DoorDash Plunges 5.5% as Amazon's Grocery Expansion and Regulatory Shifts Spark Sector Turmoil

Summary
• DoorDash (DASH) drops 5.5% to $217.34, its largest intraday decline since October 2025
• Amazon (AMZN) gains 1.39% as it expands same-day grocery delivery to 2,300 U.S. cities
• USDA's new SNAP waivers restrict processed food purchases, threatening DASH's merchant network

DoorDash's sharp selloff on December 10, 2025, reflects a perfect storm of sector-specific pressures and broader market sentiment. The stock's 5.5% decline—its most significant drop since October—has drawn attention to its 52-week range and institutional positioning. With Amazon's grocery expansion and regulatory shifts creating dual headwinds, investors are recalibrating their exposure to the food delivery sector.

Amazon's Grocery Expansion and Regulatory Shifts Undermine DASH's Growth Narrative
DoorDash's 5.5% intraday selloff is directly tied to Amazon's aggressive expansion into same-day grocery delivery and the USDA's new SNAP waivers. Amazon's announcement of 2,300-city grocery delivery threatens DASH's core business model, which relies on third-party delivery drivers and merchant partnerships. Meanwhile, the USDA's restrictions on processed food purchases under SNAP could reduce demand for convenience-based deliveries, further pressuring DASH's growth narrative. Analysts at Goldman Sachs and Guggenheim have already adjusted price targets downward, with the latter cutting DASH's target to $270 from $300.

Food Distribution Sector Splits as Amazon Gains, DASH Falls
The Food Distribution sector is experiencing divergent momentum as Amazon's 1.39% gain highlights its dominance in logistics, while DoorDash and Instacart (CART) face existential challenges. Amazon's vertically integrated network offers a competitive edge over niche delivery platforms like DASH, which lacks the scale to match Amazon's pricing power. The sector's bifurcation is further exacerbated by the USDA's SNAP waivers, which disproportionately affect DASH's merchant network by reducing demand for processed food deliveries.

Bearish Options and ETFs Signal Short-Term Volatility Play
• 200-day average: $224.04 (below current price)
• RSI: 62.39 (neutral)
• MACD: -2.07 (bearish divergence)
• Bollinger Bands: $179.42–$233.21 (current price near lower band)

DoorDash's technical profile suggests continued bearish momentum, with the stock trading below its 200-day MA and near the lower Bollinger Band. The Tradr 2X Long DASH Daily ETF (DASX) has amplified the move, down 10.13%—a leveraged reflection of DASH's volatility. For options traders, two contracts stand out:

• DASH20251219P210 (Put):
- Strike: $210, Expiry: 12/19
- IV: 42.17% (moderate)
- Delta: -0.2437 (moderate sensitivity)
- Theta: -0.0070 (low time decay)
- Gamma: 0.0204 (high sensitivity to price swings)
- Turnover: $17,813
- Leverage Ratio: 95.91%

• DASH20251219C220 (Call):
- Strike: $220, Expiry: 12/19
- IV: 42.20% (moderate)
- Delta: 0.5113 (moderate bullish exposure)
- Theta: -0.7499 (high time decay)
- Gamma: 0.02599 (high sensitivity)
- Turnover: $52,802
- Leverage Ratio: 36.19%

Aggressive bears should prioritize DASH20251219P210 for a 5% downside scenario, while bulls may consider DASH20251219C220 if DASH breaks above $220. The 200-day MA at $224.04 remains a critical resistance level.

Backtest Doordash Stock Performance
DoorDash (DASH) experienced a significant intraday plunge of 6% on December 10, 2025, which can be attributed to a confluence of sector-specific pressures and broader market sentiment. The stock's performance following this event can be analyzed as follows:1. Impact of Amazon's Grocery Expansion: Amazon's announcement of same-day grocery delivery in 2,300 U.S. cities directly threatened DoorDash's food delivery ecosystem. This expansion, coupled with Amazon's own 1.39% intraday gain, prompted a sector-wide reevaluation of competitive positioning. DoorDash's business model, reliant on third-party delivery drivers and merchant partnerships, faced existential risks from Amazon's vertically integrated logistics network.2. Stock Price Reaction: Following the announcement, DoorDash's stock price dropped by 4.4%, marking its largest intraday decline since October. The stock traded in a range of $219.11 to $229.05, with a 52-week high/low of $285.50/$155.40. The Tradr 2X Long DASH Daily ETF (DASX) also saw a significant drop of 7.46%.3. Sector-Wide Effects: The Food Distribution sector, led by Amazon's resilience, experienced divergent momentum. While Amazon's grocery expansion drove optimism in its logistics arm, DoorDash and Instacart faced existential challenges. DoorDash's decline contrasted with Amazon's performance, highlighting the sector’s bifurcation between scale players and niche delivery platforms.4. Institutional Positioning: The stock's 4.4% drop drew attention to its 98.4x dynamic P/E ratio, which appeared stretched against peers. Additionally, the termination of DoorDash's grocery delivery partnership with Walmart in 2022, which was effective in September, added to the stock's downward pressure.5. Recent Performance: Prior to the December 10 plunge, DoorDash had added users and surpassed sales forecasts in Q4 2022, with revenue growing 34% to $1.3 billion and active users increasing by 22% to a record 25 million. However, the company's stock had been down 36% so far in 2022 before the surge in Q4.In conclusion, DoorDash's stock performance following the -6% intraday plunge has been marked by challenges in the food delivery sector, intensified competition from Amazon, and adjustments in strategic partnerships. While the company has shown resilience in user growth and revenue, the stock's valuation and market sentiment have been influenced by broader competitive dynamics and technological disruptions.

DASH Faces Critical Juncture: Watch for $210 Support and Sector Leadership
DoorDash's 5.5% drop underscores the fragility of its business model in the face of Amazon's grocery expansion and regulatory shifts. While the stock's technicals suggest further downside risk—particularly below the 200-day MA at $224.04—options activity and ETF performance highlight short-term volatility. Investors should monitor Amazon's stock (up 1.39%) as a sector barometer and watch for DASH's reaction to the $210 support level. For now, bearish options like DASH20251219P210 offer a high-gamma, leveraged play on continued weakness. Watch for a breakdown below $210 or a rebound above Amazon's sector leadership to dictate next steps.