Doordash Stock Climbs as Wall Street Bets on Future Payoff

Doordash shares gained nearly 2% Thursday, a reversal from an after-hours selloff, as analysts focused on long-term strategy over a disappointing quarterly report. The stock had initially dropped about 10% following fourth-quarter results that missed revenue and profit expectations, coupled with soft near-term guidance.

The company forecasts first-quarter earnings will be pressured by continued investment in its recent acquisition, British platform Deliveroo, alongside a $20 million hit from U.S. winter storms. Higher costs from expanding delivery ranges and operating in regulated markets also contributed to the cautious outlook.

Yet, the market's mood shifted toward optimism. In notes to clients, analysts pointed to early signs that Doordash's aggressive spending is beginning to yield results. Morgan Stanley's Brian Nowak cited strong, accelerating businesses and improving unit economics, which he said allows for "more durable growth" and continued investment. He expressed confidence in the core U.S. restaurant delivery service and noted growth in newer segments like retail, grocery, and international operations.

Bank of America's Justin Post stated the company is "executing well," suggesting the Deliveroo deal could ultimately double its global market opportunity.

This tempered reaction contrasts sharply with last quarter, when shares plunged after Doordash announced heavy spending on technology and innovations like autonomous delivery. Chief Financial Officer Ravi Inukonda told analysts Wednesday that the company is making significant progress on a major tech overhaul, with the bulk of that spending planned for this year. "We're being very disciplined," Inukonda said. "We're investing in areas where we're improving the products to ultimately drive both scale as well as profitability." Those investments include new warehousing strategies to position inventory closer to customers. The company also reported a record number of subscribers for the fourth quarter and for the full year 2025.

Source: CNBC