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Just For You Instacart's Pricing Tests Spark Backlash... But Investors Didn't CareAuthored by Jordan Chussler. Published: 12/22/2025. 
At a Glance - Instacart’s AI-enabled price tests drew backlash and regulatory attention, but the company says the tests weren’t based on personal data.
- The FTC’s $60 million settlement is a significant blow to Instacart's trust, yet it doesn’t directly alter Instacart’s core demand drivers or unit economics.
- After a brief pullback, the stock rallied to within reach of where it was before the news broke as investors shook off the news and focused on the future.
America's favorite grocery ordering and delivery app came under pressure earlier this month after a consumer advocacy investigation raised concerns about its pricing practices and transparency. A joint investigation conducted by Consumer Reports and Groundwork Collaborative and published on Dec. 9 found that Maplebear (NASDAQ: CART), which does business as Instacart, ran pricing experiments that caused different customers to see different prices for identical items — a practice Consumer Reports said does not meet the definition of surveillance pricing. Free book reveals best crypto play for right now
The smart money sees something most investors don't. A potential rally setting up… and now could be the perfect time to get positioned. Get your FREE copy of this must-read book. The scrutiny intensified days later when the U.S. Federal Trade Commission (FTC) announced on Dec. 18 that it was levying a $60 million penalty against the company for "deceiving consumers with false advertising, failure to provide refunds and unlawful subscription enrollment processes" in an unrelated enforcement action. This year the stock has underperformed the market, as has much of the consumer staples sector. Still, since its year-to-date low on Nov. 6, Instacart is up more than 31%. When the Consumer Reports investigation first broke, CART shares dropped about 6%, but they rebounded nearly as quickly in the following days. Here's why investors largely shrugged off the controversy around the pricing experiments and why the FTC penalty didn't derail shareholders' longer-term expectations. How Instacart's Pricing Tests Created Price Differences The largest online grocery ordering and delivery app, Instacart serves approximately 14.9 million customers — up from 14.4 million in 2024 — and has an army of roughly 600,000 shoppers. Like other companies leveraging AI, Instacart used the technology to run short-term, randomized A/B pricing tests to gauge price sensitivity at an aggregate level. The AI system, which the company implemented as early as 2022, supported these short-term experiments rather than performing real-time, demand-based dynamic pricing. Consumer Reports found that "many U.S. shoppers who order grocery deliveries through Instacart are unknowingly part of widespread AI-enabled experiments that price identical products differently from one customer to the next." Those prices could vary by as much as 23% for an individual item between customers — a technique the company reportedly refers to as "smart rounding," according to an inadvertently released email. However, the strategy was not entirely hidden from investors. Consumer Reports noted that Instacart had disclosed its pricing experiments in corporate marketing and investor materials, even as those documents indicated shoppers were not informed they were participating in the tests. Instacart maintains that its retail partners ultimately set base prices on the platform, while Instacart provides the infrastructure that can be used to run pricing experiments. Why Investors Shrugged off the Bad News Instacart denied engaging in surveillance pricing, saying it does not use — and does not allow partners to use — personal, demographic, or user-level behavioral data to set prices. Charging different prices for products to different customers is not illegal in the U.S., nor is it a new practice. The distinction between dynamic pricing and surveillance pricing can be fuzzy, but many companies regularly adjust prices based on factors such as demand, location and timing. For example, rideshare companies like Uber (NYSE: UBER) and Lyft (NASDAQ: LYFT) use dynamic — or surge — pricing during periods of high demand. Their platforms adjust fares according to supply and demand, traffic, time of day and even weather. Investors also have to weigh Instacart's underlying business performance. The company was profitable before its Sept. 19, 2023 IPO, has averaged roughly 10.15% revenue growth over the last four quarters, and its net cash from operating activities rose by nearly 88%. From an earnings perspective, the trend is similar: Instacart has beaten expectations in seven of the past eight quarters, missing revenue estimates only twice over the same period. Wall Street Remains Bullish on CART Industry analysis firm Grand View Research estimates the global online grocery market was worth more than $67 billion in 2024 and is forecast to grow at a compound annual growth rate (CAGR) of 36.8% from 2025 to 2033. That growth would lift the market to an expected value of more than $992 billion by the end of the forecast period, and Instacart is positioned as an important participant in that expansion. The outlook has helped shape a bullish consensus on Wall Street: the 27 analysts covering CART assign it a consensus Moderate Buy rating, with an average 12‑month price target roughly 14% above current trading levels. Institutional ownership is over 63%, and institutional investors have contributed about $3.73 billion in inflows to Instacart over the past 12 months versus $1.4 billion in outflows. Meanwhile, short interest stands at 6.58% of the float (about $537 million), a decrease of nearly 29% from the prior period when it was $734 million.
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