Bernstein Analyst Nikhil Devnani on DoorDash and Rideshare Sector Growth

Consumer Demand for Convenience

• 💡 Consumers consistently demonstrate a strong preference for convenience, and are willing to pay for it across various services.
• 📈 The frequency of use for delivery and rideshare services continues to grow across different demographics and markets.
• 🎯 These platforms are effectively solving a real problem for consumers, leading to habitual engagement.

Investment and Growth Opportunities

• 🚀 Businesses are making significant investments in new growth opportunities, including international expansion and new product development.
• 💰 This strategic investment, coupled with strong consumer demand, is driving incremental growth for these companies.

Strengthening Business Fundamentals

• 📊 The market is increasingly recognizing these companies as stronger businesses than previously assessed.
• 📈 Earnings are showing considerable positive inflection, with ongoing margin improvement expected.
• 🧠 The market is acting more rationally, providing a solid foundation for the underlying theses in this sector coverage.

User Engagement and Recurring Revenue

• 👥 Companies like DoorDash and Uber serve tens to hundreds of millions of people, with high frequency of use (5-6 times per month on average).
• 💳 A growing portion of their user base is becoming subscribers, making the businesses highly recurring and habitual.
• 💸 Users are increasingly spending more with these platforms, underscoring the value consumers place on the services offered.