Maplebear Inc. Common Stock 2026 Q2 Earnings Call

Please go ahead. Thank you, operator.

Welcome everyone to Instacart's second quarter 2026 earnings call. On the call with me today are Chris Rogers, our Chief Executive Officer, and Emily Reuter, our Chief Financial Officer. During today's call, we will make forward-looking statements related to our business plans and strategy, developments in the grocery industry, and our future performance and prospects, including our expectations regarding our financial results and share repurchases. These forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. You can find more information about these risks and uncertainties in our SEC filings, including our most recently filed Form 10-K or Form 10-Q. We assume no obligation to update these statements after today's call, except as required by law.

In addition, we'll also discuss certain non-GAAP financial measures, which have limitations and should not be considered in isolation from or as a substitute for our GAAP results. A reconciliation between these GAAP and non-GAAP financial measures is included in our press release, which can be found on our investor relations website. I'll turn the call over to Chris for his opening remarks.

Thanks, Rebecca. Good afternoon, everyone. Thanks for joining us. Our business is performing incredibly well. We've meaningfully accelerated our growth over the past three quarters, including a strong Q2 performance, where we grew GTV 14% year-over-year. We also increased total revenue by 14%, driven by a stronger than expected advertising and other revenue performance, which grew 16% and again, outpaced GTV growth. At the same time, we expanded adjusted EBITDA and operating cash flow year-over-year, reflecting our continued focus on driving profitability while reinvesting for growth. These results reflect broad-based momentum across our business. We're continuing to improve the customer experience on our leading online grocery marketplace, accelerate adoption of our enterprise technologies with retailers, and expand the breadth and depth of our advertising ecosystem. That momentum is showing up in our customer base.

Over the past three quarters, we've activated net new customers at our fastest year-over-year growth rates since 2022, helping drive strong monthly customer growth while we've continued to deepen customer engagement. With that, let me walk you through how we're executing across our growth engines. Starting with marketplace. Our fundamentals remain strong because we're relentlessly focused on delivering the best end-to-end grocery experience. One of our biggest advantages is our data. We've completed more than 1.6 billion lifetime orders, built a catalog of over 2 billion products, and operate at a scale where our shopper network visits large format stores an average of more than 15 times a day. Every day, we generate more than 10 million inventory signals that help us understand what's actually available on store shelves in real time. Every order placed, item picked, and substitution completed makes that understanding even stronger.

That gives us a structural advantage that's incredibly difficult to replicate, and it allows us to build better grocery experiences with every order. We're using that advantage to continuously improve order quality, which we know is one of the most important drivers of repeat customer behavior. In Q2, we improved both our found rate and perfect order fill rate year-over-year for the 16th consecutive quarter. We're building on that momentum with new capabilities that make shopping more personalized and orders even more accurate. This quarter, we began testing personalized health tags and nutrition scores, which help customers discover products that better match their dietary preferences. Customers will start seeing simple indicators that identify products aligned with their nutritional preferences and make it easier to compare options while they shop. We're also making replacements more personalized with a new model that better incorporates customers' dietary preferences.

If a customer's preferred product is out of stock, we're much more likely to recommend a relevant replacement such as gluten-free, low sugar, or allergen-free. Beyond improving today's customer experience, we're continuing to invest in what we believe is one of Instacart's biggest advantages, inventory intelligence. In July, we acquired Arpalis, whose computer vision technology turns a quick video scan into a highly accurate view of what's actually on the shelf. By combining Arpalis's technology with our operating scale and network of approximately 600,000 shoppers, we expect to drive additional fulfillment efficiency, enable more relevant AI-powered shopping experiences, and further strengthen our inventory intelligence. Our data advantage is helping us build the gold standard in agentic grocery shopping. Our AI assistant doesn't simply recommend recipes or generic product pairings. It understands a customer's preferences, recent purchase history, what's actually available at nearby stores, and current promotions.

It turns those insights into an order that's ready to be placed and delivered in as fast as an hour. Customers are already using our AI assistant to quickly restock their essentials, find deals and discounts, order ingredients from recipe suggestions, discover new products, and plan meals. Orders placed with our AI assistant are, on average, larger than our typical basket. That's especially notable given our industry-leading average order value of $115. We're excited to build on this momentum and launch our AI assistant across our marketplace in North America over the next several weeks. We remain focused on affordability, which we know is one of our biggest opportunities to accelerate online grocery adoption. Retailers that offer no markups on item prices continue to drive faster growth and stronger customer retention.

Instacart already has more retailers offering online grocery delivery with no markups than any other third-party marketplace in North America, and we're continuing to extend that advantage. Grocery Outlet is eliminating markups nationwide across our marketplace, alongside regional favorites like Strack & Van Til and Super King Markets. New partners including Ace Hardware, Calgary Co-op, Tractor Supply Company, and World Market are also launching with no markups right out of the gate. The same scale and innovation that powers our marketplace also makes us a trusted technology partner for retailers' owned and operated channels. Retailers increasingly choose Instacart because we've already solved the hardest problems in online grocery. We bring those capabilities together in one connected platform spanning e-commerce, fulfillment, in-store, retail media, and AI, while keeping retailers' brand, customer relationships, and data their own.

Our enterprise platform continues to be led by our e-commerce Storefront solution, which powers more than 380 grocery sites and helps retailers drive incremental growth and stronger customer engagement. Recently, we launched Storefront Pro with new partners like Calgary Co-op, Dierbergs, and more, and Aldi's Q1 launch on Storefront Pro in the U.S. is already performing ahead of our expectations. We're bringing that same innovation into retailers' physical stores, where most grocery shopping still happens. Caper, our AI-powered smart cart, continues to scale with both new and existing partners, including Weis Markets and Lakesfront in the U.S., and now Morrisons in the U.K. We're also seeing strong momentum with Foodstorm, our order management system for retailers' catering, prepared foods, deli, and bakery departments. These perimeter sales are an important source of customer loyalty, and they drive high-margin revenue for retailers.

Recently, Costco launched Foodstorm-powered online ordering and delivery for custom cakes and party platters nationwide, digitizing an experience that was previously available only in the warehouse. We also signed Big Y for a chain-wide rollout of online catering and in-store shelf ordering kiosks, while Sprouts is expected to launch in-store kiosks across its California locations later this year. As part of our enterprise offering, we're taking the AI technology that we've built on our marketplace, and we're offering it to retailers. In Q2, we signed new AI solution partners including Stew Leonard's, MAR Companies, and Woodman's, each for Agentic Analytics, our solution that transforms a retailer's own data into instant actionable insights. These three retailers, in addition to Harmons, also signed for our white label AI assistant. We're also expanding our enterprise platform internationally beyond North America.

Earlier this year, we launched Storefront Pro with Costco in France and Spain, which continues to perform well. Instaleap, which we acquired in Q2, is expanding our international reach and recently signed a new picking technology partnership with Morrisons, one of the United Kingdom's largest supermarket chains. All of this growth across marketplace and enterprise strengthens our advertising and data offering. Our strategy to diversify both supply and demand across our ecosystem continues to gain momentum, and in Q2, advertising and other revenue grew 16% year-over-year, once again outpacing GTV growth. Our marketplace and network of curated partners continues to grow as more e-commerce platforms turn to Instacart to power their retail media. This gives brands a simpler way to reach high-intent grocery customers across more retailers at a time when they're looking to manage fewer retail media networks.

That attracts more brands to Instacart, encourages existing partners to invest more, and creates a stronger, more resilient advertising ecosystem. We continue to add new optimization tools to help advertisers achieve more of their goals. We recently rolled out AI-powered recommendations in Ads Manager to all advertisers, helping them improve performance through campaign and creative recommendations. In Q2, we began testing our Grow objective, which helps brands increase customer lifetime value by driving more repeat purchases, and we expanded our Acquire objective to display ads, helping brands reach more new customers. We are also introducing new ad formats that give brands more ways to engage customers. Our new Immersive Feed brings the kind of recipe and meal inspiration customers already enjoy on other platforms to Instacart in a shoppable vertical video format that helps brands drive discovery, engagement, and incremental reach.