Instacart Maplebear : Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

About this update from Maplebear Inc.

Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and related notes disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025. The following discussion contains forward-looking statements that are based on current plans, expectations and beliefs that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, those identified below and those discussed in the section titled "Risk Factors" and other sections, including the "Special Note Regarding Forward-Looking Statements" of this Quarterly Report on Form 10-Q. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. For purposes of clarity and ease of presentation, numbers presented within this section may not sum precisely to the totals provided. The underlying data used in the calculations, including percentages, is not rounded. Overview Instacart is the leading technology and enablement partner for the grocery industry - helping consumers save time, retailers run their businesses online and in-store, and connect brands with customers. We enable retail banners to grow by providing technology that can accelerate digital transformation of their business both online and in-store. Retailers reach customers through both Instacart Marketplace, where customers can shop from their favorite retailers through our app or website, and retailers' owned and operated online storefronts that are powered by Instacart Enterprise platform, our end-to-end technology solution encompassing ecommerce, fulfillment, Connected Stores, ads and marketing, and insights. When shopping for groceries, consumers want selection, quality, affordability, and convenience, and they shop in many different ways. Customers can place orders for delivery or pickup across a variety of use cases including the weekly shop, bulk stock-up, convenience, special occasions, from restaurants, and using our in-store technologies. We help our customers shop at their favorite retailers, order from their favorite restaurants, and enjoy selection, quality, affordability, and convenience. Our membership program, Instacart+, offers expanded customer benefits including unlimited $0 delivery fees on orders over a certain size, and other exclusive benefits. Instacart Ads offers brands a highly measurable ads offering that leverages first-party transaction data to move products off store shelves more efficiently. We provide discovery and attractive return on investment through our industry-leading advertising tools and insights purpose-built for the online grocery category. We offer shoppers an immediate, flexible earnings opportunity that allows them to choose when and how much to work. Shoppers are deeply valued members of the Instacart community, and we strive to make the shopping experience as seamless as possible so they can continue to deliver superior customer service. Macroeconomic Impacts Our business, financial condition, customer acquisition and retention, and key business metrics, including GTV and orders, may be impacted by macroeconomic trends affecting our markets and industry and consumer shopping habits, such as inflation and interest rate fluctuations, the effects of supply chain challenges, the impact of trade policies enacted or proposed by the United States, such as tariffs or other trade restrictions, and uncertainty related thereto, geopolitical conflicts, regulatory changes, uncertainty regarding an economic recession and its impact on consumer behavior, and the effects of severe weather patterns. Shopper Classification Developments The state of the law regarding independent contractor status of Instacart shoppers varies from jurisdiction to jurisdiction and among governmental agencies and is subject to change based on court decisions, administrative or agency determinations, new or changing regulations, and other legal and regulatory proceedings. Some jurisdictions have adopted, and may adopt in the future, regulations that impact whether we can or should classify shoppers as independent contractors. For example, Proposition 22 in California provides a framework that offers more legal certainty regarding the status of independent workers offering delivery services and entitles shoppers in California to certain pay standards and benefits, which increases costs for us to operate in California. However, there may continue to be legal challenges, or legislative or other attempts to amend or otherwise invalidate the benefits, protections, or independent worker status provided by Proposition 22. To date, no such challenges have been successful. Additionally, we may face allegations that certain of our business practices do not satisfy all the elements of Proposition 22. We also experience and expect to continue experiencing challenges to the independent contractor classification of shoppers who use Instacart in other jurisdictions in which we operate, as well as the imposition of additional requirements on the use of contractors. Any successful challenges, changes in law, or other legal uncertainty with respect to independent contractor classification, or requirements related to the use of contractors, may adversely impact our financial condition, business, and results of operations. For additional information about the risks to our business related to independent contractor classification, see the section titled "Risk Factors-Risks Related to Our Legal and Regulatory Environment-Our business is subject to various laws and regulations, which may change or increase over time and subject us to increased compliance costs and liabilities." Key Financial and Operational Highlights We use the following financial and key business metrics to help us evaluate the health of our business, identify trends affecting our performance, formulate business plans, and make strategic decisions: Three Months Ended March 31, 2025 2026 % Change (in millions, except percentages) GTV $ 9,122 $ 10,288 13 % Orders 83.2 91.2 10 % Revenue $ 897 $ 1,019 14 % Gross profit $ 671 $ 738 10 % Gross margin 75 % 72 % Gross profit as a percent of GTV 7.4 % 7.2 % Net income $ 106 $ 144 36 % Net income as a percent of revenue 12 % 14 % Net income as a percent of GTV 1.2 % 1.4 % Adjusted EBITDA (1) $ 244 $ 300 23 % Adjusted EBITDA margin (1) 27 % 29 % Adjusted EBITDA as a percent of GTV (1) 2.7 % 2.9 % Net cash provided by operating activities $ 298 $ 268 (10) % Free cash flow (1) $ 280 $ 253 (10) % ___________ (1) Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, Adjusted EBITDA margin, and free cash flow are non-GAAP financial measures. For more information regarding our use of these measures and reconciliation to the most directly comparable financial measures calculated in accordance with GAAP, see the section titled "-Non-GAAP Financial Measures." Orders We define an order as a completed customer transaction to purchase goods for delivery or pickup primarily from a single retailer through Instacart during the period indicated, including those completed through Instacart Marketplace or services that are part of the Instacart Enterprise platform. We believe that orders are an indicator of the scale and growth of our business as well as the value we bring to our constituents. In the first quarter of 2026, orders increased to 91.2 million, or 10% growth, compared to the same period of 2025, driven primarily by new customers and increased engagement of existing customers. Gross Transaction Value We define GTV as the value of the products sold through Instacart, including applicable taxes, deposits and other local fees, customer tips, which go directly to shoppers, customer fees, which include flat subscription fees related to Instacart+ that are charged monthly or annually, and other fees. GTV consists of orders including those completed through Instacart Marketplace or services that are part of the Instacart Enterprise platform. We believe that GTV indicates the health of our business, including our ability to drive revenue and profits, and the value we provide to our constituents. We have experienced and expect to continue to experience fluctuations in GTV growth, including due to the macroeconomic conditions described above, changes in customer and retailer engagement, and the effects of our strategic initiatives. In the first quarter of 2026, GTV increased to $10,288 million, or 13% growth, compared to the same period of 2025, primarily driven by the increase in orders and higher average order value. Gross Profit, Gross Margin, and Gross Profit as a Percent of GTV Gross profit is defined as revenue less cost of revenue, and gross margin is defined as gross profit as a percent of revenue. We believe that gross profit, gross margin, and gross profit as a percent of GTV are important indicators of the growth and efficiencies of our business. In the first quarter of 2026, gross profit increase d to $738 million , or 10% growth, compared to the same period of 2025, primarily driven by the increase in total revenue. Gross margin decreased by 2% to 72% in the first quarter of 2026, compared to the same period of 2025, primarily due to cost of revenue growing faster than revenue. Adjusted EBITDA, Adjusted EBITDA as a Percent of GTV, and Adjusted EBITDA Margin We define Adjusted EBITDA as net income (loss), adjusted to exclude (i) provision for (benefit from) income taxes, (ii) interest income, (iii) other (income) expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, net, (ix) acquisition-related expenses, and (x) restructuring charges. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue. For more information about how we use these non-GAAP financial measures in our business, the limitations of these measures, and reconciliations of these measures to the most directly comparable GAAP financial measures, see the section titled "-Non-GAAP Financial Measures." In the first quarter of 2026, Adjusted EBITDA increased to $300 million, or 23% growth, compared to the same period of 2025, primarily driven by a combination of strong GTV growth and operating leverage. Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin can vary significantly as we continue to make substantial investments to fuel our growth and scale our business. Free Cash Flow We define free cash flow as net cash provided by (used in) operating activities less purchases of property and equipment, including capitalized internal-use software. In the first quarter of 2026, free cash flow decreased to $253 million, or 10% , compared to the same period of 2025, primarily due to the collection of a large accounts receivable balance in the first quarter of 2025 from a retailer and the payment of $60 million in regulatory settlements in January 2026. Components of Results of Operations Revenue Our revenue consists of transaction revenue and advertising and other revenue. Transaction Revenue We generate transaction revenue primarily from: • end users, whom we refer to as customers, (i) through service and delivery fees paid for arranging fulfillment services from shoppers and (ii) for monthly or annual Instacart+ memberships, our membership program, which offers unlimited $0 delivery fees on orders over a certain size, and other exclusive benefits; • retailers (i) through service fees in exchange for connecting retailers with customers to facilitate transactions on Instacart Marketplace and (ii) fees related to fulfillment for orders placed through retailers' owned and operated online storefronts powered by Instacart Enterprise platform; and • revenue share agreements with third parties that supply payment cards to Instacart shoppers for in-store use. Transaction revenue is recognized upon transfer of control of services, net of the purchase value of the goods remitted to retailers and payments to shoppers for their services (including any shopper incentives), coupons, consumer incentives, and refunds. We expect transaction revenue from customer and retailer fees to fluctuate from time to time as a result of customer and retailer fee optimizations and changes in the mix of customer use cases and fulfillment options. We also expect the amounts of payments to shoppers, coupons, consumer and shopper incentives, and refunds to fluctuate over time depending on a number of factors. For example, implementation of additional fulfillment options, shifts in our ability to use shoppers, or regulatory changes related to our engagement of shoppers, as well as fulfillment efficiencies, such as changes in our batch rate, average time spent per order, shopper tenure, and shopper pay optimization, could result in fluctuations in our transaction revenue. In addition, periods of elevated customer demand have resulted in and can in the future result in increased shopper incentives and degradation of order quality due to higher rates of out of stock items and other delays, which in turn generally lead to more appeasement credits and refunds. Furthermore, our overall marketing strategy will impact the spend mix between activities that are recorded as reductions of revenue, such as promotions and consumer incentives, and activities that are recorded as sales and marketing expense, such as paid marketing and referrer credits. In certain cases, reductions of revenue can be more than fees received from retailers and customers. As a result of these factors, transaction revenue as a percent of GTV may fluctuate over time. Advertising and Other Revenue We primarily generate advertising and other revenue from: • the sale of advertising services to brands that are interested in reaching customers; and • certain partners for use of our software-as-a-service solution through Instacart Enterprise platform that enhances the omnichannel shopping experience, with revenue recognized over the subscription period as services are provided. Advertising revenue is recognized upon delivery of clicks, upon delivery of impressions, over the contract term on a fixed fee basis, or upon redemptions of coupons. For advertising arrangements that involve third parties, we record advertising revenue on a gross or net basis based on whether we act as a principal or agent in the transaction, which is assessed on a contract by contract basis. When we act as the principal and control the services provided to the brand partner, we record revenue on a gross basis, recognizing fees from the brand partner as revenue and related payments to the publisher as cost of revenue. When we act as an agent and do not control the services, we record revenue on a net basis, representing only the net amount received from the brand partner after payments to the publisher. Advertising and other revenue has historically been, and is expected to continue to be, seasonally high in the fourth quarter and seasonally low in the first quarter in a given year as a result of how advertisers deploy their budgets. In addition, we expect our advertising and other revenue growth rate and advertising and other investment rate (which we define as advertising and other revenue in a given period divided by GTV in such period) to continue to fluctuate, particularly during periods of acceleration or decreases in our GTV growth. We also expect advertising and other investment rate to fluctuate during periods in which we generate more GTV from sources where we do not provide advertising or where we have recently enabled advertising, such as from certain new offerings or use cases and from retailers' owned and operated online storefronts including those utilizing Instacart API that do not partner with Carrot Ads. We also expect our advertising and other revenue growth to fluctuate in the near term due to changes in brand partner spend, including as a result of the macroeconomic factors described above and in response to our GTV growth trends, which may occur on a delayed basis, as well as changes in the mix of revenue contribution from advertising contracts in effect in a particular period and related recognition of advertising revenue on a gross or net basis. Cost of Revenue Cost of revenue primarily consists of third-party payment processing fees, depreciation expense and amortization expense of capitalized internal-use software and technology-related intangible assets, hosting fees, insurance costs attributed to fulfillment, payments to publishers, and expenses related to cancellations. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense. We expect cost of revenue, exclusive of stock-based compensation expense, will increase on an absolute dollar basis and vary from period to period as a percent of revenue as we continue to grow our operations. Gross Profit and Gross Margin Gross profit represents revenue less cost of revenue. Gross margin is gross profit expressed as a percent of total revenue. Our gross margin has varied and will continue to vary from period to period based on a number of factors, including (1) changes in revenue mix, changes in the mix of order type due to changes in mix of use cases and fulfillment options, consumer shopping behaviors, average order values, customer fee optimization, and levels of consumer incentives, (2) operational efficiencies, (3) negotiations with our retail partners, third-party payment processors, publishers, and hosting providers, and (4) macroeconomic factors as discussed above. As we continue to expand across fulfillment options and consumer use cases, we also expect to incur additional types of costs, such as certain labor costs, that can impact both our cost of revenue and profitability trends in the future. Additionally, we expect fluctuations in transaction revenue and advertising and other revenue as described above. Operations and Support Expense Operations and support expense primarily consists of compensation costs for employees who support our operations, costs of customer and shopper support, costs to attract and onboard new shoppers, expenses related to software and subscriptions, and depreciation and amortization expense. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense. Operations and support expense, exclusive of stock-based compensation expense, may increase on an absolute dollar basis and vary from period to period as a percent of revenue and as a percent of GTV as we continue to invest in our operations and may hire additional employees, third-party consultants, and contractors to support our operations. Research and Development Expense Research and development expense primarily consists of compensation costs for our engineering employees, costs related to subscriptions and software, hosting fees attributed to research and development, third-party consulting fees, and depreciation and amortization expense. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense. Research and development expense, exclusive of stock-based compensation expense, may increase on an absolute dollar basis and vary from period to period as a percent of revenue and as a percent of GTV as we continue to invest in research and development activities relating to ongoing improvements to, and maintenance of, our offerings, including the hiring of engineering, product development, and design employees to support these efforts. Sales and Marketing Expense Sales and marketing expense primarily consists of advertising expenses, such as paid marketing, compensation costs for sales and marketing employees, third-party consulting fees, amortization expense of customer relationship intangible assets, and depreciation expense. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense. Sales and marketing expense, exclusive of stock-based compensation expense, may increase on an absolute dollar basis and vary as a percent of revenue, and as a percent of GTV as we continue to invest in sales and marketing to attract and increase the engagement of customers on Instacart and increase our brand awareness. While we expect sales and marketing expense to be one of our largest operating expenses for the foreseeable future, the trend and timing of our sales and marketing expense will depend in large part on the timing and magnitude of our marketing campaigns. General and Administrative Expense General and administrative expense primarily consists of compensation costs for administrative employees, including finance and accounting, human resources, policy, and legal; legal, regulatory, and policy expenses; third-party consulting fees; depreciation expense; amortization expense of patents and trademarks; and taxes. Compensation costs include salaries, taxes, benefits, bonuses, and stock-based compensation expense. General and administrative expense, exclusive of stock-based compensation expense, may increase on an absolute dollar basis and vary from period to period as a percent of revenue and as a percent of GTV as we continue to invest in processes, systems, and controls to enable our internal support functions to scale with the growth of our business. Other Income (Expense), Net Other income (expense), net primarily consists of gains and losses from transactions denominated in a currency other than the functional currency. Interest Income Interest income consists primarily of interest earned on our cash and cash equivalents, restricted cash and cash equivalents, and marketable securities. Provision for (Benefit from) Income Taxes The provision for (benefit from) income taxes consists primarily of income taxes in certain federal, state, local, and foreign jurisdictions in which we conduct business. Our provision for (benefit from) income taxes differs from the U.S. federal statutory income tax rate primarily due to the tax effects of stock-based compensation recognized, federal and California research and development credits generated, and the income taxes generated in U.S. states and foreign jurisdictions. Our future effective income tax rate depends on various factors, such as changes in tax laws, regulations, accounting principles, or interpretations thereof, and the geographic composition of our pre-tax income. Results of Operations The following table summarizes our results of operations for the periods indicated: Three Months Ended March 31, 2025 2026 (in millions) Revenue $ 897 $ 1,019 Cost of revenue (1)(2) 226 281 Gross profit 671 738 Operating expenses: Operations and support (1)(2) 75 74 Research and development (1)(2) 144 164 Sales and marketing (1)(2) 216 230 General and administrative (1)(2) 126 88 Total operating expenses 561 556 Income from operations 110 182 Interest income 14 6 Income before provision for income taxes 124 188 Provision for income taxes 18 44 Net income $ 106 $ 144 ___________ (1) Amounts include depreciation and amortization expense as follows: Three Months Ended March 31, 2025 2026 (in millions) Cost of revenue $ 14 $ 24 Operations and support - 1 Research and development 2 2 Sales and marketing 2 2 General and administrative 1 1 Total depreciation and amortization expense $ 19 $ 30 (2) Amounts include stock-based compensation expense as follows: Three Months Ended March 31, 2025 2026 (in millions) Cost of revenue $ 2 $ 2 Operations and support 3 3 Research and development 34 46 Sales and marketing 13 10 General and administrative 14 19 Total stock-based compensation expense $ 66 $ 80 The following table summarizes the components of our condensed consolidated statements of operations data, for each of the periods presented, as a percent of revenue. Three Months Ended March 31, 2025 2026 (as a percent of revenue) Revenue 100 % 100 % Cost of revenue 25 28 Gross profit 75 72 Operating expenses: Operations and support 8 7 Research and development 16 16 Sales and marketing 24 23 General and administrative 14 9 Total operating expenses 63 55 Income from operations 12 18 Interest income 2 1 Income before provision for income taxes 14 18 Provision for income taxes 2 4 Net income 12 % 14 % Comparison of the Three Months Ended March 31, 2025 and 2026 Revenue Three Months Ended March 31, 2025 2026 $ Change % Change (in millions) Transaction $ 650 $ 733 $ 82 13 % Advertising and other 247 286 40 16 % Total revenue $ 897 $ 1,019 $ 122 14 % The increase in transaction revenue during the first quarter of 2026, compared to the same period of 2025, was primarily driven by growth in GTV, which grew 13%, and increased fulfillment efficiencies , partially offset by lower payment revenue. The increase in advertising and other revenue during the first quarter of 2026, compared to the same period of 2025, was primarily driven by interrelated factors including an increase in advertising volume, activity on our platform, and strength from emerging and mid-size brand partners. Advertising and other investment rate increased by 8 basis points to 2.8% during the first quarter of 2026, compared to the same period of 2025, as advertising and other revenue grew faster than GTV. Cost of Revenue, Gross Profit, and Gross Margin Three Months Ended March 31, 2025 2026 $ Change % Change (in millions, except percentages) Cost of revenue $ 226 $ 281 $ 55 24 % Gross profit $ 671 $ 738 $ 66 10 % Gross margin 75 % 72 % The increase in cost of revenue during the first quarter of 2026, compared to the same period of 2025, was primarily due to an increase of $16 million in credit card processing fees, an increase of $12 million in payments to publishers, and an increase of $10 million in depreciation and amortization expense, primarily related to capitalized internal-use software. The increase in gross profit during the first quarter of 2026, compared to the same period of 2025, was primarily driven by the increase in total revenue due to the factors described above. The decrease in gross margin during the first quarter of 2026, compared to the same period of 2025, was primarily due to cost of revenue growing faster than revenue . Operations and Support Expense Three Months Ended March 31, 2025 2026 $ Change % Change (in millions, except percentages) Operations and support $ 75 $ 74 $ (1) (1) % Percent of revenue 8 % 7 % The decrease in operations and support expense during the first quarter of 2026, compared to the same period in 2025, was immaterial. Research and Development Expense Three Months Ended March 31, 2025 2026 $ Change % Change (in millions, except percentages) Research and development $ 144 $ 164 $ 20 14 % Percent of revenue 16 % 16 % The increase in research and development expense during the first quarter of 2026, compared to the same period in 2025, was primarily due to a net increase of $13 million in total compensation costs. Sales and Marketing Expense Three Months Ended March 31, 2025 2026 $ Change % Change (in millions, except percentages) Sales and marketing $ 216 $ 230 $ 14 6 % Percent of revenue 24 % 23 % The increase in sales and marketing expense during the first quarter of 2026, compared to the same period in 2025, was primarily due to an increase of $10 million in marketing costs, primarily from increased paid marketing. General and Administrative Expense Three Months Ended March 31, 2025 2026 $ Change % Change (in millions, except percentages) General and administrative $ 126 $ 88 $ (38) (30) % Percent of revenue 14 % 9 % The decrease in general and administrative expense during the first quarter of 2026, compared to the same period of 2025, was primarily due to a decrease of $46 million in accruals for legal matters and sales and indirect taxes. Interest Income Three Months Ended March 31, 2025 2026 $ Change % Change (in millions) Interest income $ 14 $ 6 $ (8) (58) % The decrease in interest income during the first quarter of 2026, compared to the same period of 2025, was primarily due to lower interest rates and a reduction in the average balance of our cash, cash equivalents, and marketable securities. Provision for Income Taxes Three Months Ended March 31, 2025 2026 $ Change % Change (in millions) Provision for income taxes $ 18 $ 44 $ 26 148 % The increase in the provision for income taxes during the first quarter of 2026, compared to the same period of 2025, was due to the tax effects of stock-based compensation recognized, U.S. research and development credits generated, and the income taxes generated in U.S. states and foreign jurisdictions. Non-GAAP Financial Measures To supplement our condensed consolidated financial statements prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to facilitate analysis of our financial and business trends and for internal planning and forecasting purposes. We use Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, Adjusted EBITDA margin, adjusted cost of revenue, adjusted cost of revenue as a percent of GTV, adjusted operations and support expense, adjusted operations and support expense as a percent of GTV, adjusted research and development expense, adjusted research and development expense as a percent of GTV, adjusted sales and marketing expense, adjusted sales and marketing expense as a percent of GTV, adjusted general and administrative expense, adjusted general and administrative expense as a percent of GTV, adjusted total operating expenses, adjusted total operating expenses as a percent of GTV, and free cash flow (collectively "Non-GAAP Measures") in conjunction with GAAP measures to assess performance, to inform the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies, and to discuss our business and financial performance with our board of directors. We believe that these Non-GAAP Measures provide useful information to investors about our business and financial performance, enhance their overall understanding of our past performance and future prospects, and allow for greater transparency with respect to metrics used by our management in their financial and operational decision making. We are presenting these Non-GAAP Measures to assist investors in seeing our business and financial performance through the eyes of management, and because we believe that these Non-GAAP Measures provide an additional tool for investors to use in comparing results of operations of our business over multiple periods with other companies in our industry. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated statements of operations prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies, which reduce their usefulness as comparative measures. In addition, other companies may not publish these or similar measures. Further, these measures have certain limitations in that they do not include the impact of certain expenses that are reflected in our condensed consolidated statements of operations. We encourage investors and others to review our business, results of operations, and financial information in their entirety, not to rely on any single financial measure, and carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Adjusted EBITDA, Adjusted EBITDA as a Percent of GTV, and Adjusted EBITDA Margin We define Adjusted EBITDA as net income (loss), adjusted to exclude (i) provision for (benefit from) income taxes, (ii) interest income, (iii) other (income) expense, net, (iv) depreciation and amortization expense, (v) stock-based compensation expense, (vi) payroll taxes related to stock-based compensation, (vii) certain legal and regulatory accruals and settlements, net, (viii) reserves for sales and other indirect taxes, net, (ix) acquisition-related expenses, and (x) restructuring charges. We define Adjusted EBITDA margin as Adjusted EBITDA as a percent of revenue. We include Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin in this Quarterly Report on Form 10-Q because they are important measures upon which our management assesses our operating performance and the operating leverage in our business. Because Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin facilitate internal comparisons of our historical operating performance, including as an indication of our revenue growth and operating efficiencies when compared to GTV and revenue over time, we use them to evaluate the effectiveness of our strategic initiatives and for business planning purposes. We also believe that Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin, when taken collectively, may be useful to investors because they provide consistency and comparability with past financial performance, so that investors can evaluate our operating efficiencies by excluding certain items that may not be indicative of our business, results of operations, or outlook. In addition, we believe Adjusted EBITDA is widely used by investors, securities analysts, rating agencies, and other parties in evaluating companies in our industry as a measure of operational performance. Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin should not be considered as alternatives to net income (loss), net income (loss) as a percent of GTV, net income (loss) as a percent of revenue, or any other measure of financial performance calculated and presented in accordance with GAAP. There are a number of limitations related to the use of Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin rather than net income (loss), net income (loss) as a percent of GTV, and net income (loss) as a percent of revenue, which are the most directly comparable GAAP measures. Some of these limitations are that each of Adjusted EBITDA, Adjusted EBITDA as a percent of GTV, and Adjusted EBITDA margin: • does not reflect provision for or benefit from income taxes that reduces or increases cash available to us. • does not reflect interest income which increases cash available to us; • does not reflect other income or expense that includes unrealized and realized gains and losses on foreign currency exchange; and • excludes depreciation and amortization expense, and although these are non-cash expenses, the assets being depreciated may have to be replaced in the future, increasing our cash requirements; • excludes stock-based compensation expense; • excludes payroll taxes related to stock-based compensation; • does not reflect the positive or adverse adjustments related to the reserve for sales and other indirect taxes or certain legal and regulatory accruals and settlements, net; • excludes acquisition-related expenses; and • excludes restructuring charges. Other companies, including companies in our industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure. Because of these limitations, we consider, and you should consider, Adjusted EBITDA together with other operating and financial performance measures presented in accordance with GAAP. The following table presents a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated in accordance with GAAP: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Net income $ 106 $ 144 Add (deduct): Provision for income taxes 18 44 Interest income (14) (6) Depreciation and amortization expense 19 30 Stock-based compensation expense 66 80 Payroll taxes related to stock-based compensation (1) 10 7 Certain legal and regulatory accruals and settlements, net (2) 40 1 Reserves for sales and other indirect taxes, net (3) (1) - Acquisition-related expenses - 1 Adjusted EBITDA $ 244 $ 300 GTV $ 9,122 $ 10,288 Net income as a percent of GTV 1.2 % 1.4 % Adjusted EBITDA as a percent of GTV 2.7 % 2.9 % Revenue $ 897 $ 1,019 Net income as a percent of revenue 12 % 14 % Adjusted EBITDA margin 27 % 29 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. (2) Represents certain legal, regulatory, and policy expenses, including those related to worker classification, as well as non-recurring intellectual property matters and regulatory settlements. (3) Represents sales and other indirect tax reserves, net of abatements, for periods in which we were unable to collect such taxes from customers. We believe this adjustment is useful for investors in understanding our underlying operating performance because in these cases, the taxes were not intended to be a cost to us but rather are to be borne by the customers. Adjusted Cost of Revenue and Adjusted Cost of Revenue as a Percent of GTV We define adjusted cost of revenue as cost of revenue excluding depreciation and amortization expense and stock-based compensation expense. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature. The following table provides a reconciliation of cost of revenue to adjusted cost of revenue: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Cost of revenue $ 226 $ 281 Adjusted to exclude the following: Depreciation and amortization expense (14) (24) Stock-based compensation expense (2) (2) Adjusted cost of revenue $ 210 $ 255 Cost of revenue as a percent of GTV 2.5 % 2.7 % Adjusted cost of revenue as a percent of GTV 2.3 % 2.5 % Adjusted Operations and Support Expense and Adjusted Operations and Support Expense as a Percent of GTV We define adjusted operations and support expense as operations and support expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature. We exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as they are not indicative of our operating performance. The following table provides a reconciliation of operations and support expense to adjusted operations and support expense: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Operations and support expense $ 75 $ 74 Adjusted to exclude the following: Depreciation and amortization expense - (1) Stock-based compensation expense (3) (3) Payroll taxes related to stock-based compensation (1) (1) - Adjusted operations and support expense $ 71 $ 70 Operations and support expense as a percent of GTV 0.8 % 0.7 % Adjusted operations and support expense as a percent of GTV 0.8 % 0.7 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. Adjusted Research and Development Expense and Adjusted Research and Development Expense as a Percent of GTV We define adjusted research and development expense as research and development expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature and we exclude payroll taxes related to the vesting and settlement of certain equity awards and restructuring charges as they are not indicative of our operating performance. The following table provides a reconciliation of research and development expense to adjusted research and development expense: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Research and development expense $ 144 $ 164 Adjusted to exclude the following: Depreciation and amortization expense (2) (2) Stock-based compensation expense (34) (46) Payroll taxes related to stock-based compensation (1) (6) (4) Adjusted research and development expense $ 102 $ 111 Research and development expense as a percent of GTV 1.6 % 1.6 % Adjusted research and development expense as a percent of GTV 1.1 % 1.1 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. Adjusted Sales and Marketing Expense and Adjusted Sales and Marketing Expense as a Percent of GTV We define adjusted sales and marketing expense as sales and marketing expense excluding depreciation and amortization expense, stock-based compensation expense, payroll taxes related to stock-based compensation, acquisition-related expenses, and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as they are non-cash in nature and we exclude payroll taxes related to the vesting and settlement of certain equity awards, acquisition-related expenses, and restructuring charges as they are not indicative of our operating performance. The following table provides a reconciliation of sales and marketing expense to adjusted sales and marketing expense: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Sales and marketing expense $ 216 $ 230 Adjusted to exclude the following: Depreciation and amortization expense (2) (2) Stock-based compensation expense (13) (10) Payroll taxes related to stock-based compensation (1) (1) (1) Adjusted sales and marketing expense $ 200 $ 217 Sales and marketing expense as a percent of GTV 2.4 % 2.2 % Adjusted sales and marketing expense as a percent of GTV 2.2 % 2.1 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. Adjusted General and Administrative Expense and Adjusted General and Administrative Expense as a Percent of GTV We define adjusted general and administrative expense as general and administrative expense excluding depreciation and amortization expense; stock-based compensation expense; payroll taxes related to stock-based compensation; certain legal and regulatory accruals and settlements, net; reserves for sales and other indirect taxes, net; acquisition-related expenses; and restructuring charges. We exclude depreciation and amortization expense and stock-based compensation expense as these are non-cash in nature. We exclude payroll taxes related to the vesting and settlement of certain equity awards; certain legal and regulatory accruals and settlements, net; reserves for sales and other indirect taxes, net; acquisition-related expenses; and restructuring charges as they are not indicative of our operating performance. The following table provides a reconciliation of general and administrative expense to adjusted general and administrative expense: Three Months Ended March 31, 2025 2026 (in millions, except percentages) General and administrative expense $ 126 $ 88 Adjusted to exclude the following: Depreciation and amortization expense (1) (1) Stock-based compensation expense (14) (19) Payroll taxes related to stock-based compensation (1) (2) (1) Certain legal and regulatory accruals and settlements, net (2) (40) (1) Reserves for sales and other indirect taxes, net (3) 1 - Acquisition-related expenses - (1) Adjusted general and administrative expense $ 70 $ 65 General and administrative expense as a percent of GTV 1.4 % 0.9 % Adjusted general and administrative expense as a percent of GTV 0.8 % 0.6 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. (2) Represents certain legal, regulatory, and policy expenses, including those related to worker classification, as well as non-recurring intellectual property matters and regulatory settlements. (3) Represents sales and other indirect tax reserves, net of abatements, for periods in which we were unable to collect such taxes from customers. We believe this adjustment is useful for investors in understanding our underlying operating performance because in these cases, the taxes were not intended to be a cost to us but rather are to be borne by the customers. Adjusted Total Operating Expenses and Adjusted Total Operating Expenses as a Percent of GTV We define adjusted total operating expenses as the sum of adjusted operations and support expense, adjusted research and development expense, adjusted sales and marketing expense, and adjusted general and administrative expense. We exclude depreciation and amortization expense and stock-based compensation expense as these are non-cash in nature. We exclude payroll taxes related to the vesting and settlement of certain equity awards; certain legal and regulatory accruals and settlements, net; reserves for sales and other indirect taxes, net; acquisition-related expenses; and restructuring charges as these are not indicative of our operating performance. The following table provides a reconciliation of operating expenses to adjusted total operating expenses: Three Months Ended March 31, 2025 2026 (in millions, except percentages) Total operating expenses $ 561 $ 556 Adjusted to exclude the following: Depreciation and amortization expense (5) (6) Stock-based compensation expense (64) (78) Payroll taxes related to stock-based compensation (1) (10) (6) Certain legal and regulatory accruals and settlements, net (2) (40) (1) Reserves for sales and other indirect taxes, net (3) 1 - Acquisition-related expenses - (1) Adjusted total operating expenses $ 443 $ 463 Total operating expenses as a percent of GTV 6.1 % 5.4 % Adjusted total operating expenses as a percent of GTV 4.9 % 4.5 % ___________ (1) Represents employer payroll taxes related to the vesting and settlement of certain equity awards. (2) Represents certain legal, regulatory, and policy expenses, including those related to worker classification, as well as non-recurring intellectual property matters and regulatory settlements. (3) Represents sales and other indirect tax reserves, net of abatements, for periods in which we were unable to collect such taxes from customers. We believe this adjustment is useful for investors in understanding our underlying operating performance because in these cases, the taxes were not intended to be a cost to us but rather are to be borne by the customers. Free Cash Flow We define free cash flow as net cash provided by (used in) operating activities less purchases of property and equipment, including capitalized internal-use software. The following table provides a reconciliation of net cash provided by operating activities to free cash flow: Three Months Ended March 31, 2025 2026 (in millions) Net cash provided by operating activities $ 298 $ 268 Purchases of property and equipment, including capitalized internal-use-software (18) (16) Free cash flow $ 280 $ 253 Liquidity and Capital Resources We finance our operations primarily through fees received from retailers, customers, and brands. As of March 31, 2026, we had cash and cash equivalents of $631 million and marketable securities of $122 million, which were primarily held for working capital purposes. Although we have generated profit in recent periods, including net income of $144 million for the three months ended March 31, 2026, we have historically experienced significant net losses as reflected in our accumulated deficit of $4.7 billion as of March 31, 2026. While we generated positive cash flows from operating activities for the years ended December 31, 2024 and 2025 and for the three months ended March 31, 2026, our future cash flows from operating activities may fluctuate as a result of investments we continue to make across our organization. As a result, we may require additional capital resources to execute strategic initiatives to grow our business. Our working capital and operating cash flows fluctuated and continue to fluctuate significantly from period to period as a result of new initiatives, the timing of payments made to and/or received from retailers, shoppers, and vendors, and certain transaction types, such as those involving EBT SNAP and alcohol sales, which have a more significant impact on our working capital and operating cash flow due to the variability, magnitude, and timing of retailer reimbursements. Additionally, we make substantial weekly payments to shoppers on Tuesdays and Sundays for services delivered on Instacart and, therefore, we expect our reported cash and cash flows from operating activities to be impacted based on the day of the week of each reporting period. Furthermore, due to the timing of funding to a certain payment card issuer, we may experience an increase in short-term liabilities based on the day of the week of the last day of each reporting period. We believe that our existing cash, cash equivalents, and marketable securities will be sufficient to satisfy our anticipated cash needs for working capital and capital expenditures for at least the next 12 months and beyond. However, our future cash requirements will depend on many factors, including our growth rate, the timing and the amount of cash received from retailers, customers, and brands, the timing and extent of spending to support our research and development efforts as well as sales and marketing activities, the introduction of enhancements, the continuing market adoption of Instacart, and the volume and timing of our share repurchases. In addition, we may enter into additional or expanded retailer, customer, brand, or other relationships, as well as agreements to acquire or invest in complementary businesses, products, teams, and technologies, including intellectual property rights, which could increase our cash requirements. As a result of these and other factors, we may be required to seek additional financing sooner than we currently anticipate. If additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us, or at all. In particular, recent volatility in the global financial markets, including due to the impact of tariffs or other trade restrictions, elevated interest rates and other macroeconomic conditions, geopolitical conflicts, and potential disruptions in access to bank deposits or lending commitments due to bank failures could reduce our ability to access capital and negatively affect our liquidity in the future. If we are unable to raise additional capital when required, or if we cannot expand our operations or otherwise capitalize on our business opportunities because we lack sufficient capital, our business, results of operations, financial condition, and cash flows would be adversely affected. In May 2026, we entered into a revolving credit agreement with certain lenders which provides for a $500 million unsecured revolving credit facility maturing on April 2031. As of the date of this filing, no amounts had been drawn under the credit facility. Share Repurchases In June 2024, our board of directors authorized a $500 million share repurchase program, which was subsequently increased to $750 million, $1 billion, and $2.5 billion in November 2024, May 2025, and November 2025, respectively. In April 2026, our board of directors authorized an increase of $1.0 billion to the share repurchase program, bringing the total authorization under the program to $3.5 billion. For the three months ended March 31, 2026, we repurchased and immediately retired 9 million shares of our common stock for an aggregate purchase price of $402 million, including broker commissions, fees, and excise taxes, under this share repurchase program, which included shares repurchased under the ASR Agreement as described below. On November 10, 2025, we entered into the ASR Agreement with a third-party financial institution to repurchase $250 million of our common stock. Pursuant to the terms of the ASR Agreement, we paid $250 million to the financial institution and received and immediately retired an initial delivery of 5.4 million shares of common stock on November 12, 2025, representing 80% of the value of the $250 million payment. Repurchases under the ASR Agreement were completed in January 2026, and we received and immediately retired an additional 0.6 million shares. Refer to Note 12 - Stockholders' Equity for further discussion. Cash Flows The following table summarizes our cash flows for the periods presented: Three Months Ended March 31, 2025 2026 (in millions) Net cash provided by operating activities $ 298 $ 268 Net cash provided by (used in) investing activities 1 (8) Net cash used in financing activities (46) (328) Cash Flows from Operating Activities For the three months ended March 31, 2026, net cash provided by operating activities was $268 million, which consisted of net income of $144 million, adjustments for certain non-cash items of $159 million, partially offset by net cash outflows from changes in operating assets and liabilities of $35 million. Adjustments for certain non-cash items were primarily driven by stock-based compensation expense of $80 million and a decrease in deferred income taxes of $38 million. The year-over-year decrease in cash provided by operating activities was primarily driven by fluctuations in working capital from general business impacts including (i) the timing of customer, vendor, and other third-party payments and accruals including legal and regulatory matters and sales and indirect taxes; (ii) the timing of spend and usage of software subscriptions for hosting arrangements; and (iii) the overall growth of our business. Regulatory settlements of $60 million, previously accrued as of December 31, 2025, were paid with cash on hand in January 2026 and is reflected in the operating asset and liability changes noted above. For the three months ended March 31, 2025, net cash provided by operating activities was $298 million, which consisted of net income of $106 million, adjusted for certain non-cash items of $96 million, primarily driven by stock-based compensation expense of $66 million and by net cash inflows from changes in operating assets and liabilities of $96 million. The year-over-year increase in net changes in operating assets and liabilities, which impacted cash provided by operating activities, from a net cash inflow of $105 million to $298 million was primarily driven by fluctuations in working capital from general business impacts such as the timing of customer collections primarily due to the collection of a large accounts receivable balance from a retailer; the timing of customer, vendor, and other third-party payments and accruals; and the overall growth of our business. Cash Flows from Investing Activities For the three months ended March 31, 2026, net cash used in investing activities was $8 million, comprised primarily of purchases of property and equipment, including capitalized internal-use software, of $16 million and purchases of marketable securities of $4 million, partially offset by maturities of marketable securities of $12 million. For the three months ended March 31, 2025, net cash provided by investing activities was $1 million, comprised primarily of maturities of marketable securities of $81 million, partially offset by purchases of marketable securities of $62 million and purchases of property and equipment, including capitalized internal-use software, of $18 million. Cash Flows from Financing Activities For the three months ended March 31, 2026, net cash used in financing activities was $328 million, comprised primarily of repurchases of common stock of $359 million and taxes paid related to net share settlement of equity awards of $4 million, partially offset by changes in advances from a payment card issuer of $31 million and proceeds from the exercise of stock options of $3 million. For the three months ended March 31, 2025, net cash used in financing activities was $46 million, comprised primarily of repurchases of common stock of $89 million and taxes paid related to net share settlement of equity awards of $8 million, partially offset by changes in advances from a payment card issuer of $47 million and proceeds from the exercise of stock options of $4 million. Contractual Obligations and Commitments As of March 31, 2026, there have been no material changes from the contractual obligations and commitments as described in our Annual Report on Form 10-K for the year ended December 31, 2025. Critical Accounting Policies and Estimates Our condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q are prepared in accordance with GAAP. The preparation of condensed consolidated financial statements in accordance with GAAP requires us to make certain estimates, judgments, and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the period presented. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from our estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows could be affected. There have been no material changes to our critical accounting policies and estimates as described in our Annual Report on Form 10-K for the year ended December 31, 2025. Recent Accounting Pronouncements See Note 2 - Significant Accounting Policies in the notes to the condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.

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