Foodtech major Zomato announced its financial results for the third quarter (Q3) of the financial year 2023-24 (FY24) on February 8, 2024. Here are the key highlights:
Profit Quadruples Sequentially: The Delhi NCR-based startup reported its third consecutive profitable quarter. Net profit stood at INR 138 Cr in Q3 FY24 against a loss of INR 347 Cr in the year-ago quarter, on the back of a sharp growth in quick commerce vertical Blinkit. The net profit increased 283% from INR 36 Cr in the preceding September quarter.
Operating revenue rose to INR 3,288 Cr during the quarter under review, an increase of 69% from INR 1,948 Cr in the corresponding quarter of last year. Gross order value (GOV) increased 47% year-on-year (YoY) to INR 12,886 Cr.
Food Delivery Crosses INR 2,000 Cr Sales: Zomato’s food delivery vertical reported an adjusted revenue of INR 2,205 Cr in Q3 FY24, a 29% increase from INR 1,565 Cr in the year-ago quarter. However, the growth in GOV for the food delivery business was lower than the company’s expectation in the quarter.
“…the demand environment was muted in the last quarter (Q3FY24) and that is true even for the broader restaurant industry. Hence, food delivery GOV growth (at 6.3% QoQ/ 27% YoY) was lower than our expectations but still higher than some of the other players in the restaurant industry space,” the company said in its shareholders’ statement.
The GOV for the vertical stood at INR 8,486 Cr in Q3 FY24. Adjusted EBITDA for the vertical zoomed 11X to INR 252 Cr from INR 23 Cr in Q3 FY23, while average monthly transacting customers rose 8% to 18.8 Mn in Q3 FY24 from 17.4 Mn in the year-ago quarter.
Blinkit Sees Hypergrowth: The quick commerce business reported a robust growth on the back of festival demand. Blinkit’s revenue increased to INR 644 Cr in Q3 FY24, a 114% increase from INR 301 Cr in Q3 FY23. Blinkit accounted for almost 18% of the startup’s overall revenue and the vertical was contribution positive for the second consecutive quarter.
Its average order value increased to INR 635, a 15% increase from INR 553 in the year-ago quarter. Average monthly transacting users on the platform increased 74% YoY to 5.4 Mn from 3.1 Mn.
Blinkit added 40 net new stores during the quarter under review, taking the total store count to 451. Zomato said Blinkit for the first time entered Agra and Goa in Q3 FY24.
Hyperpure & Going-Out Witness Steady Growth: Hyperpure, the B2B arm which supplies fruits, vegetables and groceries to restaurants, saw its revenue more than double to INR 859 Cr during the December quarter from INR 421 Cr a year ago.
Zomato founder Deepinder Goyal also said that Hyperpure is now setting up a plant for processing value-added food supplies, including, sauces, spreads, pre-cut and semi-finished perishable products.
Meanwhile, Zomato’s events ticketing platform, Going-Out, reported a revenue of INR 73 Cr against INR 58 Cr in Q3 FY23. The startup said the platform has been launched in nine cities in India.
Platform Fees, Zomato Gold & More: Zomato said it is yet to get to “sustainable pricing” for its loyalty programme Zomato Gold. The company said a lot of customers are switching platforms at the time of membership renewal, depending on who is offering the lowest price. As such the company has to remain competitive on pricing. Goyal said Zomato is using Zomato Gold “tactically” to acquire customers.
On the platform fee, Goyal said Zomato is still “testing the waters” about the pricing of platform fee. It is pertinent to note that Zomato introduced platform fees on food order in July last year.
Zomato also touted the improvement in its ad monetisation, which has resulted in consistent quarter-on-quarter increase in ad revenue per order over the last several quarters.
Blinkit cofounder Albinder Dhindsa said that the quick commerce vertical’s ad revenue grew 220% YoY in Q3 FY24 against 103% YoY growth in its GOV during the quarter. He said the platform has emerged as a preferred advertising platform for large as well as emerging brands.
“Revenue concentration of the top 20 advertisers has fallen from 61% in Q3 FY23 to 40% in Q3 FY24 despite a 108% YoY growth in ad spends by the top 20 advertisers,” he added.
Shares of Zomato ended Thursday’s trading session 2.4% higher at INR 144 on the BSE post the announcement of the Q3 results.
