Good afternoon and thanks for joining us for our First Quarter 2022 Earnings Call. I'm pleased to be joined today by Co-Founder, Chair and CEO, Tony Xu; and CFO, Prabir Adarkar. We'd like to remind everyone that we'll be making forward-looking statements during this call, including our expectations of our business, financial position, operating performance, future results and guidance, our investment approach, strategy and statements regarding our acquisition of Wolt. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those described in forward-looking statements and some such risks are described in our risk factors included in our SEC filings, including Form 10-Ks and 10-Qs. You should not rely on our forward-looking statements as predictions of future events; we disclaim any obligation to update any forward-looking statements except as required by law. During this call, we will discuss certain non-GAAP financial measures, information regarding our non-GAAP financial results, including a reconciliation of such non-GAAP results to the most directly comparable GAAP financial measures may be found in our investor letter, which is available on our IR website. These non-GAAP measures should be considered in addition to our GAAP results and are not intended to be a substitute for our GAAP results. Finally, this call in its entirety is being audio webcast on our IR website; an audio replay of the call will be available on our site shortly after the call ends. As in previous quarters, we will go straight into the Q&A portion. So, with that, operator, please take the first question.

Your first question comes from the line of Ross Sandler from Barclays. Your line is open.

Hi, Tony, Prabir. I just had one high level and then one more near-term. So in the letter, I really liked how you laid out the philosophy around investing proceeds from the U.S. restaurant profit pools into these new areas with precision. And I think some folks on the line here are a little worried that after Wolt closes and that philosophy holds up, you're just going to have a lot more areas by which you can reinvest those profit pools across all of Europe. So can you just maybe talk about how that philosophy might change post-Wolt? And then the second question is based on the revenue margin and overall commentary on take rate, it looks like you're having no problems navigating supply and fuel inflation, doesn't seem to be an issue. But are there any noticeable changes from all the inflation out there on Dasher cost per order either kind of in the first quarter or anything we should expect looking ahead? Thanks a lot.

Hi, Ross, it's Tony. I'll take the first one and I'll let Prabir take the second one. So on the first one, I would say two parts. First is just our investment strategy with Wolt and secondly, just our investment philosophy in general. Our aspiration is to build the largest global local commerce business and we want to do that with building two assets. We want to build the largest local commerce marketplace where we're bringing everything inside the neighborhood to you, and we also want to build the largest local commerce platform where we're giving tools to the physical businesses so that they can each become their own digital powerhouses. That's really why we're excited about teaming up with Wolt because they share that same vision to build that truly global local commerce business as well. From our perspective, it's really going to take a similar investment philosophy in terms of how we've built everything else. In the investments shareholder letter, we gave an example of how we built effectively a new business from scratch in the last couple of years in the convenience category and outlined how we always start by first making sure that we build the best product possible especially in terms of retention and order frequency. We have a maniacal focus on the unit math to get the unit economics to work, and then we start considering efficient ways to actually scale that business. While we are aggressive in how we run these experiments to achieve those input outcomes, we're very disciplined about how we think about scaling these businesses. It's going to be no different as we think about the opportunity to team up with Wolt. We think the opportunity obviously is immense. I mean, if you look at this opportunity globally, in the restaurant category, in the U.S., we're even as the market leader only 6% of total restaurant industry sales. If you extend that into these other categories of restaurants or convenience, or retail, we're significantly smaller percentage. If we add in the countries now with Wolt, it gets us to a combined portfolio of about 26 countries, we're almost at an unnoticeable percentage. And then if you add on top of that the digitization that's happening on the merchants' websites and apps themselves, many of which we power through products like DoorDash Drive and Storefront, as well as other products, we're in the early ascendings, but the investment philosophy remains the same, where there is a maniacal focus on building the best-in-class products, a maniacal focus on being laser sharp on the unit math so that's actually positive before we scale globally.

Yes. Hey, Ross. And just to add to that point before I move on to the second part of your question. If you recall, when we announced Wolt, one of the things that we were excited about was the unit economics and the retention. So Wolt gives us a more efficient engine through which we can invest internationally. That's why what we had communicated was even after integrating Wolt, we expect our EBITDA expectations for the year to be materially unchanged because we're essentially redeploying capital that we would have deployed but till the Wolt engine, which is actually more efficient. So hopefully that gets to the crux of your question. On the supply question, we have not experienced supply shortages and we feel good about our supply position looking ahead. Some stats to share with you: our Dasher costs as a percentage of GOV were lower both quarter-on-quarter and year-on-year. Recall last year in Q1, we were undersupplied due to bad weather as well as fiscal stimulus, and we began investing over the course of last year, as well as this quarter frankly to continue to build a supply base where we can address the demand that we had anticipated. The second point, this is a little bit of a nuanced one. Our batch rates are down both quarter-on-quarter and year-on-year and my point to that is because in some occasions, if we find ourselves undersupplied, you may see batch rates go up. As a matter of fact, we actually had lower batch rates today than we did a year ago or even last quarter. The last point I'll make is our cost to acquire new Dashers; our cost to acquire renewed Dashers is the lowest it's been in the last four quarters. So all that to say, we feel really good from a supply standpoint not just because we invested in advance to address this demand but because we don't compete with rideshare for Dashers. This is a completely different pool of people.

Operator, next question.

Your next question comes from Youssef Squali from Truist Securities. Your line is open.

Thank you very much. I have a couple of questions. First, could you discuss how the Wolt business has been performing, even though the acquisition hasn't closed yet, especially regarding its geographic footprint and the impact of current challenges? Additionally, Tony, in your letter, you mentioned opportunities to increase contribution margin as a percentage of marketplace gross order value in the U.S. marketplace. Could you help us understand how much higher this could potentially go over the next year or two, as you need to allocate those funds for the new initiatives outlined in the letter? Thank you.

Thanks for the question, Youssef. So on the Wolt question specifically, the deal is on track to close in the second quarter. We can't comment on Wolt's performance before the deal is closed but in connection with the closing of the transaction, we'll provide more detail to come back to the street on specifics. So, stay tuned for that. Now, on your question on U.S. contribution margins, we haven't disclosed the exact contribution margin in the U.S. restaurant business, but let me try to answer your question in sort of qualitative terms. The first thing is that we have driven increasing margins in the U.S. restaurant business while growing categories there. The reason that's important is because it is easy to do one or the other, which is either grow margins or grow category share. There is remarkable progress that we've made in actually growing both. Looking into the future, there are multiple levers that are available to continue doing so without hurting growth. First, as we continue to drive up the efficiency of the logistics network, that will help our margin structure in the U.S. Second, as we improve the quality of the delivery experience, that will help with customer support costs as well as the refunds. Finally, there is leverage in certain parts of cost of sales as well as marketing which will help the margin structure. Beyond this, as our ads business scales, this is an incremental tailwind to the margin structure. All these things will come together to help the margins for the U.S. restaurant business grow and fund not just other initiatives, but reinvestment in the core U.S. restaurant business. Our objective is that we're not running the U.S. restaurant business to harvest margins. We're still investing in U.S. restaurants in order to build scale and continue to grow category share.

Your next question comes from the line of Steven Fox from Fox Advisors. Your line is open.

Hi, good afternoon. I was just wondering, since you mentioned the changes in unit economics for the convenience business and some of the other categories you're exploring, could you compare those unit economic trends using U.S. restaurants as a reference point and discuss how these new categories might differ as you aim to achieve optimal scale? Thank you.

Yes, it's important to remember that comparing these figures is like comparing a two-year-old to a ten-year-old, so it’s not a straightforward comparison. In just two years, the fact that we are on track to achieve breakeven unit economics in the third-party convenience business is quite impressive. Additionally, we are currently the leader in the convenience sector, and this progress has been made in a short time. Moving forward, we intend to continue improving our margins. I don't want to predict exactly where our margins will end up because there are many variables at play, and we are currently in the initial stages. We are approaching breakeven, and in the future, we will focus on enhancing our margins. Currently, most of our margin is generated from the U.S. restaurant business, while other areas are still developing. However, as these areas reach maturity, we expect to see increased profitability from them.

Your next question comes from the line of Lloyd Walmsley from UBS. Your line is open.

Great. I have two. First kind of sticking to the unit economic question. In the letter, you talked about convenience looking to generate a positive variable profit in the second half. Can you just help us contextualize that, and is this a big flip over the last year or so? And actually what do you see driving that flip to variable profit contribution in the second half? And then the second one, there were some press reports about slowing hiring at DoorDash recently. Is this accurate? Can you talk about what you're seeing causing you to slow hiring or maybe just shifting priorities ahead of Wolt? Anything you could share there would be great. Thanks.

Lloyd, maybe I'll take the first and Tony can take the second. So on the question around third-party convenience, you have to remember when we started this category, we knew there was demand for it because we saw what consumers were searching for, right? That demand got further amplified by COVID. But what we didn't fully appreciate is exactly how different and unique the sale is compared to restaurant. This is the learning curve we've been on that is now moving to profitability. Simple things like our Dashers need to go into stores to pick and pack. We need a different way to understand the inventory positions at the store and how do we guide the Dasher when they are inside the store. The basket sizes tend to be lower. This is where our operational execution, focus, and product focus have played a significant role because it allowed us to take this problem that looked unique to the restaurants and actually create products around it to make the math work even with lower basket sizes and picking and packing requirements. That's what I'd say. Now there is a lot more we can do in terms of for the cart up sales as well as other things including advertising to drive up the unit economics, and we're super early given that it's only two years old.

Yes. I think the only other thing I'd add before I take the question, Lloyd on hiring, is just, I think it's important to realize, especially when you're talking about the immense opportunity in something like convenience or grocery, which is a hundreds-of-billions-or-more, up to a trillion-dollar opportunity globally. It's a very long runway in terms of how we think about this. I was very impressed by how our teams were able to do all of the things that Prabir said and, on top of that, build a new catalog that is item-based, that has tens of thousands, hundreds of thousands of items per store instead of hundreds of items inside of a restaurant. We rebuilt search into an item-based experience first before a store-based experience. There's a lot of things that the team built, and they were able in parallel to move the unit economics. I think it's just a huge testament to the team in terms of the work that they did in both moving at the top and the bottom line of building a better product that customers would be using over and again and also making moves on the profitability front. On hiring, I guess the first thing I'd say is, you've got to be careful with what you read because it's probably either not in context or just not accurate. We're hiring at actually still very aggressive rates, multiples in fact of what I believe has been reported. But in general, let me talk a little bit about hiring maybe in the context of just our investment philosophy because it's very similar. If you look at the history of DoorDash or where we came from and maybe how we've enabled this continuous efficient process of inventing and growing the business, it really came from the fact that we had a lot of constraints early on. For the first six to six-and-a-half years of the business, we had a fraction of the financing of some of our peers. There was no ability to hire huge teams or spend a lot on marketing or anything on discounts or subsidies. We had to win by building a superior product, gain profitability the right way, not by doing unnatural things that hurt the customer experience but by doing the things that would increase selection, that would improve the service quality of our deliveries, that would offer more value in the form of DashPass and other programs and improve our customer support. All of these things led to industry-leading retention, which has yielded some of the numbers we've shown in the shareholder letter, all-time highs in our monthly active users even as thankfully customers are now returning back inside restaurants. All-time highs in our DashPass subscriber base, all-time highs in our order frequency across cohorts. Building the best product as well as gaining efficiencies from operations and the scale economies from marketing, that's really how the business has been built. When I apply that same investment philosophy towards something like hiring, it can't just be to hire aggressively. It has to also be to invest in systems of how we can reapply systems that we've built for one category and make that more effective into others.

Your next question comes from the line of Doug Anmuth from JPMorgan. Your line is open.

Thanks for taking the questions. I have two. First, I was just hoping you could talk about whether the inflationary pressures seen by your restaurant partners are changing the way they interact with and utilize DoorDash? And then second, also, maybe you could talk about the response from Dashers to the Dash Rewards Program and any commentary kind of framing how much that's costing you? Thank you.

Doug, maybe I'll start with the first here. Our average order values have increased slightly as a result of inflation. We obviously pass on a large portion of that to our merchants, so they benefit as well, given that they're experiencing price increases in the cost of the food. All else being equal, this would also have a positive impact on our margins. Now, the one thing I’ll say is the reality is we've seen food cost inflation for over a year now, right, the chicken prices and other things. It's hard to tell exactly what impact inflation has on order volume and in consumer engagement, specifically because we don’t have a counterfactual. Having said that, when we step back and look at the results in the quarter, the fact that monthly active users are at all-time highs, the fact that DashPass members are at all-time highs, and order frequency is at all-time highs speaks to the resiliency of the platform and the fact that the product has consistently gotten better in selection, quality, and affordability which leads to more consumer adoption, habituation, and increasing usage over time.

Yes. Doug, I think your question anticipated some behavior from merchants and Dashers. I would emphasize a few points. Inflation is certainly a concern, and we are addressing it seriously by prioritizing the needs of all our audiences. We have been fortunate to witness the resilience of the core U.S. restaurant business. Eating remains one of the largest and most frequent spending categories, with consumers dining three times a day, approximately 90 times a month. When considering other categories we now operate in, there are well over 100 shopping occasions each month. By building the largest marketplace with a retained and engaged user base, we enhance our chances of success despite inflationary pressures. Regarding our merchants, they continue to view DoorDash as a valuable sales channel, even as consumers return to dining in, which complements our delivery services. On the Dasher side, we understand that inflation is affecting their earnings, and we've taken steps to address this concern. Given our strong position with U.S. restaurants growing 250% over the last few years and increasing profitability, we decided to reinvest those profits to support all our audiences. We launched a couple of initiatives: one being a 10% cashback on fuel expenses and another a bonus program based on the distance Dashers drive. The response has been incredibly positive, with 90% of Dashers expressing enthusiasm for the benefits we've introduced.

Just to add a little more color to what Tony just described, Doug, we chose to absorb the costs of these Dasher benefits in order to preserve earnings. We could have chosen to pass on the costs to consumers, which would have had an impact on growth due to consumer price elasticity, but instead, we chose to absorb the program costs. Keeping consumer prices unchanged and ensuring Dasher earnings are preserved enables us to maximize growth because having adequate supply ensures the consumer quality is preserved which drives the growth flywheel in a slightly different way. Then there is the question of how do you fund it? As Tony pointed out, the U.S. restaurant business is very profitable, and we use the profits from this business for two things. First, to invest in new areas and second, to reinvest back in the core restaurant business. We are growing scale and generating growth in the core restaurant business. Historically, we have taken these efficiencies and used them to lower consumer prices, lower merchant commissions, and increase Dash earnings. Today, due to gas prices, there is a unique need for Dashers. Where we allocate more investment to help increase Dash earnings. If gas prices revert in the future, we will revisit that. So in short, absorbing these costs is essentially net neutral to our EBITDA expectations.

Your next question comes from the line of Michael McGovern from Bank of America. Your line is open.

Thanks for taking my question. I wanted to understand why Q1 '22 marked the largest quarter for new consumer acquisition since Q1 last year, even with lower sales and marketing as a percentage of revenue. What factors are contributing to this? Additionally, are these customers still mostly coming from the restaurant category, or are we seeing a trend of more first-time customers from non-restaurant segments? Thank you.

Yes. Thanks, Michael. Let me take this question. Yes, if you look back at Q1 '21, Q1 last year was elevated in terms of customer acquisition due to fiscal stimulus. Ignoring that quarter, if you look at every other quarter up to Q1 '22, we acquired more customers than we did. That just speaks to the fact that we're still under-penetrated in this category and there are more customers to be acquired. The last thing I'll say is that the majority of our business is the restaurant business, and so a lot of these customers join and place their first order in restaurants. However, we're seeing an interesting mix change now where we've got a number of customers joining to use some of our other categories, not just restaurants. It's too early since it's a small percentage, but over time as DoorDash gets known for being the destination for all things local commerce, the source of what product these customers use when they first join DoorDash will undoubtedly change.

Your next question comes from the line of Deepak Mathivanan from Wolfe. Your line is open.

Thank you for taking the questions. I have two inquiries. First, could you explain the factors behind the continuous frequency gains? DashPass adoption and non-food convenience categories are performing well, but how does this compare between subscribers and non-subscribers? As consumers return to pre-COVID routines, are there noticeable differences in order types regarding the timing of orders and basket sizes? Secondly, Prabir, could you clarify the impact of insurance reserves on first-quarter cost of revenues? Is this related to an accrual adjustment, or is there a change in the underlying unit economics? Thank you.

Yes. I'll take the first question, Deepak, and then Prabir will handle the question on insurance. The reasons for the frequency gains are really coming from the improvements in our product. Certainly, some of the order frequency gains came from increasing contributions from our DashPass subscriber base. But when you step back, a couple of points are still very important. One, dine-in and order and delivery are very complementary. In fact, we saw this at almost every phase of the pandemic. There were various geographies and parts of the world, including the U.S., where certain states reopened more aggressively than others where we saw that in the past couple of years and certainly in the first quarter of this year and even currently, people are not substituting eating in for eating out. The second point is we're constantly making improvements to the products. We're increasing the quality of the deliveries by maniacally addressing defects. We are improving affordability, part of which comes from DashPass, and we're continuously investing in customer support to ensure that we always delight customers and meet their increasing expectations. So that is really why our frequencies have grown.

And specifically on that Deepak, DashPass user order frequency has grown and we've also got an increase in mix toward DashPass. So those two things sort of act in concert with each other. It's a tough question to answer because we're continuing to see growth across cohorts. So let's take DashPass as an example, once a user joins DashPass, their order frequency continues to increase over time. This spread just continues to widen. So, I'm not trying to avoid the question, I’m just saying it’s an imprecise question. It would be a different story if these order frequencies remained static, but the reality is you've got growth taking place at the cohort level. On your question regarding insurance reserves, we experienced an increase in the average claim amount driven by the outsized impact of a few very large claims. As a result, we adjusted our reserves for both existing as well as future claims by 35 million, which had about a 30 basis point impact on cost of sales. Even though the insurance cost increased, it's a relatively small portion of our cost of sales, certainly compared to other line items like payment processing or customer support, and it’s lower than what you might see in rideshare. This has been a small area where we haven't focused on, but it represents an opportunity where we can control these costs in the long term. Lastly, we expect insurance costs to remain elevated in the near term because it takes a while for these changes to reflect in our claims data, but we’re going to manage within the EBITDA range.

Your next question comes from the line of Brian Nowak from Morgan Stanley. Your line is open.

Thanks for taking my questions, guys. I have two. The first one, Tony, I know you always put a maniacal focus on efficiency and improving the process. Maybe sort of qualitatively, can you talk to us about a couple of the biggest learning areas you still see room for improvement in the core U.S. restaurant delivery business? That's the first one. Then the second one, the point about the third-party convenience reaching positive variable contribution. Was that in line with what you thought at the start of the year or is that ahead of schedule? If it is ahead of schedule, any reason why we're not raising full-year EBITDA; is it too small, or are we going to reinvest? If we touched about that a little bit. Thanks.

Yes. Hi, Brian. There is still a large room to go in terms of finding more and more efficiency, and I think there are two general ways I think about this. The first is how do we find the next level of product-market fit, which would certainly grow our retention and order frequency even further, giving us even more leverage on sales and marketing, overall P&L. The second is really efficiency from operations. For example, the wait times we still see at stores, especially given some of the labor challenges you're seeing at restaurants or grocery stores or convenience stores, everyone in the service industry is feeling this. This makes wait times and inventory management have higher variance. Being able to manage that variance and lower wait times while improving inventory management are all areas we can improve. You can find efficiency in every line item. The two general approaches I see are building the next level of product so our consumers love it even more, which gives us lots of sales and marketing leverage, and finding efficiency on the cost front.

On the 3P convenience question, any profits we generated are being reinvested, and we try to drive scale and growth to maximize long-term profit dollars. We are running the business with the objective of maximizing scale, so that in the long term we maximize profit dollars. As Tony alluded to, these categories we're operating in are very large and under-penetrated today. That’s why we're investing to build scale. What we look for is a combination of strong signals of product-market fit as well as a path to attractive contribution margin. For example, if you look at our DashMart today, the most popular stores in terms of orders off the top 10 are the DashMarts. That's a signal of strong product-market fit because that's the customer speaking and we see that in the data. So we continue to see the right progress, whether it’s product-market fit or margin perspective, we’ll adjust accordingly. The intent right now is to reinvest profits, provided the right signals indicate, so we can drive growth for many years to come.

Your next question comes from the line of Eric Sheridan from Goldman Sachs. Your line is open.

Thanks for taking the questions. Two if I could. Tony, maybe a bigger picture question. Obviously you haven't been a public company for very long, and you see periods like this where valuation gets compressed very quickly, and capital becomes a little bit more constrained broadly in growth industries. How are you thinking about the capital you have on the balance sheet as elements of playing into maybe accelerated things more buy versus build decision and where you want to take the platform longer-term versus using capital as a sort of fortress to shore up and think about broader industry structures over the medium to long term? I'd love your perspective on that given the broader market environment we find ourselves in. And then maybe to ask one question a little bit differently. Given the current labor environment from delivery folks, do you see companies that have been more reluctant to maybe embrace platforms? Like you either wanting to partner directly with the platform or utilizing the drive? We've seen this in different hotel cycles with OTAs over the years where periods of demand or labor constraints can lead companies to make partnerships in digital. Could we see partners that have historically been reluctant to partner with you come back and think about platform dynamics to fulfill their business needs? Thanks.

Hey, Eric. Thanks for the questions. On the first one, I think the best way to always grow is from your own cash flows, right? We are in a very privileged position where we have a very cash-generating business in our U.S. restaurants marketplace that allows us to make most of our investments. We also have a cash balance north of $4 billion, which gives us quite a bit of flexibility. But it’s important to know when to use capital to your advantage, and when not to. To build businesses and products, we have to achieve product-market fit first, before we deploy capital to scale those businesses. I would argue we have to find product-market fit and then find efficient ways to grow that are unique to that product, and only then consider deploying capital to aggressively scale the business. From an inorganic perspective, I think the bar is just really high. M&A does not have a historical track record for success, and we keep that bar very high. We only consider it if it’s accretive to our business in terms of investing more efficiently into areas we find attractive, plus if we find a team that shares our values in building for the long haul. That is reflected in the example of Wolt, which is set to close in the first half of this year, where we saw they built a product that’s loved by their audience with an incredibly capital-efficient P&L across difficult geographies.

The second question was really around partnerships. Given the scale of our business, whether it’s the marketplace side or the platform side and the fleet we have, products such as Drive are getting more and more interesting, particularly in this era when the labor market is tight. Especially when it comes to delivery, everyone in the service industry is feeling this. More restaurants are reconsidering their reluctance toward partnering with us due to the reliability and capabilities we provide around same-day delivery. The successful drive as well as the greater secular shift toward convenience is leading to increased conversations with partners outside the restaurant category that are interested in embracing the same deployment.

Your next question comes from the line of Mark Mahaney from Evercore ISI. Your line is open.

Thanks. Could you provide your latest thoughts on ad revenue? I know it's still in the very early stages, but any updates on timing would be helpful. Additionally, regarding the average order frequency reaching a new high, could you share how significant the difference is between the average order frequency of new DashPass users and those who have been using DashPass for 6 months, 12 months, and so on? Understanding this gap could help us anticipate future usage trends. Thank you.

Sure. On ad revenue, we haven't disclosed the size of the business; it's still young and nascent, and there's a lot of room for growth. I would say it is an attractive opportunity for us, given the size of our user base, the frequency of interactions on our platform, as well as a number of surfaces available. We've mentioned that we’ve not rushed to monetize the ad space. Our focus is to balance delivering an appropriate return to advertisers with a positive consumer experience. It would be negative if consumer experience impacts conversions. Over the coming period, as this business scales, we will use these incremental profits for growth, in strengthening our core U.S. business as well as other initiatives beyond restaurants. On your question regarding order frequency, it’s a tough question to answer because we’re continuing to see growth across cohorts. Taking DashPass as an example, once a user joins DashPass, their order frequency has continued to increase, so that cohort just continues widening the spread. I’m not trying to avoid the question; it’s just an imprecise question.

Your next question comes from the line of Brian Fitzgerald from Wells Fargo. Your line is open.

Thanks, guys. A couple of quick ones. DashMarts are essentially micro-fulfillment centers. I think last time we checked, you were carrying around 2000 SKUs. Can you talk about the kind of trajectory of growth in terms of locations or SKU base that you're running a DashMart? And we just got back from marketing around Europe, and we got asked every meeting how's the U.S. North American consumer versus European. Looking at Wolt versus North America, any dynamics to call out there with respect to the strength or the price sensitivity of the consumer geographically?

Hey, Brian, it’s Tony. I’ll take the question on DashMart and then maybe Prabir can address the second question around geographic differences. On DashMart, the way I think about this is the problem to solve isn’t how many SKUs to offer inside of a DashMart or whether to build DashMart. The actual problem is how do we build the best convenience and grocery delivery experience? If you look at the penetration levels today compared to where they could be, the gap, especially in the U.S., is massive. Penetration levels in convenience and grocery are very low and have largely stagnated post-COVID. I think that suggests that the customer may prefer either buying online, picking up in store, or just shopping inside the store altogether. We’re trying to solve how we build an experience that delivers exactly what consumers ordered, at a price point matching expectations, accompanied by greater convenience. If we can figure that out, which requires lots of invention like inventory management and merchandising, then I think we can provide a service grocers and retailers will positively receive as they consider adding effectively another use case to their successful buy online, pick up in store use cases. We’re looking to optimize micro-fulfillment to achieve that.

On your international question, and I know there is an interest at Europe; just to provide a point of reference, I’m not sure the price sensitivity question is entirely fair. Outside the U.S., especially in countries excluding the UK, the penetration levels in food delivery are quite low, whether it's European countries or Australia or Japan. The reason for this is due to several factors, one being availability of restaurants and the second being selection problems. Additionally, the quality of experience is questionable; in many countries, food delivery is simply lead-generation. This means the restaurant fulfills the order, but consumers don’t have visibility into whether their order will be delivered or who to contact if issues arise, leading to poor experience and ultimately limited adoption. The opportunity exists as long as we address these fundamental building blocks of selection, quality, and affordability in these countries.

There are no further questions at this time. I'll turn the call back over to the DoorDash team.

Thank you, Joel, and thank you everybody for the questions and your time today. We look forward to being in touch with many of you soon. Have a good evening.

This concludes today's conference call. You may now disconnect.