DoorDash Inc. (NYSE: DASH) today announced its financial results
for the quarter ended June 30, 2023. In addition to our financial
results below, our letter to shareholders is available on the
DoorDash investor relations website at http://ir.doordash.com.
Q2 2023 was our best quarter ever for Total Orders, Marketplace
GOV, and revenue. At the same time, we maintained our focus on
operational efficiency and disciplined expense management, which
drove an improvement to our Q2 2023 GAAP net loss including
redeemable non-controlling interests versus Q2 2022 and contributed
to all-time high Adjusted EBITDA. We are excited by our progress so
far in 2023 and are already hard at work building more features,
tools, and services that can improve local commerce.
Second Quarter 2023 Key Financial Metrics
- Total Orders increased 25% Y/Y to 532 million and Marketplace
GOV increased 26% Y/Y to $16.5 billion.
- Revenue increased 33% Y/Y to $2.1 billion and Net Revenue
Margin increased to 13.0% from 12.3% in Q2 2022.
- GAAP net loss including redeemable non-controlling interests
was $172 million compared to $263 million in Q2 2022, and Adjusted
EBITDA increased to $279 million from $103 million in Q2 2022.
Three Months Ended
(in millions, except percentages)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31,
2022
Mar. 31,
2023
Jun. 30, 2023
Total Orders
426
439
467
512
532
Total Orders Y/Y growth
23
%
27
%
27
%
27
%
25
%
Marketplace GOV
$
13,081
$
13,534
$
14,446
$
15,913
$
16,468
Marketplace GOV Y/Y growth
25
%
30
%
29
%
29
%
26
%
Revenue
$
1,608
$
1,701
$
1,818
$
2,035
$
2,133
Revenue Y/Y growth
30
%
33
%
40
%
40
%
33
%
Net Revenue Margin
12.3
%
12.6
%
12.6
%
12.8
%
13.0
%
GAAP Gross Profit
$
686
$
714
$
762
$
921
$
951
GAAP Gross Profit as a % of Marketplace
GOV
5.2
%
5.3
%
5.3
%
5.8
%
5.8
%
Contribution Profit
$
381
$
420
$
447
$
533
$
620
Contribution Profit as a % of Marketplace
GOV
2.9
%
3.1
%
3.1
%
3.3
%
3.8
%
GAAP Net Loss including redeemable
non-controlling interests
$
(263
)
$
(296
)
$
(642
)
$
(162
)
$
(172
)
GAAP Net Loss including redeemable
non-controlling interests as a % of Marketplace GOV
(2.0
)%
(2.2
)%
(4.4
)%
(1.0
)%
(1.0
)%
Adjusted EBITDA
$
103
$
87
$
117
$
204
$
279
Adjusted EBITDA as a % of Marketplace
GOV
0.8
%
0.6
%
0.8
%
1.3
%
1.7
%
Basic shares, options and RSUs outstanding
as of period end
448
446
452
444
449
Our Performance in Q2 2023
We focus on steadily improving the quality of experience we
offer to consumers, merchants, and Dashers. The cumulative impact
of these improvements, along with effective execution and durable
end markets, drove strong growth and improved efficiency in Q2
2023. On a reported basis in Q2 2023, we drove Total Orders up 25%
Y/Y, Marketplace GOV up 26% Y/Y, and revenue up 33% Y/Y. On a pro
forma basis in Q2 2023, including the results from Wolt for both
periods, we drove Total Orders up 18% Y/Y, Marketplace GOV up 20%
Y/Y, and revenue up 27% Y/Y.
On a pro forma basis, including the results from Wolt for both
periods, Y/Y growth in Total Orders accelerated slightly in Q2 2023
compared to Q1 2023, driven by stable Y/Y growth in our U.S.
restaurant marketplace, and accelerated Y/Y growth in our U.S.
non-restaurant categories and international markets. Our consumer
cohorts performed well in Q2 2023, which contributed to strong Y/Y
growth in MAU and drove order frequency to a new all-time high.
Based on third-party data, we believe we gained share in the U.S.
restaurant, U.S. convenience, and U.S. grocery categories, as well
as in many of our international markets during the quarter.
Total Orders from Platform Services grew modestly on a Y/Y basis
in Q2 2023. However, merchant demand for our services has remained
strong. We expect this to contribute to accelerated Y/Y growth in
Total Orders and revenue in Platform Services in the second half of
2023, as we anniversary the end of a large partnership.
In addition to strong growth in Total Orders and Marketplace GOV
in Q2 2023, improvements to logistics quality and efficiency and a
growing contribution from advertising helped drive revenue up 33%
Y/Y on a reported basis in Q2 2023 and up 27% Y/Y on a pro forma
basis, including the results from Wolt for both periods. Y/Y growth
in revenue was higher than Y/Y growth in Total Orders and
Marketplace GOV despite increased investment in consumer retention
and acquisition initiatives.
The combination of continued efficiency gains in our U.S.
restaurant marketplace and our key investment areas drove GAAP net
loss including redeemable non-controlling interests to $172 million
in Q2 2023 compared to a GAAP net loss including redeemable
non-controlling interests of $263 million in Q2 2022. Adjusted
EBITDA reached an all-time high in Q2 2023 of $279 million compared
to $103 million in Q2 2022.
GAAP sales and marketing expense increased to $471 million in Q2
2023, up 12% Y/Y and down 5% Q/Q. Dasher acquisition costs declined
on both a Y/Y and Q/Q basis in Q2 2023. Steady product improvements
have made dashing attractive to millions of people and helped
generate leverage in our sales and marketing expenses in recent
years. Although we continue to see room for further product
improvements over the long-term, Dasher acquisition costs were
lower than we expected in Q2 2023 and we do not expect the same
level of acquisition efficiency in the second half of 2023.
We continued to manage operating expenses with discipline in Q2
2023. Combined, GAAP research and development expenses and GAAP
general and administrative expenses were $610 million in Q2 2023,
up 23% from $496 million in Q2 2022, and up 18% from $516 million
in Q1 2023. We expect to remain disciplined in our management of
operating expenses in the remainder of 2023, with moderate growth
in headcount, most notably in research and development roles.
Operating cash flow in Q2 2023 was $393 million and Free Cash
Flow was $311 million. On a trailing 12-month basis, we generated
operating cash flow of $1.0 billion and Free Cash Flow of $653
million.
In February 2023, our board of directors authorized the
repurchase of up to $750 million shares of our Class A common
stock. To date, we have repurchased a total of 11.2 million shares
of our Class A common stock for $693 million under the February
authorization. Based on our current forecast for stock issuances,
we now expect net dilution in 2023 to be well under 1%, prior to
any additional potential stock repurchases. There is currently $57
million remaining under the current stock repurchase authorization.
We may or may not repurchase any portion of the remaining
amount.
Financial Outlook
Period
Marketplace GOV
Adj. EBITDA
Q3
$15.8 billion - $16.2 billion
$220 million - $270 million
2023
$64.2 billion - $65.2 billion
$750 million - $1.05 billion
Additionally, we currently expect stock-based compensation
expense for the second half of 2023 to be between $600 million and
$620 million. Detail around certain components of our stock based
compensation expense is included in the table at the end of this
press release.
Our outlook assumes that key foreign currency rates remain
relatively stable at current levels. Our outlook also anticipates
significant levels of ongoing investment in new categories and
international markets. We caution investors that consumer spending
in any of our geographies could deteriorate relative to our
outlook, which could drive results below our expectations.
Additionally, our increasing international exposure heightens risks
associated with operating in foreign markets, including
geopolitical and currency risks. Changes in the international
operating environment could negatively impact results versus our
current outlook.
We have not provided GAAP net loss outlook or a reconciliation
of Adjusted EBITDA to GAAP net loss as a result of the uncertainty
regarding, and the potential variability of, reconciling items such
as taxes and other items. Accordingly, a reconciliation of Adjusted
EBITDA to GAAP net loss is not available without unreasonable
effort. However, it is important to note that material changes to
reconciling items could have a significant effect on future GAAP
results. We have provided historical reconciliations of GAAP to
non-GAAP metrics in tables at the end of this release. For more
information regarding the non-GAAP financial measures discussed in
this release, please see "Non-GAAP Financial Measures" below.
Analyst and Investor Conference Call and Earnings
Webcast
DoorDash will host a conference call and webcast to discuss our
quarterly results today at 2:00 p.m. Pacific Time (5:00 p.m.
Eastern Time). Those interested in listening to the call can
register and attend by visiting our Investor Relations page at
https://ir.doordash.com. An archived webcast will be available on
our Investor Relations page shortly after the call.
Available Information
We announce material information to the public about us, our
products and services, and other matters through a variety of
means, including filings with the SEC, press releases, public
conference calls, webcasts, the investor relations section of our
website (ir.doordash.com), our blog (doordash.news), and our
Twitter account (@DoorDash) in order to achieve broad,
non-exclusionary distribution of information to the public and for
complying with our disclosure obligations under Regulation FD.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
which statements involve substantial risks and uncertainties.
Forward-looking statements generally relate to future events or our
future financial or operating performance. In some cases, you can
identify forward-looking statements because they contain words such
as “may,” “will,” “should,” “expect,” “plan,” “anticipate,”
“could,” “would,” “intend,” “target,” “project,” “contemplate,”
“believe,” “estimate,” "aim", "try", “predict,” “potential” or
“continue” or the negative of these words or other similar terms or
expressions that concern our expectations, strategy, plans, or
intentions. Forward-looking statements in this release include, but
are not limited to, our expectations regarding our financial
position and operating performance, including our outlook and
guidance for future periods, our expectations regarding the Wolt
business and our international business, our plans and expectations
regarding our investment approach, our ability to manage our
expenses, our expectations regarding our local commerce
opportunity, trends in our business, including the effect of the
macroeconomic environment, Dasher acquisition costs, consumer
spending, and demand for our platform and for local commerce
platforms in general, and our plans and expectations regarding
share dilution, including our share repurchase authorization, and
our ability to manage dilution. Our expectations and beliefs
regarding these matters may not materialize, and actual results in
future periods are subject to risks and uncertainties that could
cause actual results to differ materially from those projected,
including risks and uncertainties related to: competition, managing
our growth and corporate culture, financial performance, including
our ability to forecast our performance due to our limited
operating history, investments in new geographies, products, or
offerings, our ability to attract merchants, consumers, and Dashers
to our platform, legal proceedings and regulatory matters and
developments, any future changes to our business or our financial
or operating model, and our brand and reputation. The
forward-looking statements contained in this release are also
subject to other risks and uncertainties that could cause actual
results to differ from the results predicted, including those more
fully described in our filings with the SEC, including our Annual
Report on Form 10-K for the year ended December 31, 2022 and our
quarterly reports on Form 10-Q. All forward-looking statements in
this release are based on information available to DoorDash and
assumptions and beliefs as of the date hereof, and we disclaim any
obligation to update any forward-looking statements, except as
required by law.
Use of Non-GAAP Financial Measures
To supplement our financial information presented in accordance
with U.S. generally accepted accounting principles ("GAAP"), we
consider certain financial measures that are not prepared in
accordance with GAAP, including 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. We use these financial
measures in conjunction with GAAP measures as part of our overall
assessment of our performance, including the preparation of our
annual operating budget and quarterly forecasts, to evaluate the
effectiveness of our business strategies, and to communicate with
our board of directors concerning our business and financial
performance. We believe that these non-GAAP financial measures
provide useful information to investors about our business and
financial performance, enhance their overall understanding of our
past performance and future prospects, and allow for greater
transparency with respect to metrics used by our management in
their financial and operational decision making. We are presenting
these non-GAAP financial measures to assist investors in seeing our
business and financial performance through the eyes of management,
and because we believe that these non-GAAP financial measures
provide an additional tool for investors to use in comparing
results of operations of our business over multiple periods with
other companies in our industry.
We define adjusted cost of revenue as cost of revenue, exclusive
of depreciation and amortization, excluding stock-based
compensation expense and certain payroll tax expense, allocated
overhead, and inventory write off related to restructuring.
Allocated overhead is determined based on an allocation of shared
costs, such as facilities (including rent and utilities) and
information technology costs, among all departments based on
employee headcount. We define adjusted sales and marketing expense
as sales and marketing expenses excluding stock-based compensation
expense and certain payroll tax expense, and allocated overhead. We
define adjusted research and development expense as research and
development expenses excluding stock-based compensation expense and
certain payroll tax expense, and allocated overhead. We define
adjusted general and administrative expense as general and
administrative expenses excluding stock-based compensation expense
and certain payroll tax expense, certain legal, tax, and regulatory
settlements, reserves, and expenses, transaction-related costs
(primarily consists of acquisition, integration, and investment
related costs), impairment expenses, and including allocated
overhead from cost of revenue, sales and marketing, and research
and development.
We define Adjusted Gross Profit as gross profit plus (i)
depreciation and amortization expense related to cost of revenue,
(ii) stock-based compensation expense and certain payroll tax
expense included in cost of revenue, (iii) allocated overhead
included in cost of revenue, and (iv) inventory write off related
to restructuring. Gross profit is defined as revenue less (i) cost
of revenue, exclusive of depreciation and amortization and (ii)
depreciation and amortization related to cost of revenue. Adjusted
Gross Margin is defined as Adjusted Gross Profit as a percentage of
revenue for the same period.
We define Contribution Profit as our gross profit less sales and
marketing expense plus (i) depreciation and amortization expense
related to cost of revenue, (ii) stock-based compensation expense
and certain payroll tax expense included in cost of revenue and
sales and marketing expenses, (iii) allocated overhead included in
cost of revenue and sales and marketing expenses, and (iv)
inventory write off related to restructuring. We define gross
margin as gross profit as a percentage of revenue for the same
period and we define Contribution Margin as Contribution Profit) as
a percentage of revenue for the same period.
Adjusted EBITDA is a measure that we use to assess our operating
performance and the operating leverage in our business. We define
Adjusted EBITDA as net income (loss) including redeemable
non-controlling interests, adjusted to exclude (i) certain legal,
tax, and regulatory settlements, reserves, and expenses, (ii) loss
on disposal of property and equipment, (iii) transaction-related
costs (primarily consists of acquisition, integration, and
investment related costs), (iv) impairment expenses, (v)
restructuring charges, (vi) inventory write off related to
restructuring, (vii) provision for (benefit from) income taxes,
(viii) interest income, net, (ix) other expense, net, (x)
stock-based compensation expense and certain payroll tax expense,
and (xi) depreciation and amortization expense.
We define Free Cash Flow as cash flows from operating activities
less purchases of property and equipment and capitalized software
and website development costs.
We define Total Orders as all orders completed through our
marketplaces and platform services businesses over the period of
measurement.
We define Marketplace GOV as the total dollar value of orders
completed on our marketplaces, including taxes, tips, and any
applicable consumer fees, including membership fees related to
DashPass and Wolt+. Marketplace orders include orders completed
through Pickup and DoorDash for Work. 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.
We define Net Revenue Margin as revenue expressed as a
percentage of Marketplace GOV.
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 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
should be considered in addition to, not as substitutes for, or in
isolation from, measures prepared in accordance with GAAP.
DOORDASH, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In millions)
(Unaudited)
December 31,
2022
June 30, 2023
Assets
Current assets:
Cash and cash equivalents
$
1,977
$
1,904
Short-term marketable securities
1,544
1,552
Funds held at payment processors
441
297
Accounts receivable, net
400
383
Prepaid expenses and other current
assets
358
469
Total current assets
4,720
4,605
Long-term restricted cash
211
144
Long-term marketable securities
397
381
Operating lease right-of-use assets
436
417
Property and equipment, net
637
677
Intangible assets, net
765
708
Goodwill
2,370
2,396
Non-marketable equity securities
124
142
Other assets
129
131
Total assets
$
9,789
$
9,601
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable
$
157
$
173
Operating lease liabilities
55
58
Accrued expenses and other current
liabilities
2,332
2,495
Total current liabilities
2,544
2,726
Operating lease liabilities
456
440
Other liabilities
21
28
Total liabilities
3,021
3,194
Redeemable non-controlling interests
14
11
Stockholders’ equity:
Common stock
—
—
Additional paid-in capital
10,633
11,257
Accumulated other comprehensive (loss)
income
(33
)
9
Accumulated deficit
(3,846
)
(4,870
)
Total stockholders’ equity
6,754
6,396
Total liabilities, redeemable
non-controlling interests and stockholders’ equity
$
9,789
$
9,601
DOORDASH, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In millions, except share
amounts which are reflected in thousands, and per share
data)
(Unaudited)
Three Months Ended June
30,
Six Months Ended June
30,
2022
2023
2022
2023
Revenue
$
1,608
$
2,133
$
3,064
$
4,168
Costs and expenses:
Cost of revenue, exclusive of depreciation
and amortization shown separately below
880
1,135
1,643
2,204
Sales and marketing
421
471
835
967
Research and development
205
269
353
500
General and administrative
291
341
536
626
Depreciation and amortization
81
128
140
251
Restructuring charges
3
—
3
2
Total costs and expenses
1,881
2,344
3,510
4,550
Loss from operations
(273
)
(211
)
(446
)
(382
)
Interest income, net
4
34
5
61
Other income (expense), net
(3
)
(4
)
2
(5
)
Loss before income taxes
(272
)
(181
)
(439
)
(326
)
Provision for (benefit from) income
taxes
(9
)
(9
)
(9
)
8
Net loss including redeemable
non-controlling interests
(263
)
(172
)
(430
)
(334
)
Less: net loss attributable to redeemable
non-controlling interests
—
(2
)
—
(3
)
Net loss attributable to DoorDash, Inc.
common stockholders
$
(263
)
$
(170
)
$
(430
)
$
(331
)
Net loss per share attributable to
DoorDash, Inc. common stockholders, basic and diluted
$
(0.72
)
$
(0.44
)
$
(1.21
)
$
(0.85
)
Weighted-average number of shares
outstanding used to compute net loss per share attributable to
DoorDash, Inc. common stockholders, basic and diluted
363,961
388,737
356,630
389,563
DOORDASH, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
Six Months Ended June
30,
2022
2023
Cash flows from operating
activities
Net loss including redeemable
non-controlling interests
$
(430
)
$
(334
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization
140
251
Stock-based compensation
360
541
Reduction of operating lease right-of-use
assets and accretion of operating lease liabilities
35
60
Other
14
19
Changes in assets and liabilities, net of
assets acquired and liabilities assumed from acquisitions:
Funds held at payment processors
109
142
Accounts receivable, net
20
12
Prepaid expenses and other current
assets
(51
)
(27
)
Other assets
(44
)
(23
)
Accounts payable
38
20
Accrued expenses and other current
liabilities
(6
)
181
Payments for operating lease
liabilities
(32
)
(59
)
Other liabilities
(8
)
7
Net cash provided by operating
activities
145
790
Cash flows from investing
activities
Purchases of property and equipment
(77
)
(66
)
Capitalized software and website
development costs
(73
)
(97
)
Purchases of marketable securities
(1,078
)
(930
)
Maturities of marketable securities
992
962
Sales of marketable securities
245
3
Purchases of non-marketable equity
securities
—
(16
)
Net cash acquired in acquisitions
71
—
Other investing activities
—
(1
)
Net cash provided by (used in) investing
activities
80
(145
)
Cash flows from financing
activities
Proceeds from exercise of stock
options
8
3
Repurchase of common stock
—
(693
)
Other financing activities
—
(8
)
Net cash provided by (used in) financing
activities
8
(698
)
Foreign currency effect on cash, cash
equivalents, and restricted cash
(8
)
(2
)
Net increase (decrease) in cash, cash
equivalents, and restricted cash
225
(55
)
Cash, cash equivalents, and restricted
cash
Cash, cash equivalents, and restricted
cash, beginning of period
2,506
2,188
Cash, cash equivalents, and restricted
cash, end of period
$
2,731
$
2,133
Reconciliation of cash, cash
equivalents, and restricted cash to the condensed consolidated
balance sheets
Cash and cash equivalents
$
2,727
$
1,904
Restricted cash included in prepaid
expenses and other current assets
—
85
Long-term restricted cash
4
144
Total cash, cash equivalents, and
restricted cash
$
2,731
$
2,133
Non-cash investing and financing
activities
Purchases of property and equipment not
yet settled
$
39
$
20
Stock-based compensation included in
capitalized software and website development costs
$
66
$
80
DOORDASH, INC.
NON-GAAP FINANCIAL
MEASURES
(Unaudited)
Three Months Ended
(In millions)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31, 2022
Mar. 31,
2023
Jun. 30,
2023
Cost of revenue, exclusive of depreciation
and amortization
$
880
$
931
$
1,014
$
1,069
$
1,135
Adjusted to exclude the following:
Stock-based compensation expense and
certain payroll tax expense
(31
)
(29
)
(31
)
(24
)
(43
)
Allocated overhead
(8
)
(7
)
(8
)
(9
)
(8
)
Inventory write-off related to
restructuring
(2
)
—
—
—
—
Adjusted cost of revenue
$
839
$
895
$
975
$
1,036
$
1,084
Sales and marketing
$
421
$
418
$
429
$
496
$
471
Adjusted to exclude the following:
Stock-based compensation expense and
certain payroll tax expense
(29
)
(27
)
(28
)
(24
)
(36
)
Allocated overhead
(4
)
(5
)
(5
)
(6
)
(6
)
Adjusted sales and marketing
$
388
$
386
$
396
$
466
$
429
Research and development
$
205
$
226
$
250
$
231
$
269
Adjusted to exclude the following:
Stock-based compensation expense and
certain payroll tax expense
(95
)
(99
)
(116
)
(98
)
(134
)
Allocated overhead
(4
)
(5
)
(3
)
(4
)
(5
)
Adjusted research and development
$
106
$
122
$
131
$
129
$
130
General and administrative
$
291
$
311
$
300
$
285
$
341
Adjusted to exclude the following:
Stock-based compensation expense and
certain payroll tax expense
(76
)
(96
)
(93
)
(84
)
(99
)
Certain legal, tax, and regulatory
settlements, reserves, and expenses(1)
(15
)
(14
)
(19
)
(19
)
(49
)
Transaction-related costs(2)
(44
)
(7
)
(3
)
(1
)
(1
)
Impairment expenses(3)
—
—
(2
)
—
—
Allocated overhead from cost of revenue,
sales and marketing, and research and development
16
17
16
19
19
Adjusted general and administrative
$
172
$
211
$
199
$
200
$
211
(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, (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 and price controls, and (iv)
donations as part of our relief efforts in connection with the
COVID-19 pandemic and Russia's invasion of Ukraine. 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.
(2)
Consists of acquisition, integration, and
investment related costs, primarily related to Wolt
acquisition.
(3)
Consists of impairment expense related to
an operating lease right-of-use asset associated with our former
headquarters
Reconciliation of gross profit to Contribution Profit
Three Months Ended
(In millions, except percentages)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31,
2022
Mar. 31,
2023
Jun. 30,
2023
Revenue
$
1,608
$
1,701
$
1,818
$
2,035
$
2,133
Less: Cost of revenue, exclusive of
depreciation and amortization
(880
)
(931
)
(1,014
)
(1,069
)
(1,135
)
Less: Depreciation and amortization
related to cost of revenue
(42
)
(56
)
(42
)
(45
)
(47
)
Gross profit
$
686
$
714
$
762
$
921
$
951
Gross Margin
42.7
%
42.0
%
41.9
%
45.3
%
44.6
%
Less: Sales and marketing
$
(421
)
$
(418
)
$
(429
)
$
(496
)
$
(471
)
Add: Depreciation and amortization related
to cost of revenue
42
56
42
45
47
Add: Stock-based compensation expense and
certain payroll tax expense included in cost of revenue and sales
and marketing
60
56
59
48
79
Add: Allocated overhead included in cost
of revenue and sales and marketing
12
12
13
15
14
Add: Inventory write-off related to
restructuring
2
—
—
—
—
Contribution Profit
$
381
$
420
$
447
$
533
$
620
Contribution Margin
23.7
%
24.7
%
24.6
%
26.2
%
29.1
%
Reconciliation of gross profit to Adjusted Gross
Profit
Three Months Ended
(In millions, except percentages)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31,
2022
Mar. 31,
2023
Jun. 30,
2023
Gross profit
$
686
$
714
$
762
$
921
$
951
Add: Depreciation and amortization related
to cost of revenue
42
56
42
45
47
Add: Stock-based compensation expense and
certain payroll tax expense included in cost of revenue
31
29
31
24
43
Add: Allocated overhead included in cost
of revenue
8
7
8
9
8
Add: Inventory write-off related to
restructuring
2
—
—
—
—
Adjusted Gross Profit
$
769
$
806
$
843
$
999
$
1,049
Adjusted Gross Margin
47.8
%
47.4
%
46.4
%
49.1
%
49.2
%
Reconciliation of net loss including redeemable
non-controlling interests to Adjusted EBITDA
Three Months Ended
(In millions)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31,
2022
Mar. 31,
2023
Jun. 30,
2023
Net loss including redeemable
non-controlling interests
$
(263
)
$
(296
)
$
(642
)
$
(162
)
$
(172
)
Certain legal, tax, and regulatory
settlements, reserves, and expenses(1)
15
14
19
19
49
Transaction-related costs(2)
44
7
3
1
1
Restructuring charges
3
5
84
2
—
Inventory write-off related to
restructuring
2
—
—
—
—
Impairment expenses(3)
—
—
2
—
—
Provision for (benefit from) income
taxes
(9
)
(5
)
(17
)
17
(9
)
Interest income, net
(4
)
(9
)
(16
)
(27
)
(34
)
Other expense, net(4)
3
2
305
1
4
Stock-based compensation expense and
certain payroll tax expense(5)
231
251
268
230
312
Depreciation and amortization expense
81
118
111
123
128
Adjusted EBITDA
$
103
$
87
$
117
$
204
$
279
(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, (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 and price controls, and (iv) donations as
part of our relief efforts in connection with the COVID-19 pandemic
and Russia's invasion of Ukraine. 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.
(2)
Consists of acquisition, integration, and
investment related costs, primarily related to Wolt
acquisition.
(3)
Consists of impairment expense related to
an operating lease right-of-use asset associated with our former
headquarters.
(4)
Consists primarily of adjustments to
non-marketable equity securities, including impairment, for the
three months ended December 31, 2022.
(5)
Excludes stock-based compensation related
to restructuring, which is included in restructuring charges in the
table above.
Estimate of Certain Components of Stock Based Compensation
Expense
(in millions)
2022
2023
2024
2025
2026
2020 CEO performance award(1)
$
112
$
104
$
67
$
7
$
—
Wolt retention and revesting
93
150
146
141
54
Pre-IPO RSUs: amortization of stepped-up
value(2)
88
69
57
3
—
New hire, continuing employee, and other
grants
596
818 - 838
NA
NA
NA
Total stock based compensation
$
889
$
1,141 - 1,161
NA
NA
NA
(1)
In November 2020, our board of directors,
granted restricted stock units ("RSUs") to our Chief Executive
Officer, Tony Xu, covering 10,379,000 shares of our Class A common
stock, which we refer to here as the 2020 CEO Performance Award.
The award is intended to be the exclusive equity award to Mr. Xu
over a seven year performance period, which ends November 23, 2027.
The award has nine tranches that are eligible to vest based on the
achievement of stock price goals ranging from $187.60 to $501.00,
measured using an average of our stock price over a consecutive
180-day period during the performance period. For more information
on the 2020 CEO Performance Award, please refer to our annual proxy
statement.
(2)
Certain RSUs awarded prior to or around
the time of the our initial public offering have grant-date fair
values that significantly exceed the fair value of the awards
(“409A value”) prevailing at the time they were committed to
employees. The amounts included here represent the stock based
compensation associated with the excess amount of the grant-date
fair value over the 409A value.
Reconciliation of net cash provided by operating activities
to Free Cash Flow
Trailing Twelve Months
Ended
(in millions)
Jun. 30,
2022
Sept. 30,
2022
Dec. 31,
2022
Mar. 31,
2023
Jun. 30,
2023
Net cash provided by operating
activities
$
419
$
511
$
367
$
784
$
1,012
Purchases of property and equipment
(143
)
(166
)
(176
)
(183
)
(165
)
Capitalized software and website
development costs
(136
)
(154
)
(170
)
(173
)
(194
)
Free Cash Flow
$
140
$
191
$
21
$
428
$
653
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230802570320/en/
IR Contact: ir@doordash.com
PR Contact: press@doordash.com
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