DoorDash Inc

Previous wording

We operate a local commerce platform that connects merchants, consumers, and Dashers. Our primary offerings are the DoorDash Marketplace and the Wolt Marketplace (our "Marketplaces"), which together operate in over 30 countries across the globe. Our Marketplaces provide a suite of services that enable merchants to establish an online presence, generate demand, seamlessly transact with consumers, and fulfill orders primarily through independent contractors who use our platform to deliver orders ("Dashers"). Dashers that use our DoorDash Marketplace and Wolt Marketplace are referred to as "DoorDash Dashers" and "Wolt courier partners," respectively, in this Quarterly Report on Form 10-Q. As part of our Marketplaces, we also offer Pickup, which allows consumers to place advance orders, skip lines, and pick up their orders conveniently with no consumer fees, as well as DoorDash for Business, which provides merchants on our platform with large group orders and catering orders for businesses and events. The DoorDash Marketplace also includes DashPass and the Wolt Marketplace includes Wolt+. DashPass and Wolt+ are our membership products, which provide members with unlimited access to eligible merchants with zero delivery fees and reduced service fees on eligible orders.

Current wording

We operate a local commerce platform that connects merchants, consumers, and Dashers. Our primary offerings are the DoorDash Marketplace and the Wolt Marketplace (our "Marketplaces"), which together operate in over 30 countries across the globe. Our Marketplaces provide a suite of services that enable merchants to establish an online presence, generate demand, seamlessly transact with consumers, and fulfill orders primarily through independent contractors who use our platform to deliver orders ("Dashers"). Dashers that use our DoorDash Marketplace and Wolt Marketplace are referred to as "DoorDash Dashers" and "Wolt courier partners," respectively, in this Quarterly Report on Form 10-Q. The DoorDash Marketplace also includes DashPass and the Wolt Marketplace includes Wolt+. DashPass and Wolt+ are our membership products, which provide members with unlimited access to eligible merchants with zero delivery fees and reduced service fees on eligible orders.

Previous wording

In addition to our Marketplaces, we offer Platform Services, which primarily includes DoorDash Drive and Wolt Drive, which are white-label delivery fulfillment services that enable merchants that have generated consumer demand through their own channels to fulfill this demand using our platform. Platform Services also includes DoorDash Storefront, which enables merchants to create their own branded online ordering experience, providing them with a turnkey solution to offer consumers on-demand access to e-commerce without investing in in-house engineering or fulfillment capabilities, and Bbot, which offers merchants solutions for their in-store and online channels, including in-store digital ordering and payments.

Current wording

In addition to our Marketplaces, we offer Platform Services, which primarily includes DoorDash Drive and Wolt Drive, which are white-label delivery fulfillment services that enable merchants that have generated consumer demand through their own channels to fulfill this demand using our platform. Platform Services also includes DoorDash Storefront, which enables merchants to create their own branded online ordering experience, providing them with a turnkey solution to offer consumers on-demand access to e-commerce without investing in in-house engineering or fulfillment capabilities.

Previous wording

In the first quarter of 2024, Total Orders increased to 620 million, or 21% growth compared to the same quarter of 2023. The increase in Total Orders was driven primarily by growth in consumers and increased consumer engagement.

Current wording

In the second quarter of 2024, Total Orders increased to 635 million, or 19% growth compared to the same quarter of 2023. The increase in Total Orders was driven primarily by growth in consumers and increased consumer engagement.

Previous wording

Marketplace GOV. We define Marketplace GOV as the total dollar value of orders completed on our Marketplaces, including taxes, tips 1, and any applicable consumer fees, including membership fees related to DashPass and Wolt+. Marketplace orders include orders completed through Pickup and DoorDash for Business. Marketplace GOV does not include the dollar value of orders, taxes and tips, or fees charged to merchants, for orders fulfilled through Drive, Storefront, or Bbot.

Current wording

Marketplace GOV. We define Marketplace GOV as the total dollar value of orders completed on our Marketplaces, including taxes, tips 1, and any applicable consumer fees, including membership fees related to DashPass and Wolt+. Marketplace GOV does not include the dollar value of orders, taxes and tips, or fees charged to merchants, for orders fulfilled through Drive and Storefront.

Previous wording

In the first quarter of 2024, Marketplace GOV increased to $19.2 billion, or 21% growth compared to the same quarter of 2023, driven primarily by growth in Total Orders.

Current wording

In the second quarter of 2024, Marketplace GOV increased to $19.7 billion, or 20% growth compared to the same quarter of 2023, driven primarily by growth in Total Orders.

Previous wording

In the first quarter of 2024, Net Revenue Margin increased to 13.1% from 12.8% in the same quarter of 2023, primarily due to increasing contribution from advertising revenue.

Current wording

In the second quarter of 2024, Net Revenue Margin increased to 13.3% from 13.0% in the same quarter of 2023, primarily due to increasing contribution from advertising revenue.

Previous wording

In the first quarter of 2024, Contribution Profit increased to $751 million, compared to $533 million in the same quarter of 2023, driven primarily by growth in revenue, partially offset by an increase in cost of revenue.

Current wording

In the second quarter of 2024, Contribution Profit increased to$825 million, compared to$620 million in the same quarter of 2023, driven primarily by growth in revenue, partially offset by increases in cost of revenue and sales and marketing.

Previous wording

In the first quarter of 2024, Adjusted EBITDA increased to $371 million from $204 million in the same quarter of 2023, driven primarily by growth in Contribution Profit, partially offset by increases in adjusted research and development expenses and adjusted general and administrative expenses.

Current wording

In the second quarter of 2024, Adjusted EBITDA increased to $430 million from $279 million in the same quarter of 2023, driven primarily by growth in Contribution Profit.

Previous wording

In the first quarter of 2024, Free Cash Flow increased to$487 million, compared to Free Cash Flow of $316 million in the same quarter of 2023, driven primarily by an increase in net cash provided by operating activities.

Current wording

In the second quarter of 2024, Free Cash Flow increased to$451 million, compared to Free Cash Flow of $311 million in the same quarter of 2023, driven primarily by an increase in net cash provided by operating activities.

Previous wording

Comparison of the Three Months Ended March 31, 2023 and 2024

Current wording

Comparison of the Three and Six Months Ended June 30, 2023 and 2024

Previous wording

We generate a substantial majority of our revenue from orders completed through our Marketplaces and the related commissions charged to partner merchants and fees charged to consumers. Commissions from partner merchants are based on an agreed-upon rate applied to the total dollar value of goods ordered in exchange for using our Marketplaces to sell the partner merchants’ products. Fees from consumers are for the use of our Marketplaces and to arrange for delivery services. Our revenue reflects commissions charged to partner merchants and fees charged to consumers less (i) Dasher payout and (ii) refunds, credits, and promotions, which includes certain discounts and incentives provided to consumers, including those for referring a new customer.

Current wording

We generate a substantial majority of our revenue from orders completed through our Marketplaces and the related commissions charged to partner merchants and fees charged to consumers. Commissions from partner merchants are based on an agreed-upon rate applied to the total dollar value of goods ordered in exchange for using our Marketplaces to sell the partner merchants’ products. Fees from consumers are for the use of our Marketplaces and to arrange for delivery services. Our revenue reflects commissions charged to partner merchants and fees charged to consumers less (i) Dasher payout and (ii) refunds, credits, and promotions, which includes certain discounts and incentives provided to consumers, including those for referring a new consumer.

Previous wording

Revenue increased by $478 million, or 23%, during thefirst quarter of 2024, compared to thesame quarter of 2023. The increase was primarily driven by a 21% increase in Marketplace GOV. During thefirst quarter of 2024, revenue grew at a faster rate than Marketplace GOV during the same period primarily due to an increasing contribution from advertising revenue.

Current wording

Revenue increased by$497 million, or 23%, during thesecond quarter of 2024, compared to thesame quarter of 2023. The increase was primarily driven by a 20% increase in Marketplace GOV. During thesecond quarter of 2024, revenue grew at a faster rate than Marketplace GOV during the same period primarily due to an increasing contribution from advertising revenue.

Previous wording

Cost of revenue, exclusive of depreciation and amortization, increased by$261 million, or 24%, for the first quarter of 2024, compared to the same quarter of 2023. The increase was primarily attributable to an increase of$237 million in order management costs, driven primarily by growth in Total Orders. Order management costs also increased due to an increase in insurance reserves and costs associated with our first-party distribution business.

Current wording

Cost of revenue, exclusive of depreciation and amortization, increased by $250 million, or 22%, for the second quarter of 2024, compared to the same quarter of 2023. The increase was primarily attributable to an increase of $215 million in order management costs, driven primarily by growth in Total Orders. Order management costs also increased due to an increase in insurance reserves and costs associated with our first-party distribution business.

Previous wording

Sales and marketing expenses increased by $8 million, or 2%, for the first quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven byan increaseof$17 million in personnel-related compensation expenses, partially offset by a decrease of$10 million in advertising expenses.

Current wording

Sales and marketing expenses increased by $38 million, or 8%, for the second quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven byan increaseof $17 million in advertising expenses and an increase of$13 million in personnel-related compensation expenses.

Previous wording

General and administrative expenses primarily consist of legal, tax, and regulatory expenses, which include litigation settlement expenses and sales and indirect taxes, personnel-related compensation expenses related to administrative employees, which include finance and accounting, human resources and legal, chargebacks associated with fraudulent credit card transactions, professional services fees, transaction-related costs, bad debt expense, and allocated overhead.

Current wording

General and administrative expenses primarily consist of legal, tax, and regulatory expenses, which include litigation settlement expenses and sales and indirect taxes, personnel-related compensation expenses related to administrative employees, which include finance and accounting, human resources and legal, chargebacks associated with fraudulent credit card transactions, professional services fees, transaction-related costs, impairment expenses, bad debt expense, and allocated overhead.

Previous wording

General and administrative expenses increased by $34 million, or 12%, for thefirst quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven by an increase of $16 million in legal, tax, and regulatory expenses, an increase of $8 million in bad debt expense and chargebacks associated with fraudulent credit card transactions, andan increase of$5 million in personnel-related compensation expenses and allocated overhead.

Current wording

General and administrative expenses increased by$187 million, or 30%, during thefirst six months of 2024, compared to thesame period of 2023. The increase was primarily driven by an increase of$83 million in office lease impairment expenses, an increase of $60 million in legal, tax, and regulatory expenses, andan increase of$8 million in personnel-related compensation expenses and allocated overhead.

Previous wording

Depreciation and amortization expenses increased by $19 million, or 15%, for thefirst quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven by an increase of $22 million in amortization expense related to increased capitalized software and website development costs.

Current wording

Depreciation and amortization expenses increased by$12 million, or 9%, for thesecond quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven by an increase of$17 millionin amortization expense related to increased capitalized software and website development costs.

Previous wording

Interest income, net increased by $18 million for thefirst quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven by an increase in average interest rates during 2023, resulting in higher interest income earned on marketable securities in the first quarter of 2024.

Current wording

Interest income, net increased by$15 million for thesecond quarter of 2024, compared to the same quarter of 2023. The increase was primarily driven by an increase in average interest rates during 2023, resulting in higher interest income earned on marketable securities in the second quarter of 2024.

Previous wording

Other expense, net primarily consists of gains and losses from transactions denominated in a currency other than the functional currency.

Current wording

Other expense, net primarily consists of adjustments to non-marketable equity securities, including impairment, as well as gains and losses from transactions denominated in a currency other than the functional currency.

Previous wording

The provision for income taxes for the first quarter of 2024 decreased by $10 million, compared to the same quarter of 2023. The decrease was primarily attributable to full-year forecast variability as of the end of the first quarter. The provision for income taxes is primarily attributable to positive pre-tax book income in the United States resulting in federal and state income taxes.

Current wording

The provision for income taxes for the second quarter of 2024 was $1 million, compared to a benefit from income taxes of $9 million for the same quarter of 2023. The change was primarily attributable to variability in our quarterly and full-year forecasted pre-tax book income as of the end of the second quarter.

Previous wording

For additional information, see Note 9 - "Income Taxes" included in Part I, Item 1, "Financial Statements" of this Quarterly Report on Form 10-Q.

Current wording

For additional information, see Note 9 - "Income Taxes" included in Part I, Item 1, "Notes to Condensed Consolidated Financial Statements" of this Quarterly Report on Form 10-Q.

Previous wording

Flow to their respective related GAAP financial measures. We encourage investors and others to review our business, results of operations, and financial information in its entirety, not to rely on any single financial measure, and to view adjusted cost of revenue, adjusted sales and marketing expense, adjusted research and development expense, adjusted general and administrative expense, Contribution Profit, Contribution Margin, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, and Free Cash Flow in conjunction with their respective related GAAP financial measures.

Current wording

We compensate for these limitations by providing a reconciliation of adjusted cost of revenue, adjusted sales and marketing expense, adjusted research and development expense, adjusted general and administrative expense, Contribution Profit, Contribution Margin, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, and Free Cash Flow to their respective related GAAP financial measures. We encourage investors and others to review our business, results of operations, and financial information in its entirety, not to rely on any single financial measure, and to view adjusted cost of revenue, adjusted sales and marketing expense, adjusted research and development expense, adjusted general and administrative expense, Contribution Profit, Contribution Margin, Adjusted Gross Profit, Adjusted Gross Margin, Adjusted EBITDA, and Free Cash Flow in conjunction with their respective related GAAP financial measures.

Previous wording

(1)We exclude certain costs and expenses from our calculation of adjusted general and administrative expense because management believes that these costs and expenses are not indicative of our core operating performance, do not reflect the underlying economics of our business, and are not necessary to operate our business. These excluded costs and expenses consist of (i) certain legal costs primarily related to worker classification matters, as well as a settlement entered into in connection with an initiative to serve underrepresented communities, (ii) reserves and settlements or other resolutions for or related to the collection of sales, indirect, and other taxes that we do not expect to incur on a recurring basis, (iii) expenses related to supporting various policy matters, including those related to worker classification, other labor law matters, and price controls, and (iv) donations as part of our relief efforts in connection with the COVID-19 pandemic. We believe it is appropriate to exclude the foregoing matters from our calculation of adjusted general and administrative expense because (1) the timing and magnitude of such expenses are unpredictable and thus not part of management’s budgeting or forecasting process, and (2) with respect to worker classification matters, management currently expects such expenses will not be material to our results of operations over the long term as a result of increasing legislative and regulatory certainty in this area, including as a result of Proposition 22 in California and similar legislation.

Current wording

(1)We exclude certain costs and expenses from our calculation of adjusted general and administrative expense because management believes that these costs and expenses are not indicative of our core operating performance, do not reflect the underlying economics of our business, and are not necessary to operate our business. These excluded costs and expenses consist of (i) certain legal costs primarily related to worker classification matters, our historical Dasher pay model, and a settlement entered into in connection with an initiative to serve underrepresented communities, (ii) reserves and settlements or other resolutions for or related to the collection of sales, indirect, and other taxes that we do not expect to incur on a recurring basis, (iii) expenses related to supporting various policy matters, including those related to worker classification, other labor law matters, and price controls, and (iv) donations as part of our relief efforts in connection with the COVID-19 pandemic. We believe it is appropriate to exclude the foregoing matters from our calculation of adjusted general and administrative expense because (1) the timing and magnitude of such expenses are unpredictable and thus not part of management’s budgeting or forecasting process, and (2) with respect to worker classification matters, management currently expects such expenses will not be material to our results of operations over the long term as a result of increasing legislative and regulatory certainty in this area, including as a result of Proposition 22 in California and similar legislation.

Previous wording

(1)We exclude certain costs and expenses from our calculation of Adjusted EBITDA because management believes that these costs and expenses are not indicative of our core operating performance, do not reflect the underlying economics of our business, and are not necessary to operate our business. These excluded costs and expenses consist of (i) certain legal costs primarily related to worker classification matters, as well as a settlement entered into in connection with an initiative to serve underrepresented communities, (ii) reserves and settlements or other resolutions for or related to the collection of sales, indirect, and other taxes that we do not expect to incur on a recurring basis, (iii) expenses related to supporting various policy matters, including those related to worker classification, other labor law matters, and price controls, and (iv) donations as part of our relief efforts in connection with the COVID-19 pandemic. We believe it is appropriate to exclude the foregoing matters from our calculation of Adjusted EBITDA because (1) the timing and magnitude of such expenses are unpredictable and thus not part of management’s budgeting or forecasting process, and (2) with respect to worker classification matters, management currently expects such expenses will not be material to our results of operations over the long term as a result of increasing legislative and regulatory certainty in this area, including as a result of Proposition 22 in California and similar legislation.

Current wording

(1)We exclude certain costs and expenses from our calculation of Adjusted EBITDA because management believes that these costs and expenses are not indicative of our core operating performance, do not reflect the underlying economics of our business, and are not necessary to operate our business. These excluded costs and expenses consist of (i) certain legal costs primarily related to worker classification matters, our historical Dasher pay model, and a settlement entered into in connection with an initiative to serve underrepresented communities, (ii) reserves and settlements or other resolutions for or related to the collection of sales, indirect, and other taxes that we do not expect to incur on a recurring basis, (iii) expenses related to supporting various policy matters, including those related to worker classification, other labor law matters, and price controls, and (iv) donations as part of our relief efforts in connection with the COVID-19 pandemic. We believe it is appropriate to exclude the foregoing matters from our calculation of Adjusted EBITDA because (1) the timing and magnitude of such expenses are unpredictable and thus not part of management’s budgeting or forecasting process, and (2) with respect to worker classification matters, management currently expects such expenses will not be material to our results of operations over the long term as a result of increasing legislative and regulatory certainty in this area, including as a result of Proposition 22 in California and similar legislation.

Previous wording

As of March 31, 2024, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $5.1 billion, which consisted of cash and cash equivalents of $3.1 billion, short-term marketable securities of $1.4 billion, and long-term marketable securities of $646 million. Additionally, funds held at payment processors of $394 million represent cash due from our payment processors for cleared transactions with merchants and consumers, as well as funds remitted to payment processors for Dasher payout. Cash and cash equivalents consisted of cash on deposit with banks, as well as institutional money market funds, commercial paper, corporate bonds and U.S. Treasury securities. Marketable securities consisted of certificates of deposit, commercial paper, corporate bonds, U.S. government agency securities, and U.S. Treasury securities.

Current wording

As of June 30, 2024, our principal sources of liquidity were cash, cash equivalents, and marketable securities of $5.5 billion, which consisted of cash and cash equivalents of $3.4 billion, short-term marketable securities of $1.4 billion, and long-term marketable securities of $669 million. Additionally, funds held at payment processors of $396 million represent cash due from our payment processors for cleared transactions with merchants and consumers, as well as funds remitted to payment processors for Dasher payout. Cash and cash equivalents consisted of cash on deposit with banks, as well as institutional money market funds, commercial paper, corporate bonds and U.S. Treasury securities. Marketable securities consisted of certificates of deposit, commercial paper, corporate bonds, U.S. government agency securities, U.S. Treasury securities, and mutual funds.

Previous wording

We have generated significant operating losses from our operations as reflected in our accumulated deficit of $5.2 billion as of March 31, 2024. We have historically funded our operations from cash from operations as well as the issuance of equity securities, including in our initial public offering in December 2020. To execute on our strategic initiatives to continue to grow our business, we may incur operating losses and generate negative cash flows from operations in the future, and as a result, we may require additional capital resources. We believe our existing cash, cash equivalents, and marketable securities, along with the available borrowings under our revolving credit facility, will be sufficient to meet our working capital and capital expenditures needs for at least the next 12 months and beyond.

Current wording

We have generated significant operating losses from our operations as reflected in our accumulated deficit of $5.3 billion as of June 30, 2024. We have historically funded our operations from cash from operations as well as the issuance of equity securities, including in our initial public offering in December 2020. To execute on our strategic initiatives to continue to grow our business, we may incur operating losses and generate negative cash flows from operations in the future, and as a result, we may require additional capital resources. We believe our existing cash, cash equivalents, and marketable securities, along with the available borrowings under our revolving credit facility, will be sufficient to meet our working capital and capital expenditures needs for at least the next 12 months and beyond.

Previous wording

Cash provided by operating activities was $553 million for thefirst quarter of 2024. This consisted of a net loss including redeemable non-controlling interests of $25 million, offset by non-cash stock-based compensation expense of $252 million, non-cash depreciation and amortization expense of $142 million, non-cash reduction of operating lease right-of-use assets and accretion of operating lease liabilities of $26 million, and other net non-cash expenses of $14 million, as well as $144 million net inflows from changes in operating assets and liabilities primarily driven by an increase in accrued liabilities and other current liabilities.

Current wording

Cash provided by operating activities was $1,083 million for the firstsix months of 2024. This consisted of a net loss including redeemable non-controlling interests of $183 million, offset by non-cash stock-based compensation expense of $554 million, non-cash depreciation and amortization expense of $282 million, non-cash reduction of operating lease right-of-use assets and accretion of operating lease liabilities of $52 million, non-cash office lease impairment expenses of $83 million, and other net non-cash expenses of $41 million, as well as $254 million net inflows from changes in operating assets and liabilities primarily driven by an increase in accrued liabilities and other current liabilities.

Previous wording

Cash provided by operating activities was $397 million for thefirst quarter of 2023. This consisted of a net loss, including redeemable non-controlling interests, of $162 million, offset by non-cash stock-based compensation expense of $230 million, non-cash depreciation and amortization expense of $123 million, non-cash reduction of operating lease right-of-use assets and accretion of operating lease liabilities of $32 million, and other net non-cash expenses of $4 million, as well as $170 million net inflows from changes in operating assets and liabilities primarily driven by a decrease in our funds held at payment processors.

Current wording

$541 million, non-cash depreciation and amortization expense of $251 million, non-cash reduction of operating lease right-of-use assets and accretion of operating lease liabilities of $60 million, and other net non-cash expenses of $19 million, as well as $253 million net inflows from changes in operating assets and liabilities primarily driven by an increase in accrued liabilities and other current liabilities and a decrease in our funds held at payment processors.

Previous wording

Cash used in investing activities was $72 million for thefirst quarter of 2024, which primarily consisted of purchases of marketable securities of $529 million, purchases of property and equipment of $17 million, and cash outflows for capitalized software and website development costs of $49 million, partially offset by proceeds from maturities and sales of marketable securities of $532 million.

Current wording

Cash used in investing activities was $219 million for thefirst six months of 2024, which primarily consisted of purchases of marketable securities of $969 million, purchases of property and equipment of $40 million, and cash outflows for capitalized software and website development costs of $105 million, partially offset by proceeds from maturities and sales of marketable securities of $903 million.

Previous wording

Cash used in investing activities was $10 million for thefirst quarter of 2023, which primarily consisted of purchases of marketable securities of $434 million, purchases of property and equipment of $39 million, and cash outflows for capitalized software and website development costs of $42 million, partially offset by proceeds from maturities and sales of marketable securities of $506 million.

Current wording

Cash used in investing activities was $145 million for thefirst six months of 2023, which primarily consisted of purchases of marketable securities of $930 million, purchases of property and equipment of $66 million, and cash outflows for capitalized software and website development costs of $97 million, partially offset by proceeds from maturities and sales of marketable securities of $965 million.

Previous wording

Cash provided by financing activities was $7 million for thefirst quarter of 2024, which consisted of proceeds from exercise of stock options of $1 million and other financing activities of $6 million.

Current wording

Cash provided by financing activities was $2 million for thefirst six months of 2024, which consisted of proceeds from exercise of stock options of $3 million and other financing activities of $6 million, offset by repurchases of our Class A common stock of $7 million.

Previous wording

Cash used in financing activities was $390 million for thefirst quarter of 2023, which consisted of repurchases of Class A common stock of $392 million, partially offset by the proceeds from exercise of stock options of $2 million.

Current wording

Cash used in financing activities was $698 million for thefirst six months of 2023, which primarily consisted of repurchases of our Class A common stock of $693 million.