Financial Data and Key Metrics Changes - The company reported a Gross Transaction Value (GTV) growth of 11% year over year, driven by a 17% increase in orders, although the average order value decreased by 5% year over year [20][22] - GAAP net income reached $116 million, up 92% year over year, while adjusted EBITDA was $262 million, reflecting a 26% year over year increase [22][24] - Stock-based compensation increased to $105 million, up $39 million quarter over quarter, with expectations for a decrease in Q3 [23][24] Business Line Data and Key Metrics Changes - Advertising and other revenue grew by 12% year over year, remaining flat at 2.8% of GTV, indicating resilience despite a pullback from one of the largest brand partners [21][22] - The company has scaled advertising revenue to over $1 billion in annual run rate, increasing the number of active brand partners from 4,000 to over 7,500 [13][22] Market Data and Key Metrics Changes - The company continues to lead in share of sales among digital-first players, with its share being more than three times larger than the next competitor [11][12] - The company is seeing strong user growth and higher order frequency, particularly among new customers acquired in 2025 [8][31] Company Strategy and Development Direction - The company is focused on enhancing its interconnected ecosystem, which allows for scalable tools that help retailers innovate and compete [10][11] - The strategy includes deepening retail partnerships and expanding into new categories, such as alcohol and restaurant orders through partnerships like Uber Eats [30][31] - The company aims to maintain its leadership position by meeting customers' full grocery needs, particularly in the big basket segment [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's future, highlighting the strength of its operating model and the ability to deliver value for retailers and customers [13][25] - The leadership transition to Chris Rogers as the new CEO is seen as a positive step for the company's future growth [17][18] Other Important Information - The company has made strategic acquisitions to enhance its enterprise offerings and has repurchased over $1.6 billion worth of shares [15][24] - AI technology is integrated into the company's operations, with over 80% of code deployed in Q2 being AI-assisted [16] Q&A Session Summary Question: Competitive landscape and supply improvements - Management discussed the importance of onboarding more retailers and deepening existing partnerships to enhance supply and improve conversion rates [28][30] Question: Growth composition between grocery and restaurants - Management clarified that the addition of restaurant orders has contributed to overall order growth, with expectations for moderation in Q3 [34][36] Question: Interest in the Instacart platform and enterprise pipeline - Management highlighted the focus on Storefront Pro and the ability to upsell additional services to existing retailers [44][46] Question: CPG environment and advertising outlook - Management noted ongoing uncertainty in the CPG environment but emphasized the resilience of their advertising revenue and the potential for emerging brands to gain market share [52][56] Question: Affordability initiatives and customer retention - Management explained that their affordability strategy is broad-based and includes various initiatives to enhance customer retention and engagement [103][106]

Financial Data and Key Metrics Changes - The company reported a Gross Transaction Value (GTV) growth of 11% year over year, driven by a 17% increase in orders, despite a 5% decrease in average order value [18][20] - GAAP net income reached $116 million, up 92% year over year, while adjusted EBITDA was $262 million, reflecting a 26% year over year increase [20] - Stock-based compensation increased to $105 million, up $39 million quarter over quarter, with expectations for a decrease in Q3 [21] Business Line Data and Key Metrics Changes - Advertising and other revenue grew by 12% year over year, remaining flat at 2.8% of GTV, indicating resilience in the advertising platform [19][20] - The company has scaled advertising revenue to over $1 billion in annual run rate, increasing the number of active brand partners from 4,000 to over 7,500 [12] Market Data and Key Metrics Changes - The company continues to lead in share of sales among digital-first players, with its share being more than three times larger than the next competitor [10] - The company is onboarding new storefront partners at an accelerated pace, with 40 net new retailers added this year compared to 30 last year [28] Company Strategy and Development Direction - The company is focused on enhancing its interconnected ecosystem, which allows for scalable tools that help retailers innovate and compete [9] - The strategy includes deepening retail partnerships and expanding into new categories, such as alcohol and restaurant orders, to drive user growth and order frequency [28][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to remain a category leader despite competitive pressures, citing strong retention rates among new customers [12][29] - The company anticipates GTV for Q3 to range between $9 billion and $9.15 billion, reflecting year-over-year growth of 8% to 10% [22] Other Important Information - The company has made significant investments in AI, with over 80% of code deployed in Q2 being AI-assisted, which has improved operational efficiency [14] - The company has bought back over $1.6 billion worth of shares, demonstrating confidence in its execution capabilities [13] Q&A Session Summary Question: Comments on competitive landscape and consumer behavior - Management highlighted the importance of onboarding more retailers and deepening existing partnerships to drive growth and improve customer retention [27] Question: Composition of order growth between grocery and restaurants - Management noted that the addition of restaurant orders has contributed to higher order frequency, but they expect some moderation in growth as they lap the first full quarter of restaurant contributions [33][34] Question: Interest in the Instacart platform and enterprise pipeline - Management emphasized the focus on Storefront Pro and the ability to upsell additional services to existing retailers, indicating strong interest in their enterprise solutions [42][45] Question: Update on advertising revenue and CPG environment - Management acknowledged ongoing uncertainty in the CPG environment but noted that emerging brands are gaining share, which is beneficial for the advertising business [52][56] Question: Affordability initiatives and customer retention - Management clarified that their affordability strategy is broad-based and includes various initiatives beyond just lowering the minimum basket size, which has allowed for overall GTV growth [105] Question: Gains from batching and AI efficiency - Management discussed how gains from batching have allowed for reinvestment in customer incentives and operational efficiencies, with no immediate plans to impact OpEx from AI deployment [72][76]