• Gross Transaction Value (GTV): Grew 10% year over year in Q4, reaching the high end of guidance.
• Order Growth: Increased by 11% year over year, driven by growth in users and order frequency.
• Average Order Value: Declined by 1% due to restaurant orders.
• Transaction Revenue: Increased by 10% year over year.
• Advertising and Other Revenue: Grew by 10% year over year.
• Net Income: $148 million, an increase of $13 million year over year.
• Adjusted EBITDA: $252 million, up 27% year over year, exceeding guidance.
• Operating Cash Flow: $153 million, decreased year over year due to working capital fluctuations.
• Cash and Similar Assets: Ended 2024 with $1.5 billion, down from $2.3 billion the previous year.
• Share Repurchases: $5 million worth of shares bought back in Q4, totaling 46 million shares for $1.4 billion in 2024.
• Q1 2025 GTV Outlook: Expected between $9 billion and $9.5 billion, representing 8% to 10% growth year over year.
• Q1 2025 Adjusted EBITDA Outlook: Expected between $220 million and $230 million.
• Stock-Based Compensation Target for 2025: Less than $425 million.

• Warning! GuruFocus has detected 7 Warning Signs with CART.

Release Date: February 25, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Maplebear Inc (NASDAQ:CART) reported a strong finish to 2024 with a 10% year-over-year growth in Gross Transaction Value (GTV), driven by an 11% increase in orders.
• The company has successfully expanded its user base and increased order frequency, particularly among Instacart Plus members, who remain highly engaged.
• Maplebear Inc (NASDAQ:CART) has made significant strides in affordability initiatives, helping customers save $1.2 billion in the past year through various programs.
• The company has seen positive results from its Enterprise Solutions, including the rollout of Caper Carts, which have driven double-digit increases in basket size at pilot retailers.
• Advertising revenue grew by 10% year-over-year, with over 7,000 active brand partners and a $1 billion annual run rate, indicating strong demand for its advertising solutions.

Negative Points

• Average order value declined by 1% year-over-year, primarily due to the impact of restaurant orders, which tend to have smaller basket sizes.
• Operating cash flow decreased year-over-year due to fluctuations in working capital, and cash reserves fell from $2.3 billion to $1.5 billion.
• The macroeconomic environment for food and beverage remains challenging, impacting advertising growth potential.
• Despite strong growth in new user acquisition, the company faces ongoing challenges in accelerating the overall adoption of online grocery shopping.
• The rollout of Caper Carts and other enterprise solutions is still in early stages, requiring significant operational efforts and time to scale effectively.

Q & A Highlights

Q: Can you talk more about some of the key investment areas for 2025, especially in-store solutions and restaurants? A: Fidji Simo, CEO, highlighted that the company will continue to invest in core areas such as selection, affordability, convenience, and speed. Restaurants are part of increasing selection, and affordability remains critical for accelerating online adoption. Enterprise Solutions, including Caper, are also a priority, with Caper showing double-digit increases in basket size at pilot retailers. Innovation in advertising is another key area, with new formats and AI integration driving growth.

Q: How do you see the platform set up for grocery and non-grocery driven growth? A: Fidji Simo, CEO, stated that both grocery and non-grocery segments are showing strength. The addition of restaurants is not only creating a new use case but also increasing grocery business by enhancing platform stickiness and Instacart Plus value. The halo effect on grocery is strengthening, and the company expects continued growth from both segments.

Q: How do you think about the economics of smaller baskets with free delivery for Instacart Plus? A: Fidji Simo, CEO, explained that the reduction in minimum basket size has led to increased order frequency and GTV without impacting larger basket orders. The company is able to maintain favorable economics by batching orders due to high order density, allowing competitive pricing and further optimization as order growth continues.

Q: Can you elaborate on the use of AI in tracking store inventory and substitutions? A: Fidji Simo, CEO, mentioned that AI is used extensively across the business, including improving replacement accuracy by training on more data. In 2024, 300 million replacements were made with a 95% satisfaction rate. AI also helps manage inventory by integrating with retailer systems and using shopper data for real-time updates. These efforts improve customer retention and profitability by enhancing order quality.

Q: What are the key investments to drive ad revenue growth in 2025? A: Fidji Simo, CEO, identified performance, scale, diversification, and innovation as key areas. The company aims to maintain leading ad performance, expand scale through Carrot Ads and partnerships, diversify its advertiser base, and innovate with new ad formats. These efforts are expected to attract more advertising budgets and drive growth.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.