DoorDash, Inc. (NASDAQ:DASH)

The analysis of the financial ratios over the observed periods reveals notable trends in the company's profitability and financial structure.

Return on Assets (ROA)

The ROA values, which are available from the period ending December 31, 2021, show a generally negative trend initially, indicating that the company was not generating positive returns on its assets. The ratio deteriorated from -6.87% to a low of -14.09% by June 30, 2023, reflecting increasing inefficiency or losses relative to the asset base during that period. However, after this trough, the ROA demonstrates a steady recovery, progressively improving each quarter to a positive 4.61% by June 30, 2025. This shift indicates a significant turnaround in asset profitability and operational efficiency.

Financial Leverage

The financial leverage ratio shows a gradual upward trend over the entire period under review. Starting from 1.3 in March 31, 2021, the ratio increased moderately with minor fluctuations, reaching 1.9 by June 30, 2025. This increase suggests that the company has been using more debt relative to equity to finance its assets over time, which can amplify both returns and risks.

Return on Equity (ROE)

The ROE followed a pattern similar to ROA but with more pronounced negative values initially. Beginning from -10.03% in December 31, 2021, it declined sharply to a low of -20.85% by June 30, 2023, indicating substantial losses to shareholders' equity at that time. Subsequent quarters saw an improvement with ROE progressively increasing to 8.75% by June 30, 2025. This positive shift reflects improved profitability and effectiveness in generating returns for equity holders, aligning with the improved asset returns and increasing leverage.

Overall, the data depicts a company that experienced a challenging period with negative returns impacting both assets and equity, accompanied by increased financial leverage. Nonetheless, a clear recovery phase is evident from mid-2023 onwards, marked by growing returns and continued leverage growth, suggesting strategic improvements and a strengthening financial position going forward.

Net Profit Margin

The net profit margin exhibits a negative trend starting from the fourth quarter of 2021, reaching its lowest point at -20.74% in the fourth quarter of 2021. Following this low, there is a gradual improvement in profitability, with the margin steadily increasing across subsequent periods. By the first quarter of 2025, the net profit margin turns positive at 1.15% and continues to enhance, reaching 6.57% by the second quarter of 2025. This pattern indicates an initial period of losses followed by a consistent recovery and eventual profitability.

Asset Turnover

Asset turnover shows moderate fluctuations but remains relatively stable over the observed periods. Initial values in early 2022 are around 0.72 to 0.77, with a dip to 0.57 in the third quarter of 2022. After this decline, the ratio exhibits a recovery and stabilizes around 0.8 to 0.83 from late 2022 through mid-2025. The ratio slightly decreases to 0.7 in the last available period but overall maintains a consistent level, suggesting steady efficiency in using assets to generate revenue.

Financial Leverage

Financial leverage increases gradually from 1.3 in the first quarter of 2021 to 1.62 in the first quarter of 2025. Notably, a sharper rise occurs in the later periods, culminating at 1.9 in the second quarter of 2025. This trend reflects an increasing reliance on debt or borrowed capital relative to equity over time, potentially indicating a strategy to finance growth or operations through leverage.

Return on Equity (ROE)

Return on equity follows a negative trajectory through much of the observed period, mirroring the earlier net profit margin's losses. ROE declines to its lowest at -20.85% in the second quarter of 2022, then begins a recovery trend. From mid-2023 onwards, ROE improves steadily, turning positive at 1.58% in the first quarter of 2025 and reaching 8.75% by the second quarter of 2025. This suggests the company has transitioned from negative returns for shareholders to generating positive equity returns, aligning with improvements in profit margins.

Tax Burden

The tax burden ratio shows an increasing trend towards the end of the data period, rising from 0.76 at March 31, 2025, to 0.9 and then 0.97 in subsequent quarters. This indicates an improving situation with respect to income taxes affecting net profitability, reflecting a reduced tax impact on pre-tax earnings over the final periods.

Interest Burden

The interest burden ratio remains constant at 1 throughout the recorded period, suggesting no interest expense impact on earnings before taxes. This stability implies that the company may not be incurring significant interest expenses or that such expenses are negligible relative to earnings.

EBIT Margin

The EBIT margin exhibits a pronounced improving trend from negative percentages in earlier periods to positive by the end. Initial values show substantial losses, with margins as low as -21.18% in March 2022. However, over subsequent quarters, this margin steadily improves, becoming positive at 1.51% in March 2025 and further increasing to 6.77% in June 2025. This trend indicates enhanced operating efficiency and better control over costs.

Asset Turnover

Asset turnover ratios fluctuate in earlier quarters, starting at 0.72 and dipping to 0.57 before recovering. From December 2022 onward, the ratio stabilizes around 0.8 to 0.83 but drops to 0.7 again in June 2025. This suggests relatively consistent efficiency in generating revenue from assets, though the slight decline at the end may warrant monitoring.

Financial Leverage

Financial leverage demonstrates a general upward trend from 1.3 in early 2021 to a peak of 1.9 in June 2025. This increase indicates a growing use of debt or other liabilities relative to equity, which could amplify returns but also introduces higher financial risk.

Return on Equity (ROE)

ROE follows a pattern similar to EBIT margin, starting deeply negative at -20.85% and gradually recovering to positive values by March 2025. By June 2025, ROE reaches 8.75%, reflecting improved profitability and effective use of shareholders’ equity. The recovery trend in ROE aligns with the improvements seen in operating margins and financial leverage strategies.

Net Profit Margin

The net profit margin exhibits a predominantly negative trend from the first available data point in March 2021 through March 2024, starting at -9.57% and deteriorating significantly to reach a low of -20.74% in December 2021. Following this low, the margin gradually improves, becoming less negative through 2023 and early 2024. From March 2024 onwards, the trend reverses with the margin turning positive by March 2025 and progressively increasing, reaching 6.57% in the same quarter. This suggests an initial period of high losses followed by a steady recovery and eventual profitability.

Asset Turnover

Asset turnover data is first observed in March 2021, beginning at 0.72 and showing some fluctuation over the subsequent quarters. It peaks at 0.83 in several periods from December 2023 to June 2025, indicating improvement in the efficiency of asset utilization to generate revenue. Notably, there is a dip to 0.57 in September 2021, followed by recovery and stabilization around 0.8 in later periods. The ratio slightly declines to 0.7 by June 2025, but overall, the trend reflects increasing operational efficiency.

Return on Assets (ROA)

Return on assets follows a pattern similar to net profit margin, initially negative and worsening from -6.87% in March 2021 to a low of -14.09% in June 2022. Subsequently, ROA starts to recover steadily, becoming less negative through 2023 and early 2024. By March 2025, ROA turns positive at 0.96%, improving further to 4.61% by June 2025. This recovery indicates that asset profitability is improving, correlating with the enhanced asset turnover and the eventual shift to positive net profit margins.

EBIT Margin

The EBIT margin demonstrates a notable improvement over the analyzed periods. Initially negative, it shows a declining loss from -21.18% in March 2022 to a positive 6.77% by March 2025. This trend indicates an ongoing recovery in operational profitability, with margins shifting from deep losses towards profitability in recent quarters.

Asset Turnover

Asset turnover fluctuates moderately across the observed timeline. Starting at 0.72 in March 2021, it peaks around 0.83 in the December 2024 and early 2025 periods before a slight decline to 0.7 in the last quarter. The pattern suggests relatively stable efficiency in utilizing assets to generate revenue, with a tendency to improve and then somewhat normalize.

Return on Assets (ROA)

ROA follows a similar trajectory to EBIT margin but with less dramatic changes. It starts with negative values, indicating unprofitable asset returns, reaching the lowest point around -14.09% in June 2023 and improves steadily thereafter. By March 2025, ROA turns positive at 4.61%, reflecting enhanced overall asset profitability.

Tax Burden

The tax burden ratio is only available for the latest periods and shows an increasing trend from 0.76 to 0.97 between March 2024 and June 2025. This rising tax burden may indicate higher effective taxation relative to pre-tax profits, which could impact net margins going forward.

Interest Burden

The interest burden remains consistently at 1.0 across the available data points, implying that interest expenses have no attenuating effect on earnings before tax in the recorded quarters.

The financial ratios over the observed periods indicate several noteworthy trends and shifts:

Tax Burden

The tax burden ratio demonstrates a positive upward trend in the most recent periods. Starting from no available data in earlier quarters, the ratio increases to 0.76 in the first quarter of 2025 and peaks at 0.97 by mid-2025. This suggests an improving efficiency in tax-related expenses relative to pre-tax earnings, reflecting a potential optimization in tax management or changes in tax policy application.

Interest Burden

The interest burden remains stable and constant at a ratio of 1 across the available quarters towards the end of the data set. This stability signifies that interest expenses have a negligible or no impact on earnings before tax, indicating either minimal debt levels or very manageable interest expenses during this timeframe.

EBIT Margin

The EBIT margin reveals a significant improvement over time. Initially, the company experienced negative EBIT margins starting from -9.19% and progressively worsened to -21.18% in the early quarters. However, from late 2022/early 2023 onwards, a steady recovery occurs. By the first quarter of 2025, the margin turns positive at 1.51%, continuing to improve to 6.77% in mid-2025. This upward trajectory indicates effective cost control, increased operational efficiency, or revenue growth contributing to improved operating profitability over the periods.

Net Profit Margin

Similar to the EBIT margin, the net profit margin also follows a parallel recovery path. Starting with substantial losses near -9.57%, it further declines to nearly -20.74% before reversing course. From late 2022 onwards, the margin improves steadily, becoming positive by early 2025 at 1.15%, and rising to 6.57% in mid-2025. This suggests overall profitability enhancements, likely driven by the same factors influencing the EBIT margin, along with controlling other expenses and taxes.

In summary, the financial ratios convey a transition from sustained losses to profitability, accompanied by efficient interest expense management and an improving tax burden. These changes reflect positively on operational performance and financial health across the later quarters.