DoorDash is making its biggest bet yet beyond food delivery, announcing it will acquire the hospitality software company SevenRooms in a $1.2 billion cash and equity deal. The move signals DoorDash’s ambition to redefine how restaurants engage with customers and manage their operations as competition mounts in the restaurant technology sector.

A Strategic Leap Into Restaurant Tech

On May 6, DoorDash said it had entered into a definitive agreement to acquire SevenRooms, a platform best known for its reservation, guest management, and marketing tools used by thousands of restaurants, hotels, and other hospitality operators across more than 100 countries. The agreement underscores DoorDash’s intent to become more than just a delivery service: it is betting that offering merchants advanced tools to manage every step of the guest journey will deepen its relationship with restaurants and shore up its growth prospects.

“Empowering local economies means building technology that helps businesses operate more efficiently, reach new customers, and deliver best-in-class hospitality,” said DoorDash in its own announcement. “Together, we strive to provide operators with an integrated platform to serve, engage, and retain guests better,” the company said.

DoorDash did not disclose how the $1.2 billion deal would be split between cash and equity. The transaction is expected to close later in 2025, subject to regulatory approvals and closing conditions.

A New Battleground: Guest Experience

DoorDash’s core business has soared since the pandemic, but as growth moderates and competitors like Uber Eats and Grubhub invest heavily in new offerings, DoorDash is seeking to differentiate itself by becoming indispensable to restaurants, not just consumers.

SevenRooms gives DoorDash an instant foothold in the fast-evolving market for hospitality software services. SevenRooms’s platform empowers restaurants to manage reservations, automate waitlists, enhance customer relationship management, and deploy targeted marketing directly to guests. Its clients include an array of independent operators as well as larger hospitality groups, providing insights into guest preferences, spending habits, and loyalty.

“By integrating SevenRooms’ robust suite of solutions with DoorDash’s existing services, merchants will be able to access more tools to improve guest experiences and grow their businesses,” DoorDash said in its announcement.

The deal aligns with recent strategic moves in the sector, such as Toast’s push into restaurant software, Resy’s growth under American Express, and OpenTable’s expansion. DoorDash’s play could help it capture more data across both the delivery and dine-in sides of the restaurant business.

Wall Street Reacts as Revenue Misses Estimates

DoorDash revealed the SevenRooms acquisition as it reported its first-quarter earnings. The company posted revenue of $2.51 billion, up from $2.04 billion in the year-ago period, but slightly below Wall Street estimates. Gross order value rose 21% to $19.2 billion, and the company reaffirmed its annual guidance, but shares fell as much as 13% in midday trading following the results.

The earnings miss—paired with DoorDash’s decision to make a large strategic acquisition—sparked debate among analysts and investors. Some see the deal as a smart move to tie merchants closer to the platform, but others question the timing as growth across the broader food delivery sector cools post-pandemic and consumer spending shows signs of slowing.

“DoorDash’s acquisition of SevenRooms marks a significant step in its evolution from a last-mile logistics provider to a comprehensive merchant services platform,” said Bernstein’s Nikhil Devnani in a note, adding that the near-term impact would be limited but could “create stickier, high-value relationships with merchants” over the long run.

Building a Full-Stack Merchant Platform

This acquisition is DoorDash’s largest since its initial public offering in 2020 and highlights CEO Tony Xu’s strategy to develop a one-stop shop for restaurants—helping them acquire, serve, and retain customers in an increasingly digital dining economy. In recent years, DoorDash has steadily expanded its merchant services with offerings like Storefront (online ordering), advertising, and loyalty programs.

SevenRooms CEO Joel Montaniel wrote in a blog post that after 13 years of building, the company was “thrilled to take the next step in our journey.” DoorDash said SevenRooms would continue to operate under its own brand and “remain committed to serving all operators and partners, including those who are not customers of DoorDash.”

DoorDash’s broader vision is to help restaurants build direct relationships with the diners who order online and visit in person. Unlike many third-party reservation platforms, SevenRooms enables operators to own their guest data and communicate directly with customers—a key factor in building loyalty and repeat business.

Intensifying Restaurant Tech Arms Race

The restaurant industry has rapidly digitized since COVID-19, giving rise to a sprawling ecosystem of software providers tackling everything from reservations and waitlists to loyalty and marketing campaigns. DoorDash is betting that by combining its logistics and discovery platform with SevenRooms’s guest management capabilities, it can offer an end-to-end solution that locks in restaurants and enables new revenue streams.

Investors will be watching closely for signs that SevenRooms can deliver growth at scale without diluting DoorDash’s focus or margins. For now, the company and its new acquisition face the challenge of integrating operations while continuing to compete against well-capitalized rivals.

As consumer eating habits continue to evolve, DoorDash’s wager on the digital guest experience marks its most audacious step yet in the quest to power the modern restaurant industry—one reservation, order, and marketing campaign at a time.