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DoorDash Eyes Long-Term Investment Over Short-Term Gains
19 Feb
Summary
- DoorDash forecasts lower adjusted EBITDA due to increased investment.
- Winter storms and rising Dasher costs impact first-quarter earnings.
- Company is merging operations onto a single technology platform.
DoorDash is projecting lower adjusted earnings before interest, taxes, depreciation, and amortization for the first quarter of 2026, estimating it to be between $675 million and $775 million. This forecast is below analyst expectations and is attributed to increased strategic investments. These investments are directed towards its international businesses, including further funding for Deliveroo, the British company acquired last year. Expansion into grocery and retail categories, as well as development in newer business areas, are also key focuses.
The company's financial outlook is further influenced by external factors. An estimated $20 million impact from winter storms Gianna and Fern in the U.S. is anticipated. Additionally, DoorDash expects a quarter-over-quarter rise in Dasher costs per order. These pressures are occurring despite DoorDash's plans to significantly ramp up investment in new initiatives and platform development throughout 2026, a multi-hundred-million-dollar commitment.
DoorDash is actively working on enhancing its marketplace offerings, improving membership program value, and advancing its artificial intelligence capabilities. A significant undertaking is the relaunch of its products on a unified technology platform, designed to integrate DoorDash, Wolt, and Deliveroo. CEO Tony Xu emphasized this as a 'massive and expensive undertaking,' essential for building enduring systems through long-term investment and strategic rebuilding.
Despite the near-term profitability concerns, DoorDash also provided positive guidance for gross order value, expecting it to range from $31 billion to $31.8 billion for the first quarter. The company is on track to increase its full-year adjusted EBITDA as a percentage of gross order value compared to 2025, with Deliveroo projected to contribute approximately $200 million to adjusted EBITDA this year. In its latest reported quarter, DoorDash saw increased profit and revenue, with orders climbing 32% to 903 million, bolstered by the Deliveroo acquisition.
