Instacart Builds Momentum Across Ads, AI and In-Store Tech
Grocery technology company Instacart saw total revenue grow 14% to $1.043 billion in the second quarter of this year, compared with the same period last year, and gross transaction value also grew 14% year over year (YoY). Instacart saw orders grow 9% YoY to 90.3 million in the quarter ended June 30.
Instacart said that the company has activated net-new customers at its fastest YoY growth rates since 2022 during the previous three quarters. Instacart has worked to improve its order quality and inventory management by adding new personalization features like health tags and nutrition scores and acquiring computer vision company Arpalus to strengthen its real-time view of inventory.
"We're attracting and engaging more customers across our marketplace and enterprise platform, which creates more value for retailers, brands, and shoppers," Instacart CEO Chris Rogers explained. "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."
Instacart saw adjusted EBITDA jump 19% YoY to $313 million, the company said, with free cash flow surging 156% YoY to $480 million. Advertising was a bright spot for the company, with ad revenue growing 16% YoY to $297 million during Q2.
In Q3, Instacart expects gross transaction value of $10.3 billion to $10.55 billion, hitting 14% growth at the midpoint, CFO Emily Reuter said during the company's earnings call.
Partnerships and Tech
Instacart said it's growing its roster of retailers that have committed to not marking up products they sell on the platform, including existing partner Grocery Outlet and new partners Calgary Co-op and World Market.
"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," Rogers said during the company's earnings call.
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The company also mentioned it's continued to scale in-store technologies during Q2, such as its Caper Carts, which are launching at Weis Markets, and its FoodStorm order management system, which is expanding to Costco, Big Y and Sprouts.
Instacart said it signed new partners for its AI Solutions offerings in Q2, including Stew Leonard's, The Save Mart Companies, Woodman's and Harmons. The company also said it's seen orders placed through its AI assistant grow to average more than its overall $115 average order value.
"Our AI assistant doesn’t simply recommend recipes or generic product pairings," Rogers noted. "It understands a customer’s preferences, recent purchase history, what’s actually available at nearby stores, and current promotions."
Instacart also pointed to its partnerships with Google Search, Gemini and Pinterest as well as its shoppable video Immersive Feed as strengths during Q2.
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Instacart partners with more than 2,200 retail banners representing nearly 100,000 stores. Through the Instacart Marketplace, Instacart Enterprise platform and Instacart Ads ecosystem, the company powers e-commerce, fulfillment, in-store technology, AI offerings and advertising for partners. Maplebear Inc. is the registered corporate name of Instacart.
This article was originally published on P2PI sibling brand Progressive Grocer.
