DoorDash (DASH.US) splashes US$17 billion to acquire Instacart, accelerating its push to capture the U.S. grocery delivery market.

DoorDash (DASH.US)'s acquisition of Instacart has finally been settled. DoorDash said in a statement on Thursday that it has agreed to acquire Instacart at a valuation of approximately US$17 billion. DoorDash will pay consideration at US$65 per share in a cash-plus-stock deal. The transaction is the latest sign of continued consolidation in the increasingly competitive delivery market. Instacart went public in 2023 and was once one of the biggest beneficiaries of the pandemic-driven surge in demand for grocery delivery services, but it has since struggled to sustain that growth momentum. Meanwhile, competition has intensified as major rivals such as DoorDash and Uber Technologies, Inc. (UBER.US) expanded their businesses from restaurant delivery to other goods delivery, including groceries. For DoorDash, already the leading U.S. restaurant delivery app, acquiring Instacart will expand DoorDash's scale in the online grocery delivery market, a segment that CEO Tony Xu recently described as the company's fastest-growing business. DoorDash started with restaurant delivery and has since gradually brought more retailers onto its platform, including Sephora, Macy's, Inc., Staples and Anthropologie. Following its announced partnership with Kroger Co. last year, DoorDash has in recent months added an increasing number of regional grocery retailers. The deal will also help DoorDash better compete with retail giants such as Walmart Inc. (WMT.US) and Amazon.com, Inc. (AMZN.US), both of which have in recent years elevated online grocery orders to a more important strategic position. The broader delivery app sector has been consolidating continuously since the pandemic. During this period, DoorDash has carried out a series of acquisitions. In addition to acquiring U.K.-based Deliveroo, the company last year completed the acquisitions of hospitality technology company SevenRooms Inc. and ad-tech company Symbiosys. In September this year, DoorDash also agreed to acquire the campus dining business of smaller rival Grubhub. In addition, Instacart's higher-margin advertising business and back-end technology business will further strengthen DoorDash's recent efforts to provide enterprise-grade tools for offline dining and retailer ad management. Although transaction revenue still accounts for the majority of Instacart's total revenue, the company's advertising and enterprise businesses accounted for nearly 30% of revenue in the second quarter and are growing faster. Instacart's enterprise customers include Costco, which uses Instacart's technology to offer online ordering services in North America and parts of Europe. One connects local consumption, the other goes deep into supermarket operations: what's being bought is more than just delivery orders DoorDash's main business is a local commerce platform and on-demand delivery: consumers purchase food, groceries and other retail goods through the platform, and the company connects merchants with delivery workers, monetizing through merchant commissions, consumer service fees, DashPass membership and advertising, while also providing merchants with white-label ordering, delivery and operating tools. Instacart, by contrast, is more deeply embedded in the grocery retail system, with businesses including a consumer-facing grocery shopping platform (Instacart Marketplace), an enterprise platform that helps retailers operate online stores and fulfillment (Instacart Enterprise), and an advertising business serving consumer brands and retailers (Instacart Ads). Grocery orders involve a large number of products, out-of-stock substitutions, fresh produce selection and matching of different specifications, with operational requirements different from restaurant pickup and delivery; therefore, what DoorDash is eyeing includes not only Instacart's consumers and retailer partnerships, but also product data, picking and fulfillment experience and retail technology. Advertising deserves particular attention: Instacart disclosed that its advertising and other revenue exceeded US$1 billion in 2025, meaning the potential acquisition target already has an important monetization channel beyond delivery services. If the transaction is completed, DoorDash is expected to simultaneously expand consumption scenarios, deepen merchant services and enhance retail advertising capabilities. Restaurant users can be directed to grocery shopping, and Instacart's household purchasing users may also increase other local consumption; if membership benefits, customer acquisition spending and fulfillment resources can be effectively coordinated, the platform will have the opportunity to increase users' share of spending, reduce repeated customer acquisition costs, and allow more transactions to generate additional revenue through advertising and merchant tools. However, these are potential synergies after the merger, and for now orders cannot simply be added together to equate to increased profit. Regulatory approval also affects the value of the transaction: according to Wedbush's analysis, even if third-party delivery still accounts for a small share of overall grocery consumption, if regulators focus on a narrower online delivery market, or assess from the perspective of retailers choosing technology and fulfillment service providers, they may still find high concentration issues; the real main thread worth watching in the deal is whether DoorDash can convert a broader consumer entry point into sustained profitability, rather than simply becoming a larger delivery platform.