The report landed on a Friday afternoon, which is when the market tends to be least able to check it. The Information said Instacart had hired an investment bank to evaluate a sale and had held preliminary talks with DoorDash and Uber. By the close, Instacart shares were up 9.2% at $56.44, adding more than a billion dollars of market value in a single session to a company that had spent most of the year being told it was worth less.
The buyers’ side of the story moved faster than the sellers’. Bloomberg reported within hours that Uber had already walked away and that the two sides were no longer talking. Neither company commented. Instacart, which trades under the legal name Maplebear, declined to comment to Reuters as well.
The arithmetic explains why the shares moved. Instacart was worth about $12 billion before the report. A takeover premium of 30% to 40%, roughly the range for recent technology deals, implies a price of $16 billion to $17 billion. Whether any buyer will pay that for a grocery-delivery business with thin margins and a customer base that arrives through someone else’s app is a separate question, and it is the one the investment bank has been hired to answer.
The history is not encouraging for the sellers. DoorDash held talks to buy Instacart once before, in 2021, when the company was being valued at $40 billion to $50 billion in private markets. Those discussions died over antitrust concerns in the Biden administration. Instacart went public in September 2023 at $30 a share, a $9.9 billion valuation that was already less than a quarter of its 2021 private round. The stock has spent most of the three years since below its offer price.
Both possible buyers have been spending. Uber agreed to buy Delivery Hero for $14.8 billion in July and followed it this month with a $2.3 billion deal for the catering marketplace ezCater. DoorDash bought Deliveroo last year. Neither needs another delivery app so much as it needs what Instacart owns: the grocery catalogue, the relationships with retailers who do not want to build their own logistics, and an advertising business that sells sponsored placement to consumer packaged goods companies at software-like margins.
That advertising line is the part that has kept Instacart profitable and the part a buyer would actually be paying for. Delivery is a low-margin business that gets worse as density improves elsewhere. Retail media is a high-margin business that gets better with scale, and Instacart’s first-party data on what people put in their baskets is difficult to replicate.
The strategic pressure is coming from both ends. Grocers including Kroger and Albertsons have spent years building their own digital channels and their own loyalty programs, and every improvement there reduces the share of orders that flow through a third-party marketplace. At the same time, Amazon has been expanding Amazon Now, which promises grocery and household essentials in thirty minutes or less, sold to Prime members who already pay for the subscription.
“Instacart risks getting squeezed between retailers building their own digital channels and larger platforms that can bundle grocery with other services, giving consumers more reasons to keep coming back,” Zak Stambor, an analyst at Emarketer, told Reuters. A sale, in his view, would give the company the resources and reach to compete.
The regulatory math has changed since 2021 but not disappeared. A combination of Instacart with either DoorDash or Uber would put two of the largest grocery and restaurant delivery platforms in the United States under one roof, and the current administration has shown more willingness to clear large deals, though often at the price of divesting parts of the business. Any transaction would probably require a remedy, and the remedy would probably involve the pieces the buyer wants most.
Integration is the other piece of the calculation. A grocery marketplace runs on a shopper network that picks and packs orders inside stores, and that network has to be scheduled store by store, hour by hour. DoorDash and Uber both operate courier networks built for restaurant food, which moves in a bag and tolerates a fifteen-minute window. Batching a grocery order across a courier who is already carrying a burrito is a harder problem than either company’s existing logistics suggests, and buyers have learned to discount the synergies they are pitched.
There is a timing element too. Instacart reports quarterly results on November 5, and DoorDash on November 4. A company exploring a sale does not usually want to negotiate a price before printing a quarter, and a buyer does not usually want to bid before seeing one. Two earnings calls in two days will tell both sides whether the grocery business is stabilizing or still shrinking.
For a company that has run as an independent business for fourteen years, since Apoorva Mehta started it in a San Francisco apartment with a bag of groceries and a phone, the options are narrower than the headlines suggest. It can sell at a premium to a competitor that will face a lengthy review, it can keep cutting costs and buying back stock, or it can wait for a strategic buyer that has not yet appeared. The stock reaction says investors think the first path is now live. The Uber exit says the first call did not go well.
