DoorDash announced Thursday morning that it has agreed to buy Instacart in a deal valued at about $17 billion, combining the country's largest restaurant delivery app with the company that has long led third-party grocery delivery.

The announcement confirms reporting from earlier this week. The Wall Street Journal first reported Monday that the two companies were in advanced talks. Instacart had also been talking with Uber, but those discussions were no longer active, according to Reuters.

For shoppers, the short version: nothing changes … yet.

The deal isn't expected to close until the end of 2027 or the first half of 2028. It still needs approval from Instacart shareholders and from antitrust regulators in the U.S., Canada and Israel. Shareholders holding about 19% of Instacart's stock have already agreed to vote yes.

Until then, the two companies will keep operating separately. "Nothing changes today about how you shop with Instacart," Instacart CEO Chris Rogers wrote in a note to the company's shoppers.

DoorDash says it plans to keep the Instacart brand and app after the deal closes. The companies also made a handful of promises about what the combined company would look like:

DoorDash CEO Tony Xu pitched the deal as a way to help local grocers compete online, arguing that "when more people shop local, more dollars stay local."

But delivery apps make money from both sides of a grocery order. Customers pay delivery and service fees, and grocers pay the apps a cut of each sale. Instacart typically charged stores a commission of more than 10% per order, The Wall Street Journal reported in 2020. That's a significant cost in an industry where the average food retailer's profit margin was 2.1% last year, according to FMI, the grocery industry's trade group. Many retailers cover those costs by marking up prices in the apps.

DoorDash started in restaurant delivery but has pushed hard into groceries, convenience stores and retail. It now delivers from major chains including Kroger (Fred Meyer and QFC) and Albertsons (Safeway).

The bigger targets are Walmart and Amazon, which have spent years building their own fast-delivery operations. Walmart accounts for about 31% of U.S. online grocery sales and Amazon about 24%, according to figures cited by Wedbush analysts. A combined DoorDash-Instacart would be in a stronger position to take them on.

This isn't DoorDash's first run at Instacart. It bid for the company in 2021, at a significantly higher valuation, Semafor reported.

On paper, the deal has some clear perks for shoppers. Households that pay for both DashPass and Instacart+ could save on membership fees, and Instacart users would be able to order from more stores in one app.

But it would also concentrate delivery in fewer hands. DoorDash accounts for about 59% of U.S. delivery app spending and Instacart about 18%, with Uber Eats just under 20%, according to Consumer Edge data. Those figures cover all delivery, not just groceries, but combined, DoorDash and Instacart would control roughly three-quarters of that market. Uber Eats and Walmart's and Amazon's own delivery services would remain, but shoppers and stores would have fewer places to turn if fees go up. DoorDash says it won't require grocers to work with it exclusively, and federal antitrust regulators will review the deal before it can close.

Delivery apps already cost shoppers more than buying the same groceries in person. Last December, Instacart agreed to pay $60 million in customer refunds to settle Federal Trade Commission allegations that it advertised "free delivery" while charging mandatory service fees of up to 15% of an order, and signed customers up for Instacart+ without clear consent. Instacart denied wrongdoing. That same month, an investigation by Consumer Reports and Groundwork Collaborative found Instacart showing different shoppers different prices for the same items at the same store, in some cases by more than 20%. Instacart said those tests are randomized and run by a small number of retailers.

Nothing announced Thursday addresses fees or item prices beyond the membership promise.

Then there's the question of which stores stay. Instacart delivers from Walmart; DoorDash stopped offering Walmart delivery in 2022. Whether Walmart sticks around on a DoorDash-owned Instacart is an open question.

If you use either app, nothing changes for now. If you pay for both DashPass and Instacart+, don't cancel anything in anticipation of a combined plan; that's at least a year away, assuming the deal closes at all. And as always, the cheapest grocery order is usually still the one you pick up yourself.

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