Q2 and if you're thinking about from a modeling perspective what I would expect you know for the rest of the year I would expect to slightly be in the similar range in Q3, so flattish from Q2 to Q3, and lower in Q4. Again, as a reminder, I mentioned this before, Q4 Dasher costs are higher for us. That'll impact take rates, so you should expect Q4 take rate to be slightly lower than where Q3 is. But net-net look, I mean, the goal for us is not to manage to a specific line in the P&L, especially the take rate percentage. Our goal is to invest flexibly up and down the P&L.

The next question is from the line of Tom Champion of Piper Sandler. Your line is now open. Please go ahead.

Good afternoon. Thanks for taking the question. Ravi, I'd just be curious about your big picture view on AI spending and the ROI that you're seeing. And I'm curious if it's impacted your future hiring plans at all. Thank you.

Sure. I mean, I think, let me start with you. I mean, not just purely about driving cost efficiency for us, right? Like we said earlier on the call, look, we are encouraging our teams to use AI across the board. For us, ultimately, the goal is how do you build better products for customers, which will ultimately drive, you know, both growth as well as overall profit dollars. Ask was one of the examples in which we're driving benefit to customers. We've done similar things on both merchant side. We were helping merchants onboard faster. On the Dasher side, we've built conversational bodies where Dashers, if they're stuck, they can actually chat with the agent to help themselves get unstuck. At the same point, look, we're seeing productivity in the cost board. Internally, we're using it in sales, accounting, marketing, finance as well. The goal for us has always been it's not just purely about encouraging the usage. How do you actually drive efficiency as well? We've taken a number of steps. We've built models where internally the tasks are routed to the right model depending on what the actual cost, quality, and efficiency is. We've put caps in place. We've also incorporated some of the AI budgets into Teams' existing budgets. Look, we are seeing gains from the usage of AI. The sharper question for us is how do you take the efficiency gains and reinvest that back in the business? Look, we are investing in building some large areas. We've talked about autonomy. We've talked about AI. We've talked about the unification of the tech stack. These are all areas where we think it's going to be strong long-term ROI for us. The goal for us is how do you take the efficiency gains, whether it's AI or any other part of the P&L, There are no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect.