Why Is DoorDash (DASH) Up 12.6% Since Last Earnings Report?

Core Viewpoint - DoorDash's recent earnings report shows mixed results, with revenue growth but earnings per share missing estimates, leading to questions about future performance as the stock has outperformed the S&P 500 recently [1]. Financial Performance - DoorDash reported Q3 2025 earnings of 55 cents per share, missing the Zacks Consensus Estimate by 19.12%, while revenues increased 27.3% year over year to $3.45 billion, beating the consensus mark by 2.41% [2]. - Total orders increased by 21% year over year to 776 million, surpassing the Zacks Consensus Estimate by 0.69% [3]. - Marketplace Gross Order Value (GOV) rose 25% year over year to $25 billion, exceeding the consensus mark by 1.84% [3]. - Adjusted gross profit was $1.81 billion, up 31.4% year over year, with an adjusted gross margin of 52.5%, an increase of 160 basis points [3]. Cost and Margin Analysis - The contribution margin improved to 36.8% from 34.4% in the previous year [4]. - Adjusted sales and marketing expenses rose 21.3% year over year to $542 million, while adjusted research and development expenses increased by 37.8% to $215 million [4]. - Adjusted EBITDA was $754 million, reflecting a 41.5% year-over-year increase, with an adjusted EBITDA margin expanding by 220 basis points to 21.9% [4]. Balance Sheet and Cash Flow - As of September 30, 2025, DoorDash had $8.32 billion in cash and cash equivalents, up from $7.74 billion as of June 30, 2025 [5]. - Cash flow from operations was $871 million in Q3, compared to $504 million in the previous quarter, with free cash flow at $723 million, up from $355 million [5]. Future Guidance - For Q4 2025, DoorDash anticipates Marketplace GOV to be between $28.9 billion and $29.5 billion, with adjusted EBITDA expected in the range of $710 million to $810 million [6]. - The company expects stock-based compensation expenses to be approximately $1.1 billion and depreciation and amortization expenses to be around $700 million for 2025 [6]. Market Sentiment and Estimates - Estimates for DoorDash have trended downward over the past month, with a consensus estimate shift of -19.89% [7][8]. - The stock currently holds a Zacks Rank of 3 (Hold), indicating an expectation of in-line returns in the coming months [10]. Industry Comparison - DoorDash operates within the Zacks Internet - Services industry, where competitor Zillow has seen a 4.5% gain over the past month, reporting revenues of $676 million, a year-over-year increase of 16.4% [11].