Maplebear Inc.
For the period ended Mar 31, 2025. Filed May 8, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 8, 2025
CART$58.12+0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-13.
0001579091-24-000103
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001579091-25-000048
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 185 previous paragraphs and 170 current paragraphs.
95 unchanged; 56 reworded; 16 added; 32 removed; 2 previous and 3 current paragraphs rearranged.
Tables are not compared: 21 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
In the first quarter of 2025, gross profit increased to$671 million, or 9% growth, compared to the same quarter of 2024, primarily driven by the increase intotal revenue. Gross margin remained flat at 75% in the first quarter of 2025, compared to the same quarter of 2024.
Current report
We primarily generate advertising and other revenue from:
Current report
Advertising revenue is recognized upon delivery of clicks, upon delivery of impressions, over the contract term on a fixed fee basis, or upon redemptions of coupons. For advertising arrangements that involve third parties, we record advertising revenue on a gross or net basis based on whether we act as a principal or agent in the transaction, which is assessed on a contract by contract basis. When we act as the principal and control the services provided to the brand partner, we record revenue on a gross basis, recognizing fees from the brand partner as revenue and related payments to the publisher as cost of revenue. When we act as an agent and do not control the services, we record revenue on a net basis, representing only the net amount received from the brand partner after payments to the publisher.
Current report
Provision for Income Taxes
Current report
On March 10, 2025, lawmakers in the U.S. House of Representatives introduced the American Innovation and R&D Competitiveness Act of 2025. This proposed legislation intends to restore the immediate expensing of research and experimental expenditures, reversing the capitalization requirement. We are monitoring these developments and evaluating the potential impact on our results of operations.
Current report
The increase in advertising and other revenue during the first quarter of 2025, compared to the same quarter of 2024, was primarily driven by interrelated factors including an increase in advertising volume, activity on our platform, and strength from both large and emerging brand partners. Advertising and other investment rate increased by 10 basis points to 2.7% during the first quarter of 2025, compared to the same quarter of 2024, as advertising and other revenue grew faster than GTV.
Current report
The increase in sales and marketing expense during the first quarter of 2025, compared to the same quarter in 2024, was primarily due to an increase of $22 million in marketing costs, primarily from increased paid marketing, and an increase of $10 million in consulting costs.
Current report
Provision for Income Taxes
Current report
(5)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
(3)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
(3)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
(3)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
(5)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
(5)Represents severance payments and other related benefits for terminated employees in connection with our restructuring plan during the first quarter of 2024. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Current report
For the three months ended March 31, 2024, net cash provided by operating activities was $105 million, which consisted ofnet income of$130 million, adjusted by non-cash items of$74 million, primarily driven by deferred income taxesof $41 million and by net cash outflows from changes in operating assets and liabilities of$99 million. The year over year decrease in net changes in operating assets and liabilities, which impacted cash provided by operating activities, from a net cash inflow of $70 million to $105 million was primarily driven by fluctuations in working capital from general business impacts such as the timing of customer collections impacted by the mix of transaction types, such as those involving EBT SNAP, which result in longer and uneven collection cycles, the overall growth of our business, and the timing of customer, vendor, and other third party payments.
Current report
As of March 31, 2025, there have been no material changes from the contractual obligations and commitments as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024.
Removed paragraphs (32)
Previous report
Restructuring Plan
Previous report
On February 9, 2024, we announced a restructuring plan, including a reduction of approximately 250 employees, most of which was completed during the first quarter of 2024. As a result of our restructuring plan, we have generated cost savings within operating expenses during fiscal year 2024, compared to fiscal year 2023, which we are reinvesting into the business to drive profitable growth. See further details in Note 15 — Restructuring included in Part I, Item 1 of this Quarterly Report on Form 10-Q.
Previous report
(1) Includes$2.6 billion of stock-based compensation expense associated with the cumulative vesting of certain equity awards in connection with our IPO in the third quarter of 2023.
Previous report
In the third quarter of 2024, gross profit increased to$641 million, or 14% growth, compared to the same quarter of 2023, and gross margin increased from 73% in the third quarter of 2023 to 75% in the third quarter of 2024, primarily due to a decrease in stock-based compensation expense associated with the vesting of RSUs in connection with our IPO in the prior period, in addition totransaction revenue increasing at a faster pace than cost of revenue.
Previous report
We generate advertising and other revenue primarily from:
Previous report
Provision for (Benefit from) Income Taxes
Previous report
The increase in transaction revenue during the first nine months of 2024, compared to the same period of 2023 was primarily driven by growth in GTV, which grew 11%, and increased fulfillment efficiencies, partially offset by increased investments in consumer incentives in the first nine months of 2024.
Previous report
The increase in advertising and other revenue during the third quarter of 2024, compared to the same quarter of 2023, was primarily driven by an increase in advertising volume. Strength in emerging brand spend was also partially offset by a decrease in spend by certain of our large brand partners in response to macroeconomic uncertainty and changes in our brand partners’ businesses and performance. Advertising and other investment rate of 3.0% during the third quarter of 2024 remained flat compared to the same period of 2023.
Previous report
The increase in advertising and other revenue during the first nine months of 2024, compared to the same period of 2023, was primarily driven by an increase in advertising volume, partially offset by changes in spend by certain of our brand partners in response to macroeconomic uncertainty and changes in our brand partners’ businesses and performance. Advertising and other investment rate of 2.8% remained flat during the first nine months of 2024, compared to the same period of 2023.
Previous report
The increase in cost of revenue during the first nine months of 2024, compared to the same period of 2023, was primarily due to an increase of $29 million in credit card processing fees, an increase of $11 million in delivery-related insurance, an increase of $8 million in depreciation and amortization expense primarily related to capitalized internal-use software, and an increase of $7 million in enterprise solution costs, partially offset by a decrease of $9 million in compensation costs and a decrease of $8 million in payment chargebacks. The net decrease in total compensation cost was primarily driven by a decrease in stock-based compensation expense and related payroll taxes resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period.
Previous report
The increase in gross profit during the third quarter of 2024, compared to the same quarter of 2023, was primarily driven by the increase in revenue due to the factors described above. The increase in gross margin during the third quarter of 2024, compared to the same period of 2023, was primarily due to a decrease in stock-based compensation expense associated with the vesting of RSUs in connection with our IPO in the prior period in addition totransaction revenue increasing at a faster pace than cost of revenue.
Previous report
The decrease in operations and support expense during the first nine months of 2024, compared to the same period of 2023, was primarily due to a decrease of $81 million in compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period, partially offset by an increase of $8 million in subscriptions and software costs.
Previous report
The decrease in research and development expense during the third quarter of 2024, compared to the same quarter in 2023, was primarily due to a net decrease of $1,730 million in total compensation costs, partially offset by a decrease of $30 million in capitalized software development costs. The net decrease in total compensation cost was primarily driven by a decrease in stock-based compensation expense and related payroll taxes resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period and a decrease in cash compensation expense related to changes in the mix of our employee cash and equity compensation and reduced headcount following our restructuring plan.
Previous report
The decrease in sales and marketing expense during the third quarter of 2024, compared to the same quarter in 2023, was primarily due to a decrease of $281 million in compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period, partially offset by an increase of $34 million in marketing costs.
Previous report
The decrease in sales and marketing expense during the first nine months of 2024, compared to the same period of 2023, was primarily due to a decrease of $245 million in compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period, partially offset by an increase of $47 million in marketing costs and an increase of $7 million of consulting costs.
Previous report
The decrease in general and administrative expense during the first nine months of 2024, compared to the same period of 2023, was primarily due to a net decrease of $464 million in total compensation costs, partially offset by an increase of $41 million in accruals for sales and indirect taxes and legal matters and settlements and an increase of $10 million in professional fees. The net decrease in total compensation costs was primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period.
Previous report
Provision for (Benefit from) Income Taxes
Previous report
•does not reflect other income that may increase cash available to us;
Previous report
In the third quarter of 2023, employer payroll taxes related to the vesting and settlement of certain equity awards in connection with our IPO were excluded from our calculation of Adjusted EBITDA. Starting in the fourth quarter of 2023 and going forward, we excluded employer payroll taxes related to the vesting and settlement of equity awards from our calculation of Adjusted EBITDA. We have historically excluded stock-based compensation expense from Adjusted EBITDA, and management believes that excluding the related payroll tax expense is important and consistent, as such payroll tax expense is directly impacted by unpredictable fluctuations in our stock price and therefore may not be indicative of our core operating performance. Prior period comparative amounts were not material and were not recast to conform to this new presentation.
Previous report
(5)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
(3)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
(3)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
(3)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
(5)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
(4)Represents sales and other indirect tax reserves, net of abatements, for periods in which we were unable to collect such taxes from customers. We believe this adjustment is useful for investors in understanding our operating performance because in these cases, the taxes were not intended to be a cost to us but rather are to be borne by the customers.
Previous report
(5)Represents severance payments and other related benefits for terminated employees in connection with the restructuring plan. Refer to Note 15 — Restructuring to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for more information.
Previous report
For the nine months ended September 30, 2023, net cash provided by operating activities was $353 million, which consisted ofnet loss of$1,757 million, adjusted for certain non-cash items of$2,279 million, and net cash outflows from changes in operating assets and liabilities of$169 million. The non-cash items primarily consisted of stock-based compensation expense of$2,614 million, deferred income taxes of $394 million, depreciation and amortization expense of$33 million, and bad debt expense of $18 million. The net cash outflows from changes in our operating assets and liabilities were primarily due to$108 million decrease in accrued and other current liabilities, a$38 million decrease in other long-term liabilities, a $31 million decrease in accounts payable, and a$17 million increase in accounts receivable, partially offset by a $22 million increase in deferred revenue and a$14 million decrease in prepaid expenses and other assets. These cash outflows were primarily due to timing of customer and vendor payments.
Previous report
For thenine months ended September 30, 2023, net cash provided by financing activities was $6 million, comprised primarily of $401 million of proceeds from the issuance of common stock upon IPO, net of underwriting discounts and $175 million of proceeds from the issuance of our Series A Preferred Stock, partially offset by $570 million of tax withholding paid related to the net share settlement of equity awards.
Previous report
Operating Leases
Previous report
Our operating lease commitments primarily include corporate offices and warehouse space. As of December 31, 2023, we had fixed lease payment obligations of $43 million, with $15 million to be paid within 12 months and the remainder thereafter. For additional discussion on our operating leases, see Note 9 — Commitments and Contingencies to our condensed consolidated financial statements included in Part I, Item I of this Quarterly Report on Form 10-Q.
Previous report
Non-cancellable Purchases
Previous report
Our non-cancellable purchase commitments are primarily related to infrastructure service contracts for technology platforms. As of September 30, 2024, we had non-cancellable purchase obligations of $269 million, with $97 million to be paid within 12 months and the remainder thereafter.
Reworded paragraphs (56)
Previous wording
Instacart was founded in 2012 to bring the grocery industry online and help make grocery shopping effortless. We started by understanding what consumers want and then built enterprise-grade technologies that allow retailers to meet those needs. Instacart invented a new model for online grocery shopping by offering consumers on-demand delivery from the stores they know and trust. Retailers reach customers through both Instacart Marketplace, where customers can shop from their favorite retailers through our app or website, and retailers’ owned and operated online storefronts that are powered by Instacart Enterprise Platform, our end-to-end technology solution encompassing e-commerce, fulfillment, Connected Stores, ads and marketing, and insights.
Current wording
Retailers reach customers through both Instacart Marketplace, where customers can shop from their favorite retailers through our app or website, and retailers’ owned and operated online storefronts that are powered by Instacart Enterprise Platform, our end-to-end technology solution encompassing e-commerce, fulfillment, Connected Stores, ads and marketing, and insights. As consumers and retailers move online, brands can use Instacart Ads as an effective way to reach
Previous wording
In addition, brands can use Instacart Ads as a new way to reach customers at the point of purchase and within minutes of delivery and consumption. Instacart Ads offers brands a highly measurable ads offering that leverages first-party transaction data to move products off store shelves more efficiently.
Current wording
customers at the point of purchase and within minutes of delivery and consumption
Previous wording
Instacart started as a way for households to conveniently manage their weekly grocery shopping, a recurring and high order value consumer use case. Today, customers can place orders for delivery or pickup across a variety of use cases including the weekly shop, bulk stock-up, convenience, and special occasions. Customers can select the fulfillment option and speed that best serve their needs. Each order can be shopped for and delivered with care by one of the hundreds of thousands of shoppers who value the flexible earnings opportunities that Instacart provides.
Current wording
Instacart started as a way for households to conveniently manage their weekly grocery shopping, a recurring and high order value consumer use case. Today, customers can place orders for delivery or pickup across a variety of use cases including the weekly shop, bulk stock-up, convenience, special occasions, from restaurants, and using our in-store technologies. Customers can select the fulfillment option and speed that best serve their needs. Each order can be shopped for and delivered with care by one of the hundreds of thousands of shoppers who value the flexible earnings opportunities that Instacart provides.
Previous wording
Our business, financial condition, and key business metrics have been, and are expected to continue to be impacted by recent macroeconomic trends affecting our markets and industry such as higher inflation, elevated interest rates, the effects of supply chain challenges, cessation of government aid programs, geopolitical conflicts, uncertainty regarding an economic recession and associated decreases in consumer discretionary income, changing consumer preferences, and the effects of severe weather patterns. For example, decreases in consumer discretionary income due to inflationary or recessionary economic pressures and elevated interest rates, as well as cessation of government aid, have adversely impacted and continue to adversely impact order volumes, customer acquisition and retention, and demand for premium or discretionary grocery purchases.
Current wording
Our business, financial condition, customer acquisition and retention, and key business metrics, including GTV and orders, may be impacted by macroeconomic trends affecting our markets and industry and consumer shopping habits, such as inflation or interest rate fluctuations, the effects of supply chain challenges, the impact of tariffs or other trade restrictions, geopolitical conflicts, regulatory changes, uncertainty regarding an economic recession and associated decreases in consumer discretionary income, and the effects of severe weather patterns.
Previous wording
We define an order as a completed customer transaction to purchase goods for delivery or pickup primarily from a single retailer on Instacart during the period indicated, including those completed through Instacart Marketplace or retailers’ owned and operated online storefronts that are powered by Instacart Enterprise Platform. We believe that orders are an indicator of the scale and growth of our business as well as the value we bring to our constituents.
Current wording
We define an order as a completed customer transaction to purchase goods for delivery or pickup primarily from a single retailer through Instacart during the period indicated, including those completed through Instacart Marketplace or services that are part of the Instacart Enterprise Platform. We believe that orders are an indicator of the scale and growth of our business as well as the value we bring to our constituents.
Previous wording
In the third quarter of 2024, orders increased to 72.9 million, or 10% growth, compared to the same quarter of 2023, which was driven primarily by new customers and increased engagement of existing customers.
Current wording
In the first quarter of 2025, orders increased to 83.2 million, or 14% growth, compared to the same quarter of 2024, driven primarily by new customers and increased engagement of existing customers.
Previous wording
We define GTV as the value of the products sold based on prices shown on Instacart, in addition to applicable taxes, deposits and other local fees, customer tips, which go directly to shoppers, customer fees, which include flat subscription fees related to Instacart+ that are charged monthly or annually, and other fees. GTV consists of orders primarily completed through Instacart Marketplace or services that are part of the Instacart Enterprise Platform. We believe that GTV indicates the health of our business, including our ability to drive revenue and profits, and the value we provide to our constituents. We have experienced and expect to continue to experience fluctuations in GTV growth over the near term.
Current wording
We define GTV as the value of the products sold through Instacart, including applicable taxes, deposits and other local fees, customer tips, which go directly to shoppers, customer fees, which include flat subscription fees related to Instacart+ that are charged monthly or annually, and other fees. GTV consists of orders including those completed through Instacart Marketplace or services that are part of the Instacart Enterprise Platform. We believe that GTV indicates the health of our business, including our ability to drive revenue and profits, and the value we provide to our constituents. We have experienced and expect to continue to experience fluctuations in GTV growth, including due to the macroeconomic conditions described above, changes in customer and retailer engagement, and the effects of our strategic initiatives.
Previous wording
In the third quarter of 2024, GTV increased to $8,303 million, or 11% growth compared to the same quarter of 2023, driven primarily by the increase in orders and, to a lesser extent, higher average order value.
Current wording
In the first quarter of 2025, GTV increased to $9,122 million, or 10% growth, compared to the same quarter of 2024, primarily driven by the increase in orders partially offset by lower average order value.
Previous wording
Gross profit is defined as revenue less cost of revenue, and gross margin is defined as gross profit as a percent of revenue. We believe that gross profit, gross margin, gross profit as a percent of GTV are important indicators of the growth and efficiencies of our business.
Current wording
Gross profit is defined as revenue less cost of revenue, and gross margin is defined as gross profit as a percent of revenue. We believe that gross profit, gross margin, and gross profit as a percent of GTV are important indicators of the growth and efficiencies of our business.
Previous wording
We define Adjusted EBITDA as net income (loss), adjusted to exclude (i) provision for (benefit from) income taxes, (ii) interest income, (iii) other expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation expense, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, (ix) acquisition-related expenses, (x) restructuring charges, and (xi) issuance costs related to the issuance of our Series A Preferred Stock. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue. For more information about how we use these non-GAAP financial measures in our business, the limitations of these measures, and reconciliations of these measures to the most directly comparable GAAP financial measures, see the section titled “—Non-GAAP Financial Measures.”
Current wording
We define Adjusted EBITDA as net income, adjusted to exclude (i) provision for income taxes, (ii) interest income, (iii) other expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation expense, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, net, and (ix) restructuring charges. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue. For more information about how we use these non-GAAP financial measures in our business, the limitations of these measures, and reconciliations of these measures to the most directly comparable GAAP financial measures, see the section titled “—Non-GAAP Financial Measures.”
Previous wording
In the third quarter of 2024, Adjusted EBITDA increased to $227 million, or 39% growth compared to the same quarter of 2023, primarily driven by revenue growth and efficiencies within adjusted total operating expenses. Our Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin can vary significantly as we continue to make substantial investments to fuel our growth and scale our business.
Current wording
In the first quarter of 2025, Adjusted EBITDA increased to $244 million, or 23% growth, compared to the same quarter of 2024, primarily driven by a combination of strong GTV growth and operating leverage. Our Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin can vary significantly as we continue to make substantial investments to fuel our growth and scale our business.
Previous wording
•end users, whom we refer to as customers, (i) through service and delivery fees paid for arranging fulfillment services from shoppers and (ii) for monthly or annual Instacart+ memberships, our membership program, which offers unlimited free delivery on orders over a certain size, a reduced service fee, credit back on eligible pickup orders, and exclusive benefits;
Current wording
•end users, whom we refer to as customers, (i) through service and delivery fees paid for arranging fulfillment services from shoppers and (ii) for monthly or annual Instacart+ memberships, our membership program, which offers unlimited $0 delivery fees on orders over a certain size, and other exclusive benefits;
Previous wording
Advertising revenue is recognized upon delivery of clicks for Sponsored Product ads, upon delivery of impressions or over the contract term on a fixed fee basis for display ads, or upon redemptions of coupons. Advertising and other revenue has historically been, and is expected to continue to be, seasonally high in the fourth quarter and seasonally low in the first quarter in a given year as a result of how advertisers deploy their budgets. In addition, we expect our advertising and other revenue growth rate and advertising and other investment rate(which we define as advertising and other revenue in a given period divided by GTV in such period) to continue to fluctuate, particularly during periods of acceleration or decreases in our GTV growth. We also expect advertising and other investment rate to fluctuate during periods in which we generate more GTV from sources where we do not provide advertising or where we have recently enabled advertising, such as from certain new offerings or use cases and from retailers’ owned and operated online storefronts including those utilizing Instacart API that do not partner with Carrot Ads. We also expect our advertising and other revenue growth to fluctuate in the near term due to changes in brand partner spend, including as a result of the macroeconomic factors described above and in response to our GTV growth trends, which may occur on a delayed basis.
Current wording
Advertising and other revenue has historically been, and is expected to continue to be, seasonally high in the fourth quarter and seasonally low in the first quarter in a given year as a result of how advertisers deploy their budgets. In addition, we expect our advertising and other revenue growth rate and advertising and other investment rate(which we define as advertising and other revenue in a given period divided by GTV in such period) to continue to fluctuate, particularly during periods of acceleration or decreases in our GTV growth. We also expect advertising and other investment rate to fluctuate during periods in which we generate more GTV from sources where we do not provide advertising or where we have recently enabled advertising, such as from certain new offerings or use cases and from retailers’ owned and operated online storefronts including those utilizing Instacart API that do not partner with Carrot Ads. We also expect our advertising and other revenue growth to fluctuate in the near term due to changes in brand partner spend, including as a result of the macroeconomic factors described above and in response to our GTV growth trends, which may occur on a delayed basis, as well as changes in the mix of revenue contribution from advertising contracts in effect in a particular period and related recognition of advertising revenue on a gross or net basis.
Previous wording
Cost of revenue primarily consists of third-party payment processing fees, expenses related to payment chargebacks, compensation costs of our employees primarily involved in fulfillment, hosting fees, insurance costs attributed to fulfillment, depreciation expense, and amortization expense of technology-related intangible assets and capitalized internal-use software. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense.
Current wording
Cost of revenue primarily consists of third-party payment processing fees, expenses related to payment chargebacks, hosting fees, insurance costs attributed to fulfillment, compensation costs of our employees primarily involved in fulfillment, depreciation expense, and amortization expense of technology-related intangible assets and capitalized internal-use software. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense.
Previous wording
General and administrative expense primarily consists of compensation costs for administrative employees, including finance and accounting, human resources, policy, and legal; third-party consulting fees; allocations of various overhead and occupancy costs; depreciation expense; and amortization expense of patents and trademarks. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense.
Current wording
General and administrative expense primarily consists of compensation costs for administrative employees, including finance and accounting, human resources, policy, and legal; third-party consulting fees; allocations of various overhead and occupancy costs; depreciation expense; amortization expense of patents and trademarks; and taxes. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense.
Previous wording
The provision for (benefit from) income taxes consists primarily of income taxes in certain federal, state, local, and foreign jurisdictions in which we conduct business. Our provision for (benefit from) income taxes differs from the U.S. federal statutory income tax rate primarily due to the tax effects of stock-based compensation recognized, U.S. research and development credits generated, and the income taxes generated in U.S. states and foreign jurisdictions. Our future effective income tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income. We carefully monitor these factors and adjust our effective income tax rate accordingly.
Current wording
The provision for income taxes consists primarily of income taxes in certain federal, state, local, and foreign jurisdictions in which we conduct business. Our provision for income taxes differs from the U.S. federal statutory income tax rate primarily due to the tax effects of stock-based compensation recognized, U.S. research and development credits generated, and the income taxes generated in U.S. states and foreign jurisdictions. Our future effective income tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income.
Previous wording
The following table sets forth our results of operations for the periods indicated:
Current wording
The following table summarizes our results of operations for the periods indicated:
Previous wording
The following table sets forth the components of our condensed consolidated statements of operations data, for each of the periods presented, as a percent of revenue.
Current wording
The following table summarizes the components of our condensed consolidated statements of operations data, for each of the periods presented, as a percent of revenue.
Previous wording
Comparison of the Three and Nine Months Ended September 30, 2023 and 2024
Current wording
Comparison of the Three Months Ended March 31, 2024 and 2025
Previous wording
The increase in transaction revenue during the third quarter of 2024, compared to the same quarter of 2023, was primarily driven by growth in GTV, which grew 11%, and increased fulfillment efficiencies, partially offset by increased investments in affordability initiatives and consumer incentives in the third quarter of 2024.
Current wording
The increase in transaction revenue during the first quarter of 2025, compared to the same quarter of 2024, was primarily driven by growth in GTV, which grew 10%, lower consumer incentives, and increased fulfillment efficiencies, partially offset by our ongoing investment into affordability initiatives designed to increase customer engagement during the first quarter of 2025.
Previous wording
The increase in cost of revenue during the third quarter of 2024, compared to the same quarter of 2023, was primarily due to an increase of $8 million in credit card processing fees, an increase of $4 million in delivery-related insurance, and an increase of $4 million in depreciation and amortization expense primarily related to capitalized internal-use software, partially offset by a decrease of $15 million in compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period.
Current wording
The increase in cost of revenue during the first quarter of 2025, compared to the same quarter of 2024, was primarily due to an increase of $10 million in credit card processing fees, an increase of $7 million in depreciation and amortization expense primarily related to capitalized internal-use software, and an increase of $7 million in payments to publishers.
Previous wording
The increase in gross profit during the first nine months of 2024, compared to the same period of 2023, was primarily driven by the increase in revenue due to the factors described above. Gross margin during the first nine months of 2024, compared to the same period of 2023, remained flat.
Current wording
The increase in gross profit during the first quarter of 2025, compared to the same quarter of 2024, was primarily driven by the increase in total revenue due to the factors described above. Gross margin during the first quarter of 2025, compared to the same period of 2024, remained flat.
Previous wording
The decrease in operations and support expense during the third quarter of 2024, compared to the same quarter in 2023, was primarily due to a decrease of $86 million in compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period.
Current wording
The increase in operations and support expense during the first quarter of 2025, compared to the same quarter in 2024, was not material.
Previous wording
The decrease in research and development expense during the first nine months of 2024, compared to the same period of 2023, was primarily due to a net decrease of $1,672 million in total compensation costs partially offset by a decrease of $10 million in capitalized software development costs. The net decrease in total compensation cost was primarily driven by a decrease in stock-based compensation expense and related payroll taxes resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period, a decrease in cash compensation expense related to changes in the mix of our employee cash and equity compensation, and reduced headcount following our restructuring plan, and a $79 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures and for terminated employees in connection with the restructuring plan in the first quarter of 2024.
Current wording
The increase in research and development expense during the first quarter of 2025, compared to the same quarter in 2024, was primarily due to a net increase of $34 million in total compensation costs. The net increase in total compensation cost was primarily driven by an increase in stock-based compensation expense due to a $79 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures and for terminated employees in connection with our restructuring plan in the first quarter of 2024, partially offset by a decrease in cash compensation expenses related to changes in the mix of our employee cash and equity compensation and bonuses.
Previous wording
The decrease in general and administrative expense during the third quarter of 2024, compared to the same quarter of 2023, was primarily due to a net decrease of $506 million in total compensation costs, primarily driven by a decrease in stock-based compensation expense resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO in the prior period, partially offset by an increase of $14 million in accruals for sales and indirect taxes and legal matters and settlements.
Current wording
The increase in general and administrative expense during the first quarter of 2025, compared to the same quarter of 2024, was primarily due to an increase of $41 million in accruals for legal matters and sales and indirect taxes, partially offset by a decrease of $11 million in total compensation costs.
Previous wording
The decrease in interest income during the third quarter of 2024, compared to the same quarter of 2023, was primarily due to a decrease in cash and cash equivalents and short-term marketable securities.
Current wording
The decrease in interest income during the first quarter of 2025, compared to the same quarter of 2024, was primarily due to lower interest rates and a reduction in the average balance of our cash, cash equivalents, and marketable securities over the respective periods.
Previous wording
The increase in the provision for (benefit from) income taxes during the third quarter of 2024 and the first nine months of 2024, compared to the same periods of 2023, was primarily driven by the tax benefit related to the recognition of stock-based compensation expense, including certain restructurings, resulting from RSUs with a liquidity event-based vesting condition that was satisfied in connection with our IPO during the third quarter of 2023.
Current wording
The decrease in the provision for income taxes during the first quarter of 2025, compared to the same quarter of 2024, was primarily driven by the decrease in profit before provision for income taxes due to the factors described above and an increase in the tax benefit from stock-based compensation during the first quarter of 2025, compared to the same quarter of 2024.
Previous wording
Our definitions may differ from the definitions used by other companies and therefore comparability may be limited. In addition, other companies may not publish these or similar metrics. Further, these metrics have certain limitations in that they do not include the impact of certain expenses that are reflected in our condensed consolidated statements of operations. Thus, our Non-GAAP Measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with GAAP.
Current wording
Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated statements of operations prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies, which reduce their usefulness as comparative measures. In addition, other companies may not publish these or similar measures. Further, these measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our consolidated statements of operations.
Previous wording
We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and to view our Non-GAAP Measures in conjunction with their respective most directly comparable financial measure calculated in accordance with GAAP.
Current wording
We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business.
Previous wording
We define Adjusted EBITDA as net income, adjusted to exclude (i) provision for (benefit from) income taxes, (ii) interest income, (iii) other expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation expense, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, (ix) acquisition-related expenses, (x) restructuring charges, and (xi) issuance costs related to the issuance of our Series A Preferred Stock. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue.
Current wording
We define Adjusted EBITDA as net income, adjusted to exclude (i) provision for income taxes, (ii) interest income, (iii) other expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation expense, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, net, and (ix) restructuring charges. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue.
Previous wording
•does not reflect other income and expense that includes unrealized and realized gains and losses on foreign currency exchange; and
Current wording
•does not reflect other income or expense that includes unrealized and realized gains and losses on foreign currency exchange; and
Previous wording
The following table presents a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated in accordance with GAAP:
Current wording
The following table presents a reconciliation of Adjusted EBITDA to net income, the most directly comparable financial measure calculated in accordance with GAAP:
Previous wording
(1) The nine months ended September 30, 2024 includes an aggregate $95 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures in the first quarter of 2024 and for terminated employees in connection with the restructuring plan.
Current wording
(1) The first quarter of 2024 includes an aggregate $95 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures in the first quarter of 2024 and for terminated employees in connection with our restructuring plan during the first quarter of 2024.
Previous wording
Adjusted Operations and Support and Adjusted Operations and Support as a Percent of GTV
Current wording
Adjusted Operations and Support Expense and Adjusted Operations and Support Expense as a Percent of GTV
Previous wording
We define adjusted operations and support expense as operations and support expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature. We exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as these are not indicative of our operating performance.
Current wording
We define adjusted operations and support expense as operations and support expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature. We exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as they are not indicative of our operating performance.
Previous wording
(1) The nine months ended September 30, 2024 includes a $4 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for terminated employees in connection with the restructuring plan.
Current wording
(1) The first quarter of 2024 includes a $4 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for terminated employees in connection with our restructuring plan during the first quarter of 2024.
Previous wording
Adjusted Research and Development and Adjusted Research and Development as a Percent of GTV
Current wording
Adjusted Research and Development Expense and Adjusted Research and Development Expense as a Percent of GTV
Previous wording
We define adjusted research and development expense as research and development expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature and we exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as these are not indicative of our operating performance.
Current wording
We define adjusted research and development expense as research and development expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature and we exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as they are not indicative of our operating performance.
Previous wording
(1) The nine months September 30, 2024 includes a $79 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures in the first quarter of 2024, and for terminated employees in connection with the restructuring plan.
Current wording
(1) The first quarter of 2024 includes a $79 million benefit related to the reversal of previously recognized stock-based compensation expense for unvested equity awards for executive departures in the first quarter of 2024, and for terminated employees in connection with our restructuring plan during the first quarter of 2024.
Previous wording
Adjusted Sales and Marketing and Adjusted Sales and Marketing as a Percent of GTV
Current wording
Adjusted Sales and Marketing Expense and Adjusted Sales and Marketing Expense as a Percent of GTV
Showing the first 40 of 56 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
We define adjusted general and administrative expense as general and administrative expense excluding depreciation and amortization expense; stock-based compensation expense; payroll taxes related to stock-based compensation; certain legal and regulatory accruals and settlements, net; reserves for sales and other indirect taxes, net; and restructuring charges.
Current report — wording carried from elsewhere
(4)Represents sales and other indirect tax reserves, net of abatements, for periods in which we were unable to collect such taxes from customers. We believe this adjustment is useful for investors in understanding our underlying operating performance because in these cases, the taxes were not intended to be a cost to us but rather are to be borne by the customers.
Current report — wording carried from elsewhere
For thethree months ended March 31, 2024, net cash used in financing activities was $750 million, comprised primarily of repurchases of common stock $715 million and taxes paid related to net share settlement of equity awards of $83 million, partially offset by proceeds from the exercise of stock options of $49 million.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Previous report — wording carried elsewhere
The decrease in interest income during the first nine months of 2024, compared to the same period of 2023, was immaterial.