Original title: A $17 billion deal nears: DoorDash (DASH.US) in talks to acquire Instacart and enter the grocery shopping arena, announcement could come as early as Thursday
Author: Zhitong Finance Lu Suo
Source: Zhitong Finance (智通财经)
Hero image source: pexels
Zhitong Finance APP learned that, according to media reports citing people familiar with the matter, DoorDash's plan to acquire Instacart could be announced as early as Thursday morning US Eastern time. Speculation about the deal has been heating up since last week, when The Information reported that Instacart was exploring a sale and had been in contact with companies such as Uber and DoorDash. On Monday, multiple media outlets reported that DoorDash was in advanced negotiations to acquire Instacart, in a deal that could value the company at around $17 billion.
In after-hours trading on Wednesday, Instacart shares rose about 4%, while DoorDash shares fell less than 1%. Instacart declined to comment. A representative for DoorDash did not immediately respond to requests for comment.
Acquiring Instacart would expand DoorDash's footprint in the online grocery delivery market. DoorDash, which started with restaurant food delivery, has gradually brought more retailers such as Sephora, Macy's, Staples, and Anthropologie onto its platform. After announcing a partnership with Kroger last year, DoorDash has in recent months added a growing number of regional grocery retailers.
Instacart went public in 2023 and was one of the biggest beneficiaries of the pandemic-era surge in demand for grocery delivery, but has since struggled to sustain that growth. In December, Instacart agreed to pay $60 million to settle a Federal Trade Commission case that included allegations of misleading users through deceptive advertising and using "illegal subscription registration" practices.
The service also faces intensifying competition from the likes of Amazon and Walmart. After slowing the expansion of its physical grocery business, Amazon has stepped up investment in online groceries, leveraging its vast fulfillment network to speed up delivery of household staples, everyday groceries, and perishables.
Both Amazon and Walmart have expanded same-day and next-day delivery, posing a threat to Instacart's on-demand delivery model.
Analysts note that, given the overlap between the two businesses, a potential combination of Instacart and DoorDash could draw antitrust scrutiny.
In a research note Monday, Wedbush analysts wrote that third-party delivery platforms "still account for a relatively small share of total grocery spending, but approval could prove more difficult if the online market is broken down further, or if the deal is viewed from the perspective of grocers as enterprise customers."
An M&A deal taking shape: DoorDash grabs for the gateway to household shopping
At the core of DoorDash's plan to acquire Instacart is extending the user entry point and delivery network built through restaurant food delivery into the much larger household and supermarket shopping scenario. The deal story began with Instacart exploring a sale and engaging potential buyers including Uber and DoorDash; by October 26, multiple media outlets reported that the two sides had entered advanced negotiations, with a potential deal value of about $17 billion.
DoorDash's strategic logic in pursuing Instacart is essentially to build on the user entry point and delivery network established by restaurant food delivery, deepen its layout in the "online selection, picking, and one-tap delivery" shopping scenario for household groceries, and expand its retailer technology services and advertising monetization space.
Shortly afterward, media citing people familiar with the matter reported that the acquisition could be announced as early as Thursday morning, October 29 US time — though this remains an expectation disclosed by sources, and does not mean the deal has been signed or completed.
Instacart's roughly 4% after-hours gain and DoorDash's sub-1% decline reflect the market starting to price the acquired company's deal premium on one side, and the acquisition costs and integration responsibilities the buyer may bear on the other. Meanwhile, the competitive backdrop drawing market focus is clear: Amazon and Walmart are continuously strengthening same-day and next-day delivery, competing for consumers' daily food and household purchases, and pushing independent delivery platforms to seek greater business scale and service depth.
One connects local consumption, the other goes deep into supermarket operations: the deal buys more than delivery orders
DoorDash's core business is a local commerce platform and on-demand delivery: consumers buy food, groceries, and other retail products through the platform, which connects merchants and couriers and monetizes through merchant commissions, consumer service fees, DashPass membership, and advertising, while offering merchants self-channel ordering, delivery, and operations tools.
Instacart, by contrast, goes deeper into the grocery retail system. Its business includes Instacart Marketplace, a consumer-facing supermarket shopping platform; Instacart Enterprise, an enterprise platform helping retailers run online stores and fulfillment; and Instacart Ads, an advertising business for consumer brands and retailers.
Supermarket orders involve large numbers of items, out-of-stock substitutions, fresh produce selection, and matching across different specifications — operational demands quite different from restaurant pickup and delivery. So what DoorDash values is not only Instacart's relationships with consumers and retailers, but also its product data, picking and fulfillment experience, and retail technology. Advertising deserves particular attention: Instacart has disclosed that advertising and other revenue exceeded $1 billion in 2025, meaning the potential acquisition target already possesses a significant monetization channel beyond delivery services.
If the deal closes, DoorDash could expand its consumer scenarios, deepen merchant services, and strengthen retail advertising capabilities. Restaurant users could be steered toward grocery shopping, and Instacart's household shoppers could add other local consumption; if membership benefits, customer acquisition spending, and fulfillment resources can be effectively coordinated, the platform could raise its share of consumer spending, lower repeat acquisition costs, and generate additional revenue from more transactions through advertising and merchant tools. That said, these are potential post-merger synergies — adding up orders does not directly equal higher profit.
Regulatory approval also affects deal value: per Wedbush's analysis, even if third-party delivery still accounts for a small share of overall grocery consumption, regulators could still find elevated concentration if they focus on the narrower online delivery market, or evaluate the deal from the perspective of retailers choosing technology and fulfillment providers. What truly matters for the deal is whether DoorDash can convert a broader consumer entry point into sustained profitability — not merely becoming a bigger delivery platform.
