Heavy Tech Spending Sends DoorDash Stock Crashing in After-Hours Trading

DoorDash announced ambitious plans to develop a global technology platform and introduce delivery robots next year. However, these initiatives come with hefty price tags, prompting concern among investors. The company's stock plummeted 9.8% in after-hours trading on 5 November 2025.

The US-based on-demand delivery service has expanded into Europe and Asia, operating multiple brands such as Wolt, each with its own technology stack. CEO Tony Xu sees this upgrade as essential for rolling out new features worldwide and maintaining competitive advantage.

Accelerating Orders and Revenue Growth

DoorDash has demonstrated consistent growth in Gross Order Value (GOV), which has increased steadily over the past five quarters. In fiscal Q3 2025 (ending 30 September), revenue rose 27% to $3.4 billion, while total orders increased 21% to $776 million, compared to the same period in 2024.

Net income under Generally Accepted Accounting Principles (GAAP) grew by 50.6% year-over-year to $244 million. The company's total marketplace GOV reached $25 billion. Notably, free cash flow stood at $723 million, up 62.8% from the previous year. However, expenses also increased, with costs rising 23% to $3.2 billion.

Following these strong results, DoorDash issued a statement justifying its planned investments: 'We wish there was a way to grow a baby into an adult without investment, or to see the baby grow into an adult overnight, but we do not believe this is how life or business works.'

Partnerships and Innovation Drive Future Growth

DoorDash has built its success through strategic partnerships, technological innovation, and logistics enhancements. The company is at the forefront of AI and robotics integration in food delivery.

One recent partnership is with Serve Robotics, a spinoff from Uber. Sidewalk robots are used to attract customers and fulfil orders efficiently. Additionally, DoorDash has developed Dot, an in-house delivery robot capable of navigating sidewalks, bike lanes, and roads.

On 2 October 2025, DoorDash announced the completion of its $3.9 billion cash acquisition of Deliveroo, a London-based food delivery firm operating in the UK, Belgium, France, Ireland, Italy, Singapore, and the Middle East. This move expands DoorDash's global reach and bolsters its competitive position.

Market Performance and Investor Sentiment

The online food delivery sector remains robust, reflected in DoorDash's impressive stock performance. The company's shares have delivered a 41.88% return in 2025, significantly outperforming the broader market. Over the past three years, DASH has achieved an extraordinary 361.5% return, marking it as a high-growth stock.

Despite this success, investors are growing cautious. The recent surge in large tech firms' investments raises concerns about potential overextension. While recent returns have been strong, future profitability could be threatened if investments do not deliver expected returns, impacting share value.

Looking Ahead: Investment Plans and Risks

While CEO Tony Xu did not specify exact figures, he confirmed that DoorDash's 2026 investment budget would be several hundred million dollars. The company aims to capitalise on emerging opportunities and accelerate innovation.

Xu stated, 'We are lucky that so many of our experiments are now ready for greater investment.' The focus will be on expanding global product development and boosting developer productivity through AI-native tools. Nonetheless, investors should carefully assess the risk-reward profile as DoorDash prepares to release its final strategic plan.

Disclaimer: Our digital media content is for informational purposes only and does not constitute investment advice. Please conduct your own analysis or seek professional guidance before investing. Remember, investments are subject to market risks, and past performance does not guarantee future results.