On-demand food delivery service DoorDash (NYSE: DASH) fell short of the market’s revenue expectations in Q1 CY2025, but sales rose 20.7% year on year to $3.03 billion. Its GAAP profit of $0.44 per share was 14.6% above analysts’ consensus estimates.
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DoorDash (DASH) Q1 CY2025 Highlights:
- Revenue: $3.03 billion vs analyst estimates of $3.10 billion (20.7% year-on-year growth, 2.1% miss)
- EPS (GAAP): $0.44 vs analyst estimates of $0.38 (14.6% beat)
- Adjusted EBITDA: $590 million vs analyst estimates of $588.6 million (19.5% margin, in line)
- EBITDA guidance for Q2 CY2025 is $625 million at the midpoint, below analyst estimates of $636.1 million
- Operating Margin: 5.1%, up from -2.4% in the same quarter last year
- Free Cash Flow Margin: 58.7%, up from 14.6% in the previous quarter
- Orders: 732 million, up 112 million year on year
- Market Capitalization: $87.04 billion
Company Overview
Founded by Stanford students with the intent to build “the local, on-demand FedEx", DoorDash (NYSE: DASH) operates an on-demand food delivery platform.
Sales Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last three years, DoorDash grew its sales at an exceptional 28.7% compounded annual growth rate. Its growth surpassed the average consumer internet company and shows its offerings resonate with customers, a great starting point for our analysis.
This quarter, DoorDash generated an excellent 20.7% year-on-year revenue growth rate, but its $3.03 billion of revenue fell short of Wall Street’s high expectations.
Looking ahead, sell-side analysts expect revenue to grow 19.6% over the next 12 months, a deceleration versus the last three years. We still think its growth trajectory is attractive given its scale and suggests the market is baking in success for its products and services.
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Orders
Request Growth
As a gig economy marketplace, DoorDash generates revenue growth by expanding the number of services on its platform (e.g. rides, deliveries, freelance jobs) and raising the commission fee from each service provided.
Over the last two years, DoorDash’s orders, a key performance metric for the company, increased by 21% annually to 732 million in the latest quarter. This growth rate is among the fastest of any consumer internet business and indicates its offerings have significant traction. 
In Q1, DoorDash added 112 million orders, leading to 18.1% year-on-year growth. The quarterly print was lower than its two-year result, suggesting its new initiatives aren’t accelerating request growth just yet.
Revenue Per Request
Average revenue per request (ARPR) is a critical metric to track because it measures how much the company earns in transaction fees from each request. This number also informs us about DoorDash’s take rate, which represents its pricing leverage over the ecosystem, or "cut" from each transaction.
DoorDash’s ARPR growth has been mediocre over the last two years, averaging 3.7%. This isn’t great, but the increase in orders is more relevant for assessing long-term business potential. We’ll monitor the situation closely; if DoorDash tries boosting ARPR by taking a more aggressive approach to monetization, it’s unclear whether requests can continue growing at the current pace. 
This quarter, DoorDash’s ARPR clocked in at $4.14. It grew by 2.2% year on year, slower than its request growth.
Key Takeaways from DoorDash’s Q1 Results
It was great to see DoorDash increase its number of requests this quarter. On the other hand, its revenue missed and its EBITDA guidance for next quarter fell short of Wall Street’s estimates. Overall, this was a softer quarter. The stock traded down 3.8% to $197.60 immediately following the results.
DoorDash underperformed this quarter, but does that create an opportunity to invest right now? We think that the latest quarter is only one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it’s free.
