Amazon and Uber Eats Team Up as DoorDash-Instacart Looms

Amazon will put Uber Eats restaurant delivery in front of Prime members with $0 delivery fees on orders of $25 or more — and DoorDash stock fell as much as 14% on the news Thursday before recovering some ground.

The move lands exactly one week after DoorDash announced plans to acquire grocery delivery giant Instacart, a deal Consumer Edge spending data suggests would hand the combined company roughly 77% of the overall delivery app market. Uber Eats holds 18%, per the same data, and had reportedly explored its own Instacart bid before the target swung to its biggest rival.

Now the counterpunches are stacking up.

The Amazon-Uber partnership, announced Thursday, lets customers browse and order from Uber Eats directly inside Amazon's website and app. It replaces an existing agreement with Grubhub that began in 2022, and an Amazon spokesperson said it will give Prime members "an even better restaurant delivery experience" with a wider selection. The numbers back that framing: availability in 10,000 cities, more than double the 4,000 cities where Grubhub operates.

Uber gets access to some portion of the estimated 200 million people who actively use Amazon Prime in the U.S. — a distribution channel few delivery operators can match.

What does the deal actually change for DoorDash?

Maybe less than Thursday's selloff implies. Amazon and Grubhub worked together for years, first with a free Grubhub+ subscription for Prime members in 2022, then in-app ordering in 2024. Grubhub CEO Howard Migdal called the partnership "meaningful" at the time and said it was the most successful third-party benefit Amazon had ever offered Prime members. The biggest challenge, he said, was making members aware it existed.

Grubhub still sits a distant third behind DoorDash and Uber Eats. A Grubhub spokesperson said the decision to end the partnership was mutual. Prime distribution, in other words, is not a guaranteed needle-mover — but the McDonald's piece of Uber's week might be.

The McDonald's deal cuts at DoorDash's volume

On Monday, Uber unveiled a major agreement making it McDonald's preferred white-label delivery partner. When customers order delivery through the McDonald's app, Uber gets first crack at fulfillment via Uber Direct — the platform that has struggled to keep pace with DoorDash Drive. That almost certainly means fewer of McDonald's $20 billion in annual delivery sales flow through DoorDash.

The two companies will also link loyalty programs: McDonald's Rewards members will be able to redeem points for Uber rides and earn points on McDonald's orders placed through the Uber Eats app. The concessions Uber made to land the deal aren't public, but having McDonald's — and Amazon — in its corner matters against any opponent.

DoorDash answers with Lyft

Overshadowed by the Amazon-Uber news Thursday was DoorDash's own expansion: its partnership with rideshare service Lyft now includes Lyft Go, a $9.99 monthly membership, at no additional cost. Lyft Go gives riders up to 8% cash back on eligible rides, spendable on Lyft or, now, on DoorDash. Lyft users will also be able to order from nearby restaurants mid-ride directly in the Lyft app.

The symmetry with Uber's model raises an obvious question: would DoorDash ever buy Lyft outright? At a market cap of about $6.47 billion, it would be a big one to swallow — though DoorDash has done bigger, including the proposed $17 billion Instacart acquisition.

A market where every move gets answered

The past month reads like a highlight reel. Uber Eats agreed to acquire corporate catering platform ezCater just over a month ago. Then came DoorDash-Instacart, then Amazon-Uber, then Uber-McDonald's, then DoorDash-Lyft. Each player is buying, partnering or bundling to avoid being priced out of the delivery race.

The lesson for operators watching from the sidelines: don't overreact to any single announcement in this market, because a counterpunch is probably already in motion. Given the pace of the past few weeks, nothing — including a DoorDash bid for Lyft — seems out of the question.