Instacart (CART) delivered a strong start to 2025 with Q1 Gross Transaction Value (GTV) reaching $9.1 billion, a 10% year-over-year increase that hit the upper end of guidance. This performance was driven by a robust 14% rise in orders to 83.2 million, marking the fastest order growth in ten quarters. The surge stemmed from both increased user activity and frequency, aided by strategic initiatives like lowering the Instacart+ basket minimum and expanding into restaurant delivery. These smaller, more frequent orders contributed to a 4% decline in average order value (AOV) but proved incremental rather than cannibalistic, especially in urban areas.

On the financial front, gross profit rose 9% YoY to $671 million, with gross margin steady at 75%, while transaction revenue held firm at 7.1% of GTV, growing 8% YoY. A standout was Instacart’s advertising and other revenue, which surged 14%, outpacing GTV growth and driven by both large CPGs and over 7,000 emerging brands. Adjusted EBITDA climbed 23% YoY to $244 million, exceeding guidance, and operating cash flow jumped by $193 million to $298 million, reflecting strong collections and operational execution. However, GAAP net income fell to $106 million, down $24 million YoY, largely due to a tough comparison against a one-time compensation reversal last year.

The company continues to scale its enterprise business, announcing the acquisition of Wynshop to deepen integration and support white-label storefronts. Its ad business is gaining momentum, with over 220 partners now using Carrot Ads, benefiting from Instacart’s advanced ad tech and broad demand. Meanwhile, AI remains central to operations, powering 87% of code development and driving personalization through features like Smart Shop.

CEO Fidji Simo underscored Instacart’s resilience and broadening customer base, now reflective of the U.S. population in income and urbanicity. CFO Emily Reuter emphasized continued profitability and strong fundamentals, guiding for Q2 GTV of $8.85–$9.0 billion and adjusted EBITDA of $240–$250 million, with order growth again expected to lead. Despite macro uncertainty, Instacart’s diversified ad base and essential category positioning provide insulation, and management remains confident in achieving full-year EBITDA expansion.