DoorDash shares jumped as much as 14% in after-market trading Wednesday, despite reporting disappointing fourth-quarter earnings and offering cautious guidance for 2026, as CEO Tony Xu emphasized the company’s advantage over Amazon in the grocery delivery market: choice.
Amazon has been aggressively expanding its grocery delivery services, particularly for perishable items like produce and ice cream, announcing last month plans to extend same- and next-day delivery to more U.S. Cities and towns. This expansion initially impacted the stock prices of competitors like Instacart and DoorDash.
However, Xu argued on the company’s fourth-quarter earnings call that DoorDash differentiates itself by partnering with a variety of existing grocery chains, rather than relying on its own retail holdings like Amazon’s Whole Foods. DoorDash has expanded partnerships with Kroger and forged new agreements with regional chains, including Schnucks in the Midwest, according to the company.
“Consumers prefer choice,” Xu stated, predicting continued strong demand for DoorDash’s services. He noted that most shoppers frequent multiple grocery stores each week, particularly when seeking specific fresh products.
DoorDash is also extending its services to retailers through fulfillment initiatives like DashMarts, convenience store-sized spaces designed for efficient order picking and delivery. Xu said the company is “doing that for every single grocer so that they have the capability to compete against companies like Amazon.”
While DoorDash is widely recognized for restaurant deliveries, its gig workers are increasingly handling grocery orders, which often prove more financially viable for the company. Xu highlighted a trend of larger grocery orders from customers, beyond simple “fill-in” trips, a positive sign for the grocery industry where larger basket sizes typically yield higher profits for grocers. “People use us for both the quick runs as well as the stock-up use cases,” he said.
DoorDash’s Chief Financial Officer, Ravi Inukonda, indicated the company’s retail and grocery business is projected to achieve “unit-economic positive” results in the second half of 2026. The company’s stock had previously experienced a significant one-day decline in November following the announcement of plans to invest hundreds of millions of dollars in technological improvements.
