DoorDash Expands Grocery Footprint in Canada with Empire Partnership

What happened

DoorDash announced a major grocery expansion in Canada, adding over 1,000 Empire Company stores (Sobeys, Safeway, IGA, etc.) across 10 provinces. This is one of its largest grocery expansions, reflecting the fast-growing grocery category on its platform. The deal brings 12 grocery banners onto DoorDash, significantly increasing its Canadian non-restaurant selection. This aligns with management's goal to improve grocery/retail unit economics, which are expected to turn positive in 2H'26. However, near-term investment drag from platform integration and higher Dasher costs still looms, making it important to monitor margin progression.

Implication

The Empire partnership is a concrete step toward achieving the bull case scenario of improved grocery density and pick efficiency. If grocery/retail unit economics turn positive as guided by 2H'26, it could lift contribution profit and validate DoorDash's adjacency strategy. However, investors should be cautious: the stock still trades at 41x EV/EBITDA, and the expansion adds scale but also operational complexity and potential incentive costs. The key catalyst remains the 2H'26 margin step-up, and this news does not change the near-term investment drag. Patience is warranted until Q1'26 results demonstrate cost control and platform migration progress.

Thesis delta

The partnership reinforces the company's execution on grocery expansion, a key pillar of the bull case, but does not shift the WAIT rating; the investment thesis still hinges on observable margin inflection in 2H'26 and platform unification milestones.