Instacart's $17 billion DoorDash deal comes with a long wait
A proposed sale puts a price on Instacart, but completion could take well over a year. Its latest results show stronger growth as shareholders enter the waiting period.
Instacart is heading toward a sale to DoorDash just as its grocery business is growing faster. The proposed deal values its equity at about $17 billion, but the companies do not expect to finish it until late 2027 or the first half of 2028.
That leaves shareholders with two questions: what they would receive, and how the business performs during a potentially long approval process.
The agreement, announced October 29, brings together Instacart's grocery shopping and retailer technology with DoorDash's local delivery network. DoorDash says it plans to keep Instacart's brand, app and enterprise technology products after completion. For now, the companies remain separate.
The payment choice has limits
The cash option is $65 for each Instacart share. The initial stock option is 0.3372 DoorDash Class A shares. A mixed option offers $48.75 in cash plus 0.08430 DoorDash shares. Under specified conditions, DoorDash can substitute Class C shares, with adjustments to the exchange ratios.
Those choices are subject to allocation rules. Across the deal as a whole, stock cannot exceed 25% of the consideration. If too many holders choose stock, part of their election would be paid in cash instead.
The stock option also carries exposure to DoorDash's share price. The announced $65 value should not be read as a guaranteed cash payment for every possible election.
DoorDash expects to fund the cash portion with existing cash and new borrowing, and has arranged a bridge financing commitment. The deal is not conditional on obtaining financing. It still needs Instacart shareholder approval and regulatory clearance, including in the United States, Canada and Israel.
The long timetable matters. Neither the announcement nor the financing commitment guarantees that the transaction will close. The merger agreement allows extensions of its initial deadline while antitrust conditions remain outstanding.
A stronger business enters the waiting period
Instacart's accompanying results show revenue rising 17% from a year earlier to $1.095 billion in the third quarter of 2026. Advertising and other revenue grew 23%, faster than transaction revenue.
The value of shopping and related charges flowing through the platform reached $10.528 billion. That figure, called gross transaction value, is much larger than Instacart's own revenue. It landed within the $10.300 billion to $10.550 billion range the company had forecast in August.
Adjusted EBITDA reached $342 million, slightly above the earlier $320 million to $340 million forecast. This profit measure excludes stock compensation, or pay awarded in shares, and several other costs. Reported net income rose much less, to $147 million from $144 million. Stock compensation increased to $120 million from $82 million.
The company also generated $324 million in cash from day-to-day operations and $307 million in free cash flow after investment in equipment and software. Those are quarterly figures.
Instacart has suspended its financial guidance and withdrawn its earlier long-term outlook because of the proposed acquisition. The immediate operating evidence is stronger growth and a small beat against its own adjusted profit forecast. The bigger unresolved issue is whether, and when, shareholders can turn the signed agreement into a completed sale.