Ron Josey: Great. Thanks for taking the question. I wanted to maybe, Tony, take it back to take rates and sort of where we stand. I think in the press release you talked about reduced average delivery time, defect rates, net consumer fees per order lower. So I was curious if you could talk just about the contributions of these changes or these improvements to overall take rates and on a scale of where we are and the continuum of how things are going, sort of how much more is there that can just improve? And I’m sure the answer is infinite. But, when we think about defect rates coming down, I think that’s a pretty material rate on impact on take rates. So any insights there would be helpful, just on delivery time, defect rate, just overall efficiencies.
And as a follow-up to Andrew’s question on platform services, just curious, we’ve been highlighting it for the past couple of quarters. Would love to hear just are we seeing more adoption amongst restaurants today versus a few years ago? Thank you.
Tony Xu: Sure, I can take both of them. I think the first question was around just how do we see, like, I guess, benefits to the consumer product improving over time. I mean, look, I mean, this is one of those things where it’s really a game of inches and then you’re just following the laws of compound interest, which tend to get underestimated, right? And so, you’re totally right. I mean, like, consumers demand improvements across the board. They always want lower prices, faster deliveries, higher accuracy, more selection, better customer support. That is always going to be true. And I think the thing that just, at least for me, like that’s been just a lesson learned over almost now, 11 years, but over 10 years of doing this is that we always underestimate, I think, how far these things can go.
And I think that’s kind of just fighting human nature, right? I mean, because I think human nature wants to know that there’s some marginal return that becomes a concave function. And I think what ends up happening is you get surprised either by the next technology platform or you just get surprised by how compounding works. And so that’s always been my experience so far. And so we’re always going to keep pushing the envelope. And so far, we keep seeing more ways to make improvements to the product in part because that’s what customers expect. And that’s actually why I’ve always believed that customer expectations have always been, candidly, the highest or the most difficult form of competition. I think your second question was around platforms and our restaurants may be adopting more now than before.
I think it’s a few things. So I think when it comes to adopting products to help retailers, physical retailers become more digital, it’s one of these things where it’s a journey, and sometimes the journey takes non-linear steps, if that makes any sense. Because if you think about it from the perspective of the merchant, I mean, they have so many years of running a physical business, and it’s such a big part of their business still — businesses still today that they kind of just have to get right, right? And if that goes wrong or any shock to that system, then it’s a really big impact to the overall company and the people who work there. And so, sometimes these things just kind of have, like, a natural rhythm that may take a little bit longer than you would expect.
But I think what’s encouraging is just that the appetite is moving in one direction. And so a lot of times, the timing of these kinds of changes, whether it’s rolling out new products or doing more with us on fulfillments or whether it’s in restaurants or other categories, that’s, like, maybe less predictable. But what is known is that the direction of travel is always in the direction of greater digital, greater convenience.
Ron Josey: Got it. Thank you, Tony. Appreciate it.
Operator: Your next question comes from the line of Bernie McTernan with Needham & Company. Please go ahead.
Bernie McTernan: Great. Thank you for taking the question. Just want to ask on the core US restaurant business decelerates slightly in the quarter on a pro forma or ex leap year basis. What was the major driver that large numbers could be playing a factor here? And if you’d be willing to share if it was still a double-digit growth or ex leap year in the first quarter.
Ravi Inukonda: Yeah, Bernie, I mean, I’ll take this one. Like, I mean, look at the performance of the business in Q1, I mean, I was really pleased with the overall progress and performance of the business. I mean, the US restaurant business has grown large at this point. It’s growing. It’s gained share in the quarter not just in Q1, but look at over the course of the last year. When I look at users and order frequency, both have continued to grow quite nicely. Users, last quarter we talked about the fact that we have more than 37 million consumers on the platform. That number has continued to grow since that point. The growing users at double-digit rates. Order frequency continues to be at an all-time high. When I look at the underlying cohort performance, I mean, it’s very strong.
DashPass subscribers continue to be at record highs as well. But look, I mean, we invested to continue to expand the size and scope of the platform and the opportunity in front of us. When look at new verticals, that business is growing. Grocery, we talked about that business is doubling for three straight quarters in a row. International business is growing quite nicely. Our strategy of having multiple categories in multiple countries is going to allow us to really drive strong growth for many years to come.
Operator: Your next question comes from the line of Lee Horowitz with Deutsche Bank. Please go ahead.
Lee Horowitz: Great. Thanks for taking the question. I just wanted to ask on the macro environment a little bit. You’ve heard from a number of restaurants a change this quarter indicating incrementally weak consumer demand environment with inflation perhaps being in place, higher for longer, finally catching up to the consumer. Can you comment at all maybe what you’re seeing in the overall macro environment in terms of overall demand into the restaurant business and how that may be impacting sort of your outlook for the 2Q and the rest of the year? Thanks so much.
Tony Xu: Yeah, I can take that. I mean, in general, we’re not seeing, I think, the signs of strain on the consumer, but I think it perhaps has something to do with the segment that we operate in, which is digital and delivery. I do understand that there are some headwinds that certain merchants face when it comes to in-store traffic. But when it comes to all things digital, we’re actually not seeing, I think, those same signs of strains. Even, for example, in the US restaurants business, I mean, the growth is pretty consistent over the last six quarters. So it’s — that’s — whatever, 18 months or something that roughly has been true for. And so we tend to see that to be true there. We even see it true in other categories. Even categories like grocery, where you’re still seeing very sticky or very high inflation in terms of input prices which have led to high prices on grocery items.
But I think on the digital side, we tend to see pretty strong demand, and that’s why you see relatively stable growth.
