DoorDash Shares Drop 10% as Focus on Growth Reinvestment Outweighs Earnings Outperformance

Shares of DoorDash (DASH) tumbled by more than 10% in after-hours trading on November 5, 2025, after the food delivery leader posted third-quarter results that fell short of expectations, even though revenue growth remained robust. The sharp decline reflected investor unease about management’s intention to boost spending in 2026 and a revised forecast for Deliveroo’s earnings impact, as reported by a

.

The company’s third-quarter revenue reached $3.45 billion, topping the consensus estimate of $3.36 billion, according to a

, fueled by a 25% year-over-year jump in marketplace gross order value (GOV) to $25.0 billion, as detailed in a . Total orders climbed 21% from a year earlier to 776 million, based on an , and adjusted EBITDA rose to $754 million, marking a 41% increase year-over-year, according to a . Still, earnings per share (EPS) were $0.55, falling short of the $0.68–$0.69 range projected in a .

The earnings shortfall was further impacted by management’s guidance for higher investment in 2026.

announced plans to allocate “several hundred million dollars more” next year toward platform enhancements and new projects, including AI-powered features, according to an . Alongside this, a new accounting approach for its recent Deliveroo acquisition lowered the UK delivery firm’s expected 2026 adjusted EBITDA contribution by $32–$40 million, as noted in a . Deliveroo is now anticipated to contribute $200 million to EBITDA in 2026, a figure that falls short of earlier projections in a .

Investor confidence weakened further after the company raised its Q4 2025 GOV forecast to $28.9–$29.5 billion but trimmed its adjusted EBITDA outlook to $710–$810 million, as highlighted in a

. Although the holiday quarter guidance surpassed analyst expectations, the increased spending plans overshadowed the positive trends. “We wish there was a way to grow a baby into an adult without investment,” DoorDash commented in its earnings statement, emphasizing the balance between immediate profits and future expansion.

Analysts responded quickly. Wells Fargo reduced its price target for

from $301 to $239, citing lower EBITDA projections for 2026. UBS and Stifel also cut their targets, but the stock maintained a “Moderate Buy” consensus among 31 analysts, with an average target price of $311.86. Despite the sell-off, DoorDash’s financial position remained solid, generating $723 million in free cash flow during the third quarter.

The share price drop followed a 42% gain since the start of the year, heightening sensitivity to profit-taking and concerns about reinvestment. The company’s upcoming earnings call at 5:00 p.m. ET on November 5 is expected to shape short-term trading, as investors look for more information on capital deployment, the integration of Deliveroo, and holiday season demand.

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