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On May 6, 2025, the online food ordering and delivery company DoorDash Inc. DASH reported Q1 earnings of $0.44 per share, beating the Zacks Consensus Estimate of $0.40 per share. This compares to a loss of $0.06 per share a year ago.
However, the company posted revenues of $3.03 billion in Q1, missing the Zacks Consensus Estimate by 1.96%. Sales rose 20% year over year. Meanwhile, the total value of orders placed on DoorDash's marketplace grew 20% year over year to $23.1 billion. That was ahead of estimates of $22.9 billion.
Apart from slightly lower-than-expected revenues, the company’s guidance came up as downbeat. DoorDash projected adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $625 million at the midpoint of its range. That was below the previous forecasts for adjusted EBITDA of $639 million, according to FactSet, as quoted on investors.com.
Due to mixed results, DASH shares slumped about 7.4% in the key trading session on May 6. Dash stock is up about 11.4% this year and has surged about 62% over the past year.
Flurry of Deals in Pipeline
Domestic Deal: DoorDash-SevenRooms
DoorDash is acquiring New York-based SevenRooms, a company that provides restaurants with tools for managing reservations, marketing and guest experiences, for $1.2 billion.SevenRooms’s best-in-class CRM and guest experience toolswill be integrated into DoorDash’s broader "Commerce Platform." The deal would allow DoorDash to offer merchants "new tools to grow in-store and delivery sales."
International Deal: Deliveroo Takeover
Meanwhile, British food delivery firm Deliveroo said it has agreed to a takeover offer from its American rival DoorDash that values the company at £2.9 billion ($3.9 billion). DoorDash, through its 2022 acquisition of Wolt, already operates in about 28 countries, mainly across Europe. The Deliveroo deal will create a combined company operating in over 40 countries.
Time to Buy the Dip in the Stock?
Analysts responded positively to DoorDash's planned acquisition of Deliveroo, noting limited market overlap between the two companies, which could ease regulatory concerns and enhance growth opportunities.
Deliveroo’s primary markets include the UK, Ireland, France, Belgium, Italy, Kuwait, Qatar, Singapore, and the UAE. DoorDash management emphasized the benefits of combining operational strengths with Deliveroo’s local market expertise to drive innovation and growth.
With UK stocks trading at a cheaper valuation, we believe the Deliveroo deal is well-timed. Note that the average company in the S&P 500 trades at 20 times its annual earnings (if we rule out highly valued tech giants like Alphabet, Apple and Microsoft from the equation). In contrast, FTSE 100 companies are valued at just 12 times earnings—less than half, as quoted on BBC.