Episode Details

Maplebear Inc. (Instacart) (CART) Q2 2026 — Q2 2026 (ended June 30): GTV $10,351M +14%, revenue $1,043M +14% (bar $1,026M), adjusted EBITDA $313M +19% (bar $297.8M, a 5.1% BEAT), but GAAP diluted EPS $0.45 vs a $0.542 bar - a 16.6% MISS - and net income $111M, DOWN 4%. Orders 90.3M, up only 9%. The 8-K hit EDGAR at 4:09pm ET Thursday Aug 6, so Friday Aug 7 is the reaction session: $45.03 to $50.17, UP 11.41%. Instacart missed the consensus EPS number by 16.6% and the stock added over $1.2B of market value the next session. Both were correct: the miss is entirely tax and lost interest income (income from operations grew 15.3% to $143M; interest income fell $15M to $5M and the tax rate went 18.3% to 24.5%), while adjusted EBITDA beat by 5.1%. But three things went unquoted. Order growth has nearly halved in two quarters (Q4 2025 +16%, Q1 2026 +10%, Q2 2026 +9%) and orders FELL sequentially, 91.2M to 90.3M - the 14% GTV headline is basket size, up 4.4% to $114.63. Advertising is 2.87% of GTV against 2.81% a year ago, and that ratio has not left a 2.8-3.1% band for three years. And EPS rose 8% while net income fell 4%: on last year's diluted share count the quarter earned $0.395, not $0.446. THE CALL: HOLD (3/5, A GENUINELY GOOD BUSINESS THAT JUST REPRICED TO FAIR - FRIDAY TOOK THE MARGIN OF SAFETY WITH IT) — base-case value ~$56.0 vs ~$50.17 today. KEY METRICS: - CALL: HOLD 3/5, fair value $56 vs the $50.17 Aug 7 close (+11.6%). Bull $74, bear $38, we would buy under $44. Street: Buy, 28 analysts, 21 buy / 6 hold / 1 sell, avg target $56.47 (+12.6%); the seven targets raised on Aug 7 average $59. - GTV $10,351M +14%; orders 90.3M +9% (was +16% two quarters ago); AOV $114.63 +4.4%. Revenue $1,043M +14%. Ads $297M +16.5% = 2.87% of GTV vs 2.81%. Adj EBITDA $313M +19% (5.1% beat). GAAP EPS $0.45 vs $0.542 (16.6% miss). - Op income +15.3% to $143M; the miss is $10M less interest income and a 24.5% tax rate. EV $10.93B on 231.5M shares, no debt, $885M cash. 9.2x adj EBITDA but 18.0x our $608M of 2026 owner earnings after $430M of SBC. What to watch: UP: GTV +14% is the fastest in three years and Q3 guidance implies another +14% at the midpoint ($10,300-$10,550M) with adjusted EBITDA of $320-340M (+19%); advertising and other revenue $297M, +16.5%, outpacing GTV; gross margin 72% of revenue; adjusted EBITDA $313M, 3.0% of GTV, a record; free cash flow $480M; $885M of cash and securities with ZERO debt; $998M still authorised for buyback after $1,859M repurchased in twelve months; the Enterprise stack (Storefront Pro, Caper, FoodStorm, AI Solutions) keeps signing retailers, and Instacart became Google's first grocery partner to integrate with Gemini. DOWN: order growth halved from +16% to +9% in two quarters and orders fell sequentially; the advertising take rate has been flat at 2.8-3.1% of GTV for three years; all of the EPS growth is the buyback; the $156% free cash flow jump is ~62% an accounts-receivable release; SBC $142M is +35% YoY and 13.6% of revenue with $659M unrecognised; a $596M deferred tax asset is holding cash taxes below book taxes; and DoorDash, Uber Eats, Amazon Fresh, Walmart Spark and Kroger all want the same order. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.