Eternal Ltd (formerly Zomato) on Thursday released its fiscal fourth quarter earnings report with a profit of Rs 39 crore, plummeting by 77.71 per cent in comparison to Rs 175 crore reported during the corresponding quarter of FY24. However, the company posted revenue from operations at Rs 5,833 crore, up 63.76 per cent as against Rs 3,562 crore reported during the fourth quarter of previous financial year. The company EBITDA stood at Rs 72 crore, down 16.3 per cent YoY.
Albinder Dhindsa, CEO of Blinkit, maintained that the increase in losses was expected and in line with the company’s plan to pull-forward expansion of its store network. “We added 294 net new stores in Q4FY25, making it our highest-ever net store addition in a single quarter. As a result, ~40 per cent of our overall network of 1,301 stores are underutilized stores, opened in the last two quarters alone (216 in Q3FY25 and 294 in Q4FY25). We also added 1 million sqft of new warehousing space to support the store expansion,” he said.
Despite that, he added, the contribution margin (which includes all expansion costs except capex) increased from 3.8 per cent to 3.9 per cent of NOV. “Below contribution, we increased our investment in marketing to meaningfully accelerate our pace of new customer acquisition. As an outcome, average monthly transacting customers increased to 13.7 million in Q4FY25 (up from 10.6 million in Q3FY25). Margin expansion, especially in the more mature parts of our network, could have been higher if not for the heightened competitive intensity,” Albinder Dhindsa added.
Food delivery GOV and NOV grew by 16 per cent YoY (-1 per centQoQ) and 14 per cent YoY (-3 per cent QoQ) respectively, while Adjusted EBITDA margin (% of GOV) continued to improve (up 110bps YoY/ 10bps QoQ to 4.4 per cent in Q4FY25).
Akshant Goyal, CFO of Eternal (formerly Zomato), said, “NOV of the company’s B2C businesses grew 53 per cent YoY (5 per cent QoQ) to Rs 17,440 crore in Q4FY25. On a like-for-like basis (excluding the impact of the acquisition of Paytm’s entertainment ticketing business), NOV growth was 48 per cent YoY (5 per cent QoQ).
Meanwhile, Zomato’s B2B business Hyperpure’s revenue grew 93 per cent YoY (10 per cent QoQ). Consolidated Adjusted Revenue grew by 60 per cent YoY to Rs 6,188 crore. On the profitability front, consolidated Adjusted EBITDA dropped by 15 per cent YoY to Rs 165 crore in Q4FY25, largely on account of the accelerated investments in expanding the quick commerce store network, which was partly offset by the improvement in food delivery Adjusted EBITDA margin to 5.2 per cent from 3.8 per cent a year ago.
Blinkit witnessed the highest ever store addition with 294 net new stories during the quarter and is on track to reach 2,000 stores by Dec-25.
Food delivery growth slows sharply
Deepinder Goyal, CEO of Zomato, maintained that the growth in food delivery was slowed due to reasons including, sluggish demand environment, shortage (temporary) of delivery partners due to high demand of delivery partners in quick commerce given the rapid expansion of the industry in the last few months, and competition from quick delivery of packaged food from quick commerce leading to drop in demand for food delivery from restaurants. Besides these, he added that during the quarter, there are two other factors that impacted growth: “1. We delisted ~19,000 restaurants who either a) did not pass muster on hygiene standards based on severe customer escalations, b) were mimicking established brands and misleading customers, or c) operating multiple identical menu listings to hog more listing impressions. As one of the leading food delivery platforms, we think it is critical to weed out bad actors which erode trust in the category. While this did impact order volumes, this was the right thing to do for the long term. 2. There was one less day in Q4FY25 compared to the same period last year (which was a leap year),” he elaborated.