Q2 2025 DoorDash Inc Earnings Call

Thank you for standing by, and welcome to the DoorDash Q2 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question, this time simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press star 1 again.

I would like to turn the call over to West wig. Please go ahead Wes.

Good afternoon everyone and thanks for joining us for a Q2 25 earnings call.

Uh, I'm pleased to be joined today by co-founder chair and CEO, Tony, Shu and CFO Robbie in the contest.

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 a broader economic environment.

For the looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those describes. Many of these uncertainties are described in our FCC filings, including our most recent form, 10K and 10 views,

You should not rely on our forward-looking statements as predictions of future events or performance.

We disclaim any obligations to update, any forward-looking statements except as required by law.

Was released, which is available on our investor relations website at IR. Doordash.com, these non-gaap measures should be considered in addition to our Gap results and are not intended to be a substitute for our Gap results.

Finally this call is being audio webcast in our investor relations website. An audio replay of this, call will be available on our website, shortly after the call at

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

Absolutely. We will now begin the question and answer session. If you would like to ask a question, if a press star followed by the number 1 on your telephone keypad,

And your first question comes from the line of sweat. Kejora with wolf research, please go ahead.

Okay. Thanks a lot for taking my questions. Let me

Give Me 2, please.

On the US.

Um, accelerating year-over-year. You continue to see strength in restaurants, so it sounds like the strength was driven by.

Uh, dash pass membership, growth frequency uptake and potentially some product improvements around personalization and maybe faster delivery. So, I guess my question is, could you perhaps point to, um, some specific examples around what you did on personalization and what specifically drove strength in membership growth and frequency? And then the second question is on Advertising Revenue. You've now exceeded a billion dollars in annualized Revenue, run, rate, and you got there fairly quickly. So both symbiosis, uh, acquisition. Could you please share your thoughts on how you're thinking about scaling the on platform and off-site ads opportunity?

As you see it in the Neo midterm. Thanks a lot.

Hey Tony. I'll I'll start and Robbie. Feel free to chime in. Um, you know, on the first question about the, um, accelerated growth at, you know, bigger scale. Look. A lot of these improvements in developments were the results of our team's work. Probably dating back, you know, a couple years ago. Um, you know, I've always believed that it's very, very difficult to make changes especially at our scale. Um, that can have material impact, you know, within a short, you know, time period whether it's the quarter or even the year and in many ways um you know that goes to the work that we do today which is, you know, the work that our teams are working on right now likely will have an impact on, you know, a quarter, you know, a few years into the future. Um, and I think if we're doing our work, right? That is always going to be the key to your door Dash. Where

The Northstar focus is always to make improvements first and foremost, to our products, um, to the selection that we offer of both stores and items to the affordability of those items and stores the quality of delivery, the timeliness the accuracy. Um, and and certainly the customer service, especially when we get things wrong and

I think that's been a consistent narrative, uh, that reflects a consistent, you know, execution, uh, at the company for, you know, the 12 years that we've been doing this and it remains to be the case today. So, you know, we've seen improvements across the board, um, in our various products that have achieved the results that you're seeing today. Um, you know, with respect to the second question on ads.

You're right, you know, um, at some point last year we did a cross um you know, billion dollars of Revenue run rate in the ads business uh making it the fastest in history to get there. Um and I mentioned all along that you know the ads business has been progressing really healthily. Um but the focus for the ads business, you know today and you know 3 years ago when we started the business and in the future will always remain the same which is we have to achieve the best consumer experience. Um and build the most successful Marketplace, which is what we'll enable us to build the most successful return on ads, spent products, or the most successful advertising business for retailers cpgs and restaurants. And that's that remains the focus with respect to you know, symbiosis and acquisition that we closed. You know, 1 of the you know developments we've always had is that we've always been privileged where there is more dollar.

We collect. We believe that we can be the best marketer. Um, you can almost think of it as we are the agent of choice, um, where we can do the best marketing, um, spend for each 1 of these merchants and advertisers. And, you know, a lot of times, you know, I think when you think about our relationship with everyone, we work with we are not just a delivery provider. Um, many times, you know, we are the growth engine or the growth button. Um both in terms of what we can bring incrementally from our Marketplace, as well as the know-how that we bring from our first party business. Um, in teaching these retailers and advertisers on how to build the most successful digital powerhouses in their own rights. And so you see that again here in the symbiosis, um, example, um, as part of our advertising business,

Thank you. I think you know 1 of the things that you mentioned was the acceleration of the ad business. I mean I would clarify, right? I would not read into the disclosure as as changing the way in which we are operating the ad business. We're operating the business with the same level of discipline. The 2 metrics are Merchants roas as well as consumer conversion. We think we are the best in class for both of those. The goal for us is always been to build a great Marketplace business and if we do that, we as business will scale and continue to grow but we are going with the same level of discipline as we've done before.

Thanks Tony. Thanks Robbie.

And your next question comes from the line of t pacmat with with Cantore fiscal DAC. Please go ahead.

Great. Um, thanks for taking the questions. Um, Tony, I wanted to ask an AI question. You know what, we're seeing, big improvements in Search and recommendation systems across a lot of consumer internet platforms. Basically using, you know, AI models with reasoning capabilities. You obviously have a very strong engineering team. That's on top of these Tech. Breakthroughs, can you talk about some of the ways? How Dash is planning to use these larger, AI models to, uh, both improve user experience and also find additional pockets of operational efficiencies, maybe say in the next 6 to 12 months,

Um, and then, uh, the second question, maybe for Ravi, you know, with all the supply growth and value prop improvements, that you've done with new verticals, how meaningfully is new verticals now contributing to, uh, kind of new customer growth to the platform. And also maybe talk a little bit about the cross-platform benefits for the US restaurant business from new customers acquired, through Grocery and perhaps convenience.

Thank you.

Sure. Hey debok um you know, on the first question AI I I'll start um,

Whenever you see a, you know, revolutionary technology, um, that seems to be improving by the hour. Um,

You kind of have to rethink your entire business.

And, you know, I think this is a thought that dawn on me probably 4 years ago. Um, when you started seeing kind of the beginnings of what, um, you know, these things can do because I, I I, I think that, in, in many ways, it's not just, um, a, a, a, a new technology. It's also a new way of how you attack different problems. Um, so there are a few areas in, in, in, in which, um, you know, we found, uh,

Uh, uh, a lot of fruit in in terms of how we thought about applying it. So, you know, the first is thinking about, you know, what should the

What should the consumer product actually look like, um, in a world where to your point, um, there there's a different way of doing everything from search to personalization to ranking, um, and and, and I would say that there's a lot of, um, different iterations that, you know, I, I think, uh, you'll see us take in terms of, um, shipping a, a, a, a version of the product, um, that will really. I think marry the best.

Of what the technology brings in a way that actually brings pragmatic, um, benefits to different use cases to the consumer.

The second area is, you know, a lot of our business happens in the physical world. Um it's not just the deliveries um whether it's the creation of inventory lists or um menus from restaurants or all the work that we do to onboard different merchants and retailers and advertisers

More efficient ways with higher quality and Fidelity. And the final way is, um,

and we see this most notably in our engineering teams is really, how do we becoming more productive organization? Um, if you, if we were to start this company, you know, from scratch in 2025 versus, you know, uh, getting our start back in 2013. Um, we see this a lot in coding, um, certainly where obviously probably not a surprise. When you were talking about large language models, when you're talking about domains where there are correct answers and um, easy ways to produce evaluations. That can tell you, whether you're on the right track or wrong track coding has been a natural use of productivity for door Dash now for a few years in a row. Um, and I think that's only going to increase. Um, and so, that should also be true though. In other functions, if you're starting, if you know, I were building door Dash from scratch. Today, we would have a very different approach, um, given all the tools available. But this is kind of like when door Dash started, 12 years ago, where you had, you know, the um, the real acceleration.

Of of Cloud Computing Services where door Dash no longer needed to manage data centers. Um, we can kind of you know, get easy access to AWS instances. Um, and kind of get up and running, this is kind of true today but just at the functional level. Um, instead of just the compute level where, you know, across every discipline inside the company, I think you can from first principles redirect.

Drive, how you would build a company from scratch and that's what we're thinking about.

Hey, debug it's Bobby. I'll talk about new verticals, right? I know your question was around ucx but let me take a, you know, step back and give you how we're thinking about overall new verticals and the performance of the business. I mean look, new verticals had a really strong quarter, the growing really fast growing much faster than our core restaurants business. In fact, you know, we grew share and I think you know, like we said last time our expectation is that we'll be volume share leaders within the next year, if you actually break that apart, we are seeing strength, both from new, as well as existing cohorts on the new cohorts today, the size of new cohorts, ordering from new verticals is a higher than same time. Last year, the engagement levels of mature cohorts, think of them as existing cohorts, the size of those cohorts is also larger than what we saw last year.

At the same time, these cohorts are engaging with us more, which means order frequency is continuing to increase.

So when you look at the underlying cohort performance it's very strong. Both users are growing out of frequencies growing Vivid all-time highs across both of those metrics.

The real question is, what's actually driving that growth, right? If you look at the performance of the business, we've increased the selection on the platform, quite considerably. The quality of the product is continued to get better. We've made the product more affordable, more dashpass users are ordering from more categories. Look, in Q4, you know, we talked about the fact that roughly about a quarter of our users order from New Vertical that number is continued to increase. All of these are signs pointing to cohorts getting value consumer.

Was getting value from the product and for us, the focus continues to be to improve the underlying value proposition. And as long as we continue to do that, we're confident that, you know, there's going to be a large business for us over time.

Awesome. Thank you so much.

And your next question comes from the line Branch Jose with CD Ron. Please go ahead.

Great. Thanks for taking the question. You know, I wanted to ask a little bit more of the letter or the press release talks quite a bit about cohort trends, particularly within DashPass members. Is it still, you know, continuing to have records? So talk to us a little bit more about how DashPass cohorts have been trending here. Maybe on the newer cohorts in the last year or two, are we seeing similar results? And then, as we think about sort of just the bigger picture, and I know we're still yet to close Deliveroo, are there any updated thoughts on the integration there? Thank you.

Yeah, Ron I think the first 1 on that as in uh, Tony if you could join me. Look, I mean that's based in a very, very solid quarter.

Look, I mean, we've been investing in dashpass 4 years, right? Ultimately, the thing that is driving growth for dashpass for us, is the underlying product continuing to get better. We're focused on adding more selection, we're focused on driving higher quality, we're making the product continue to be more affordable. There's more, you know, features and services available as a part of that.

Asking a couple of quarters, right? We've been investing in the product for several years now, the underlying product is getting better. That's what's driving the strength, both in dashpass, as well as the underlying cohorts

And Ron. It's Tony. I think your second question is about deliveroo. Um, you know, probably obviously, there's not much I can say about it, um, besides the fact that we, we anticipate closing on, you know, the timeline we had communicated, which is at some point in Q4, um, it's obviously still subject to regulatory review. Um, but look with any acquisition, I mean, we're going to run, um, the, the, the company should it, should it closed, um, in the way that we run anything at door Dash, which is, you know, first and foremost, we have to build an investment, the best, um, product experience. And if we can do that and improve, you know, the order rates as well as improve the unity comics, where we see efficiency gaps. Those are the, um, you know, Tools in which we can use to reinvest back into each 1 of the audiences.

Um you know again our investment philosophy has always been 1 of maximizing long-term uh margin dollars. Not you know short-term uh unit margins and that will continue to be the focus that we take um you know to deliver a new project, should it closed? Um and uh any other project at door Dash

And your next question comes from the line of nickel devnani with Bernstein nickel. Please go ahead.

Hey, thank you for taking the question. Um, Tony, are you surprised by the ongoing strength in the size of new customer cohorts in the U.S.? I mean, it would seem like your audience in the U.S. is pretty large already, in the high tens of millions of people, which is a big number relative to U.S. households, but that doesn't seem to be affecting the funnel for new customer acquisition at all. So, when you step back and take a multi-year view, I mean, how durable do you think this trend is? And are you able to also break down how much growth this business gets from new customers versus pre-existing cohorts in a given year? Thank you.

Yeah. Hey Nicole. Um

No, I'm not surprised is, is is the short answer and, and, you know, I think I've met have said this in a few different calls before. Um, whether when we were discussing this during, you know, Co, um, if you can inflation in 21st of Koh or or Co reopenings in 22, where if you, um, you know, food is the most resilient, um, category and most sought-after category for convenient consumption.

if you just think about the fact that it is the um activity in which we engage with

You know, 3 times a day um 20 to 25 times a week. Um and more than 100 times a month and then now you include all of the shopping categories and use cases outside of food. Um, that door Dash has been pursuing for the last 5 years, I think. Um, you know, you get the setup for, you know, some of the, you know, markets and the Market expansion that you've seen. But look, I mean, a lot of the credit also goes to the fact that we're always trying to make our products better, right? So our product today in 25, um, is better than our product, you know, yesterday in 24, and our product. Next year will be better than our product this year.

so you have, you know, this

Big Market out there where we're single digit percentage of, that's, uh, when you look at the number of occasions that we actually, you know, capture today. We still lose the vast majority of those occasions to, you know, the pantry or a different form of consumption. And so, it tells me that we actually have a very large Runway ahead. So long, as we can, keep improving the product. And I think 1 of the things that tends to get underestimated, is how much you can actually keep improving the product. And my take on this is that there's a lot of room, you know? I

We've been fortunate to to serve um lots of customers today but when I look at the actual, you know, occasions that we capture today whether it's, you know, food consumption, retail consumption, and then when I look at this on a global basis and then when I also include, you know, shopping inside stores, not just ordering, you know, to the home or to the office. I think we still are very very very small and early and we can't underestimate just how much work we still have to left to do to satisfy increasing customer expectations.

Okay, to get into Robbie, look. I mean, I think the second part of your question was around like, hey, what's driving, the growth? Look, everything is important. Right? Size of new cohorts is important size of existing board is important, obviously, mathematically, the size of the existing quarts is larger than the new quarts. What we're seeing is the size of new cohorts is larger today than last year. Size of existing cohorts today is larger than last year, which points to 2 things write 1 is people are coming back more often, which means retention is increasing. All of that is being driven by the underlying improvements that we're making on the product. The second dimension, you should think about is order frequency again. Order of frequency, hit an all-time high. But again, we are a small fraction of the total number of usable movements just across restaurants.

Thanks for staying as promised. Until I mean, look, I mean, you know, talked about the fact that, you know, take rate was going to be higher in Q2, it was in line with our expectation. I mean, look, our business, there's, you know, factors that drive, you know, the take rate specifically in Q2 Dash or cost is seasonal for us. Right? Again, I'll read through it. We've talked about this before dash of costs are higher for us in q1, dash of costs are higher in Q4. So, you're thinking about the model Nickel in Q4 Dash, your costs are going to be higher. They're more reasonable in Q2 and Q3. So as we came into Q2, we saw benefit from dash of cost to, we are driving improvements in the underlying product, especially quality, which gave us benefit in terms of credits and refunds the third Factor. Was, that is becoming a larger portion. So, if you put all that together, that's what drove the increase in decorated in Q2. Now, if you're thinking about the rest of the year, right, nickel, I would think that H2 the second app take rate is going to be higher than the first half take rate, which is taking a step back. I mean, look, we are not optimizing the business towards the specific,

Perfect. Take rate.

Let alone a specific day rate within a specific quarter.

Our goals has been to focus on overall profit dollars. Our goal is to invest flexibly up and down the p&l. That's actually what's driving the strength that you're seeing in the business, right? We have the ability, we have the opportunity, when we see opportunities to invest, we double down. That's what's driving strength? Both in the top line as well as the bottom line.

Thank you, both.

And your next question comes from the line of Michael Martin with Market. Nate Anderson Michael. Please go ahead.

Hi. Thank you for the question. I think this is probably for Ravi. Uh, I want to ask some of the operating expenses you, you typically refer to them as fixed operating expenses. They're running a maybe a little bit hotter than some of us might have expected. Not that you should manage the business to our expectations, but we're living in a very interesting time where you hear a lot of the tech leaders talk about no headcount growth utilizing, um, AI within their corporate structure. So I was curious to how you think we should think about your needs for headcount growth going forward. Um, and then maybe it just, it could be helpful with kind of the fixed cost line item in the model. Thanks Robbie.

Yes, hey, Mike. Um, you know, I'll give you the model part first. And then talk about the philosophy. Look, you're just trying to model. I would say, Opex roughly. You should think about it as 2% of govt in that range which we've talked about for the past couple of quarters.

Uh, over long term. Like I mean, we think of that as, you know, any other part of the pnl goal is to drive, leverage goal is to drive efficiency.

Philosophically. I mean here's how I think about it, right? Like my look, we are investing in the business. We're still finding great Pockets, to continue to drive investment in the business, we're being very disciplined. We've added people both on the product and the engineering side and specific areas where the return on investment continues to be great.

Inside the business across the board in general. The way I think about this is the real cost of operating the business and goal is to generate leverage you know just like any other part of the pnl.

Really appreciate it.

The only thing I'd add to what Robbie said is you got to think of door Dash as a, you know, growing set of businesses, right? So it it, it door Dash 5 years ago was largely 1 product and, you know, operating in 1 Country restaurant delivery inside the United States in terms of what contributed to our financial results today. You know, we have 5 businesses, we have a business outside of the US with a business outside of us restaurant delivery. In all of our category expansion, we have a business with our Commerce platform, we have an ad business and we're working on a new businesses. And so, you know, I think 1 of the ways in which we've thought about this is, you know, where do we actually deploy our best people, and are they actually working on the right problems? And do we have the right number of people doing that? And, you know, a lot of our, you know, types can growth is really geared towards working on new problems that we see that we can solve for a long.

Commerce versus some of the existing ones, that's maybe a bit hard to see in the averages but

That's a bit more. What's happening under the hood?

And your next question comes from the line of Andrew Boone with Citizens. Andrew, please go ahead.

Thanks so much for taking the questions. Um, it sounded like Walt had a pretty good quarter in terms of frequency as well as um, unit economics. Can you guys just help unpack? What are the improvements? You guys are making in in that business and then I wanted to go back to frequency frequency continues to improve in terms of the US and was at all-time highs. Can you guys unpack that is, is that new verticals? Is that wider cohorts that you guys talked about maybe a year ago of people that order once a quarter and I ordered once a month, is there anything else you guys can shed in terms of light on why frequency it continues to just hit new highs? Thanks so much.

Yeah. Hey Andrew. It's Robbie, I'll take the first 1 on. Uh, International look. I mean international business, really? Strong quarter. When I think about it from a growth perspective, growth continues to be quite strong.

Coming from both growth in users as well as order frequency. When I look at the MBA use just for the international business, they have hit an all-time high, a lot of that is being driven by look, I mean, the underlying improvements are making the product, right? We've added more selection, we've added more categories. We have a new vertical business and international. That's also growing quite nicely uh, World Plus has been

Good addition to our overall portfolio, that's a subscription program internationally. We've launched that about 2 years ago, that continues to do quite well, and when I look at the slope of the World Plus curve, actually it's growing faster than dash pass at the same time. At the same time. You know, the improvements in both quality, as well as affordability. That's driving people to come back to us and order more. So order frequency has also hit an all-time high. So can I put all of that together, right? Like international business, not only is it growing but we gaining share across most of the countries that we operate in really proud of the progress that the team has made. And on the second point that would make is when I look at the unit economics. I mean I mentioned that gross profits positive for overall International that continues to be the case and even on a unit economic basis year over year, we've seen good amount of improvements the net net. I mean business is from both on the top as well as the bottom line for our overall International portfolio.

Yeah, Andrew. I'll I'll take the Tony. I'll take the second question on frequency, you know, the way I've always thought about this is, you know, how do we solve more and more customer problems and so that there's more than 1 way to win so to speak.

Where we can actually, you know, engage customers, you know. Um, that makes the most sense for them in terms of actually increasing their frequency like nope, no customer, put a different way. Think about door Dash's order frequency as a metric that they care about?

And you know the short answer is it is different for different customer groups. I I you know there is obviously the introduction of new categories and new use cases.

There is the introduction of dashpass and the growing benefits from dashpass.

And this is in general how we set up a lot of our product teams. So that, um, you know, a it's actually, you know, solving for that specific unique customer what it is, that actually, you know, solves a problem for them, so that we can grow a metric we care about. Um, and then, you know, finding more than 1 way. Ideally several dozen ways to win so that the growth is not only enduring but also geometric

Thank you.

And your next question comes from the line at PFS quality. We throw it yourself, please go ahead.

Uh, great. Thank you so much. So, 2 quick questions, 1 on 7 rooms. I think that acquisition closed in early or maybe mid June. I'm assuming Ravi that, that contribution was diminished. Um but um,

Maybe just talk about.

Um, Tony how how does it unlock new opportunities for you? If you have to dream the dream with kind of building. A SAS model around 7 rooms, can you maybe just share it? How you kind of see that evolving for you? And then in terms of profitability, for new verticals, can you maybe I in non restaurant? Can you just provide an update on how has it progressed as your growth is accelerated? Does it continue to improve on the margin or or are you holding the profitability?

Possibly flat to maximize Topline growth. Thank you.

Yeah. Hey Elsa, on the first question, on, on on 7206 and and an Earnest in the first quarter of 2017, where we shipped door, Dash drive. And you know the the the Dual mission of the company has always been on the 1. We want to help you grow and bring you incremental sales, that's the job of our Marketplace and on the other side, we want to empower you to do it on your own. So every physical business, small medium and large inside cities can win in the digital economy. And you know, we we now have built or shipped

2 of the most successful, you know, B2B products in our category with door Dash drive and storefront serving, you know, each serving hundreds of thousands of businesses.

And um, but it but it still is a very small.

Um, it solves a very small fraction of all the problems.

That a business needs to solve or even compared to the door Dash Marketplace. It's still a very small fraction of the product portfolio of what we've built for ourselves. And you know what products? Like 7 room, you know, bring is really a brings, a marketing component and um a data analytics component to understand, you know, all of

The different customers that engage with each 1 of these merchants in a Omni Channel 360 way. And obviously if you can marry um, you know, the best-in-class product, which we believe 7 rooms has built with the know-how as well as the data sets. The door Dash has access to. I think we can build something very remarkable as you know, a third, um, B2B product that will be very, very successful to, you know, many many Merchants both in restaurants and Beyond and so,

I, you know, this is less thinking about, you know, the business model. Although you're right, this this is a very different type of business, or B2B, um, Commerce platform which, you know, contributes to, you know, metrics like Revenue. But not not go. Um, but but really the way I think about it is what are the what are all the different problems we can solve. Because if you can solve all the different problems for these physical businesses, I think you're going to grow the GDP of the cities in which these businesses reside. And if you can grow the GDP of the Cities, then I think that's a win for everybody. And so that that continues to be um, you know, how we we've always thought about this and it's um, it's why we're really, really excited about, um, you know, closing the acquisition of 7 rooms.

Hey, YouTube 1-7, right? I mean, we are investing in the product, but, uh, from a bottom-line perspective, you're not going to notice the impact in the second half compared to the rest of the portfolio.

Uh to your second point on new verticals. I mean, look you know tactically speaking, right? When you purely think about it from a unit economics perspective.

Yes, unit economics, improved in our unit, New Vertical business. You're over here.

remember, it's like look, we have a

Social advantage.

Whenever we stand up, you know, newer categories.

I think very good about where we are on neuroeconomics, what we are focused on is driving scale in the business. Look, ultimately what we're trying to do is the same Playbook, right? We're trying to improve the inner economics, take that reinvest that back into the business to drive retention as well as Auto frequency because that ultimately drives scale. Scale drives efficiency in the business and you're seeing that come through in the business, right? When I talk about uh Q2 to debug question earlier, look, I mean cohort sizes are increasing both knew as well as existing for new verticals. What of frequencies growing at the same time. The unit economics are improving, we feel really good about the performance. Uh we feel uh business is scaling and we're going to continue to scale that business.

Awesome. Thank you both.

And your next question comes from the line of Jason H with the oppenheim Jason, please go ahead.

Thanks, I wanted to ask a bit more about dashpass um approve, the uh appreciate explosion of the quarter. So you know what has been basically the the kind of most effective method for growing dashpass users? Um does it differ by country and then talk about how some of the co marketing Partners have played into the dashpass expansion times?

yeah, hey Jason, it's Tony I'll take this 1 um

I I don't know which earnings call I made it said this before but look when it comes to dash pass you know the 80 in the 8020 of dash pass has always been first and foremost make the product more useful.

Make door Dash make vaults more useful and the more useful we can make it the more likely that a product like Mold Plus, or dash pass will actually get used. We don't want any leakage in the system. We want a product that, you know, people see, you know, a large multiple in terms of the benefits. They receive versus the amount, they have to pay for the subscription.

That's the 80 that continues to be the 80. There's No 1 thing that contributes to the 80. Um, and so it's mostly an obsession over focusing on every product detail and in an increasing the, the number of benefits. Um, the 20 though, um, to your point, um, in my opinion gets earned after you achieve the 80, which is if you can achieve the 80 and build the best-in-class products or the most useful ones. And I can't think of any other program. Um you know that can connect or or get get used as often if you can maximize the number of connections between consumers and businesses, um then you can achieve the 20 which is to build a successful partner ecosystem. We've been very lucky um in in in in that where um, you know starting in

In, um, 2018209, we partnered with Chase and we we haven't done that many of these, but we tend to go deep and partner with a few, um, like-minded Partners. Um, you know, more recently, we had, uh, we um, partnered with T-Mobile, um, where, uh, we get to go super deep in ways that benefit, you know, both audiences, um, from both companies. But you know, that, that really is the 20. Um, and it can only happen if we've actually built the most useful products to start with. And so that continues to be what the focus for both dashpass and volt plus are.

And your next question comes from the line of Michael McGovern with Bank of America Michael. Please go ahead.

Hey guys, thanks for taking my question. Uh, I have 2, maybe 1 for Tony and 1 for Robbie. Um, I'm curious on the cocoa robotics partnership for sidewalk robots. That I, I think occurred in April, any insight into how that launch has gone in LA and Chicago or any other new thoughts on robotic delivery methods. And then second, uh, it looks like the aov or basket size has continued to see this uptick in growth, for a couple quarters in a row. Now anything to call out there in terms of or or or just normal kind of growth in food costs. Thank you.

Yeah, hey Michael, I'll take the first question on on um robotics. Um

You know, our work in robotics started in 2017. Um, when, uh,

Passenger driving or Robo taxis. And that's because obviously in a, in a passenger context, the passenger can walk in and walk out of the car. Even if the drop off or pickup locations, aren't perfect, um, but in the case of delivery, uh, that's obviously not true and and in order to, you know, make sure that you can make

Um, autonomous delivery happen and Achieve uh uh its full potential. You kind of have to solve for the engine system and that's kind of, you know, probably the single biggest learning we've had. Um, and so, you know, we, uh, uh, We've made a few Partnerships, um, as, as noted in your question. Um, those those have gone great, um, you know, we we definitely see, um, you know, great potential in in, in uh, in in, in building that out. But, but we've also, you know, um, done our own work as well. And so, you know, we don't have any announcements to make at the time, um, but it's something that, you know, we've been studying, uh, and and working on, for, for several years now. And, um, it's something we're very excited about

Hey, Mike on the second point, I think you're probably looking at the over for the overall business. I mean look, uh, largely a reason of result of mixed shift. We are seeing uh, new verticals, become a larger portion of the business.

Even within new verticals. What we are seeing is an increase in basket sizes as users. You know, try to use us for more use cases. A lot of that is being driven by the underlying improvements. We've made in the product. Look we have more selection than ever before the underlying product continues to get better and more easier to use. That's what the driving the higher baskets in new verticals. But the overall, you know, aov and the total company level is largely a mix shift to new verticals.

Got it. Thanks so much.

No problem.

And your next question comes from the lineup pleased with the bank Lee. Please go ahead.

Great. Thanks so much for the time. Um, you know what, we appreciate it. Grocery seems to be a big priority today. Can you maybe update us on the state of your retail business and the indications on the pace of growth here? Have good economics or trends emerged? And how are you thinking about investing a bit more aggressively in this vertical? Then maybe, you know, an update on drone delivery. If you could, you know, some regulatory news in the U.S. is making it easier. You guys have Pro and have been running some tests in Europe as it relates to drone delivery. I guess, how do you see that product perhaps changing the unit economics of your business over time? And how do you think about maybe leveraging partners versus building yourself?

Yeah, hey Lee, it's Tony. Maybe I'll take both and feel free to add. Um, Robbie, you know, the first question on on retail. I mean, retail is a really exciting business for us. I mean, it's kind of it reminds me a bit of, you know, where it is today, kind of where grocery was for us, maybe in 2021, something like that. Um, we've uh, put a different way, we're just at the beginning and we're just scratching the surface. You know, I think the biggest, you know, learning that we've had on retail, is that

It is just very very different uh buying something that is non-perishable. Um and also very different based on each category in terms of, you know, the the skewed depth or the item coverage that you need to build a product that actually addresses. Real customer problems as well as, you know, everything from redoing the entire shopping experience to you know, the post checkout experience and all of that. And so all of this to say that it's um, you know, it's a sizable business drawing for us today growing super fast. Um, but it is so early in terms of where it is as a product. And so, you know, back to 1 of the comments I made earlier on this call, you know, I I think it tends to get underestimated. The, the number of things you can do to improve a product or the amount of time, it takes to actually do it. And then, once you do it, you know, the customer says, thank you and then they say, what's next?

And and so those expectations always go up. And so we got a long long, long ways to go in retail, we may be a leader or perhaps, even the leader in third party today in that category. But I would say, you know, as a product it is, um, it is a baby um, in terms of um, where we are, um,

Uh, like Google wing for example. Um, we've announced, you know other Partnerships as well and other parts of the world and we're very excited about those Partnerships. I I, the way, I think about how this plays out and, you know, we'll have more to share later, um, but it's that, you, you kind of have to think about all the different use cases and you got to solve for the Indian system.

Because it's not just the vehicle itself. In this case, whether you're talking about a drone or in the case earlier of the previous question about, you know, a land vehicle. Um, those products in themselves as complicated as they are actually only addresses maybe 20% of the complexity to actually deliver something that I think could be scalable economically viable. And most importantly actually solve customer problems in a way that, you know, human drivers cannot. And so, a lot of work needs to be done. We certainly have very strong points of view given that we've been working on this for about 8 years at this point and we look forward to sharing at some point in the future.

Okay, thank you.

And your next question comes from the line of Brian. Novak with Morgan Stanley Brian please go ahead.

Thanks to my question. Um, Tony, you you're you've made so many impressive, improvements to the to the platform and we can see it in the results. Let me ask you a little bit of a tricky 1. Can you talk to us about the areas where you've had more challenges than you expected in sort of improving the product? Improving the customer experience, improving the merchant service? What are those areas that are proven to be harder that we should sort of look for the next unlocks to come from long term on the platform. Thanks,

Yeah. Hey Brian. I wish you get to, you know, have a peek into my inbox because I get several hundred emails a week, you know, from all of our audiences whether it's consumers, Dashers or merchants, and I don't know if they think that our improvements are very impressive.

Those emails tend to, uh, uh, perhaps suggest the opposite, um, which is a daily reminder. Given that, I’ve done customer support now daily for each day for the last 12 years, that, um, we seem to be falling short, actually. Um, so I’m not so sure that I agree with the premise of the question. It’s not tricky at all, the question, because I actually think we’re pretty, uh, far behind in each one of the areas that, from, um, you know, from the perspective of the customer, not the perspective of what our business metrics suggest, um, or our competitive position. And so, um,

Look. I mean, this is true. Uh, maybe we can take an example this morning. Um, I I received an email about how we showed up at the wrong parking lot inside a apartment complex, um, and, and and, and, and, you know, that that caused both a delay and delivery as well as, you know, a fear that perhaps the driver wasn't even going to show up.

And, and, and so, whether it's very small, things like that, that sounds very small, um, but when you compound them to the billions of orders that we do, um, uh, to, you know, understanding how do we, um, play now in New geographies, Or new categories or, um, how how might the product of the change, uh, you know, given where the world is going with AI or, um, how business models? Uh, you know, uh, might be adding complexity to our own business. We talked to, you know, a bit about sass earlier. Um, I would say there are many areas Brian in which we're we're struggling. And every day I think is a daily struggle where the job is to try to make an improvement for that day.

Opportunities everywhere.

That's really helpful. Thanks Tony.

There's no further question at this time. That concludes today's call. Thank you all for joining you may now disconnect