DoorDash, Inc.DASH
DoorDash, Inc. Income Taxes Disclosure
Income Taxes
The components of income (loss) before income taxes were as follows (in millions):
Year Ended December 31, | |||||||||||||||||
| 2023 | 2024 | 2025 | |||||||||||||||
| United States | $ | 259 | $ | 925 | $ | 1,637 | |||||||||||
| Foreign | (793) | (769) | (698) | ||||||||||||||
| Income (loss) before income taxes | $ | (534) | $ | 156 | $ | 939 | |||||||||||
The components of provision for income taxes were as follows (in millions):
Year Ended December 31, | |||||||||||||||||
| 2023 | 2024 | 2025 | |||||||||||||||
| Current | |||||||||||||||||
| Federal | $ | 6 | $ | 5 | $ | (1) | |||||||||||
| State | 9 | 6 | 9 | ||||||||||||||
| Foreign | 17 | 27 | 36 | ||||||||||||||
Total | $ | 32 | $ | 38 | $ | 44 | |||||||||||
| Deferred | |||||||||||||||||
| Federal | 1 | 1 | (12) | ||||||||||||||
| State | — | — | (11) | ||||||||||||||
| Foreign | (2) | — | (14) | ||||||||||||||
Total | (1) | 1 | (37) | ||||||||||||||
Total provision for income taxes | $ | 31 | $ | 39 | $ | 7 | |||||||||||
Below is a tabular rate reconciliation pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025.
The items accounting for differences between income taxes computed at the federal statutory rate and the provision recorded for income taxes were as follows (in millions, except percentages):
| Year Ended December 31, | ||||||||||||||
| 2025 | ||||||||||||||
| Amount | Percent | |||||||||||||
| Provision for income taxes at U.S. federal statutory rate | $ | 197 | 21 | % | ||||||||||
State and local income taxes, net of federal income tax effect(1) | (15) | (2) | % | |||||||||||
| Foreign tax effects | ||||||||||||||
| Finland | ||||||||||||||
| Stock-based compensation | (30) | (3) | % | |||||||||||
| Changes in valuation allowance | 166 | 18 | % | |||||||||||
| Other | (3) | — | % | |||||||||||
| Other countries | 22 | 2 | % | |||||||||||
| Effect of cross-border tax laws | ||||||||||||||
| U.S. taxation of foreign branches | (183) | (20) | % | |||||||||||
| Tax credits | ||||||||||||||
| Research and development tax credits | (135) | (14) | % | |||||||||||
| Changes in valuation allowance | 100 | 11 | % | |||||||||||
| Nontaxable or nondeductible items | ||||||||||||||
| Stock-based compensation | (207) | (22) | % | |||||||||||
| Transaction costs | 16 | 2 | % | |||||||||||
| Other | 8 | 1 | % | |||||||||||
| Changes in unrecognized tax benefits | 69 | 7 | % | |||||||||||
| Other adjustments | 2 | — | % | |||||||||||
| Provision for income taxes | $ | 7 | 1 | % | ||||||||||
(1)State tax benefits in California made up the majority (greater than 50%) of the tax effect in this category.
As previously disclosed for the years ended December 31, 2023 and 2024, prior to the adoption of ASU 2023-09, the effective income tax rate differs from the statutory federal income tax rate as follows (in millions):
| Year Ended December 31, | ||||||||||||||
| 2023 | 2024 | |||||||||||||
| Income taxes computed at the federal statutory rate | $ | (112) | $ | 33 | ||||||||||
| State taxes, net of federal benefits | 7 | 5 | ||||||||||||
| Tax impact of foreign earnings and losses | 181 | (23) | ||||||||||||
| Change in valuation allowance | 47 | 292 | ||||||||||||
| Stock-based compensation | (59) | (174) | ||||||||||||
| Research and development credits | (44) | (106) | ||||||||||||
| Non-deductible expenses | 9 | 13 | ||||||||||||
| Other | 2 | (1) | ||||||||||||
| Provision for income taxes | $ | 31 | $ | 39 | ||||||||||
The components of deferred tax assets and liabilities were as follows (in millions):
| December 31, | |||||||||||
| 2024 | 2025 | ||||||||||
| Deferred tax assets | |||||||||||
| Loss carryovers | $ | 808 | $ | 1,839 | |||||||
| Tax credits | 376 | 539 | |||||||||
| Capitalized research and development | 886 | 589 | |||||||||
| Stock-based compensation | 54 | 65 | |||||||||
| Lease liabilities | 149 | 157 | |||||||||
| Accruals and reserves | 360 | 455 | |||||||||
| Other | 112 | 265 | |||||||||
| Total gross deferred tax assets | 2,745 | 3,908 | |||||||||
| Less: Valuation allowance | (2,352) | (3,197) | |||||||||
| Total deferred tax assets net of valuation allowance | 393 | 711 | |||||||||
| Deferred tax liabilities | |||||||||||
| Property and equipment and intangible assets | (224) | (661) | |||||||||
| Lease assets | (111) | (120) | |||||||||
| Prepaid expenses and other assets | (62) | (71) | |||||||||
| Total gross deferred tax liabilities | (397) | (852) | |||||||||
| Net deferred tax liabilities | $ | (4) | $ | (141) | |||||||
Due to the weight of objectively verifiable negative evidence, including its history of losses, the Company’s deferred tax assets have been fully offset by a valuation allowance, with the exception of certain foreign jurisdictions. Overall, the valuation allowance increased by $203 million, $494 million, and $845 million in the years ended December 31, 2023, 2024, and 2025, respectively. As of December 31, 2025, the portion of the valuation allowance for deferred tax assets for which subsequently recognized tax benefits will be credited directly to contributed capital was $170 million.
As of December 31, 2025, the Company had accumulated U.S. federal and state net operating loss carryforwards of $3.1 billion and $1.6 billion, respectively. Federal net operating losses carry forward indefinitely. Of the $1.6 billion of state net operating losses, $225 million carry forward indefinitely. The remaining state net operating loss carryforwards will begin to expire in 2026. As of December 31, 2025, the Company had foreign net operating loss carryforwards of $4.5 billion that begin to expire in 2026.
The Company also had $558 million and $279 million of federal and state research and development tax credit carryforwards, respectively, as of December 31, 2025. The federal research and development tax credits expire in varying amounts starting in 2041. The California research credits do not expire and carry forward indefinitely.
The Company’s ability to utilize the U.S. net operating loss and tax credit carryforwards in the future may be limited in the event of past or future ownership changes as defined in Section 382 and 383 of the Internal Revenue Code of 1986, as amended, and similar state tax law. Based on the most recent analysis, the Company does not anticipate a current limitation on the tax attributes under Section 382 and 383.
The Company intends to invest substantially all of its foreign subsidiary earnings, as well as its capital in its foreign subsidiaries, indefinitely in those jurisdictions in which the Company could incur significant, additional costs upon repatriation of such amounts.
Unrecognized Tax Benefits
A reconciliation of the beginning and ending balance of gross unrecognized tax benefits is included in the table below (in millions):
| Year Ended December 31, | |||||||||||||||||
| 2023 | 2024 | 2025 | |||||||||||||||
| Unrecognized tax benefits at beginning of year | $ | 69 | $ | 183 | $ | 275 | |||||||||||
| Increases related to current year tax positions | 47 | 64 | 66 | ||||||||||||||
| Increases related to prior year tax positions | 67 | 28 | 9 | ||||||||||||||
| Decreases related to prior year tax positions | — | — | — | ||||||||||||||
| Unrecognized tax benefits at end of year | $ | 183 | $ | 275 | $ | 350 | |||||||||||
The Company had $350 million of gross unrecognized tax benefits as of December 31, 2025, the majority of which would not impact its effective tax rate if recognized due to the Company's valuation allowance.
The Company is subject to taxation in the U.S. and various state and foreign jurisdictions. The material jurisdictions in which the Company operates include the United States and Finland. The Company’s 2013 and subsequent tax years remain open to examination by the U.S. Internal Revenue Service. The Company’s 2019 and subsequent tax years remain open to examination in Finland.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 18, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 20, 2024 | |
| 2022 | Feb 27, 2023 | |
| 2021 | Mar 1, 2022 | |
| 2020 | Mar 5, 2021 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.