Zomato Q3 Results: Profit Surges Nearly Fourfold, Revenue Up 15%
Zomato's Q3 revenue rose 15.4% to Rs 3,288 crore as against Rs 2,848 crore in the previous quarter.
Zomato Ltd.'s net profit grew nearly fourfold and beat analysts' estimates in the October–December period, which marks the third consecutive profitable quarter on a consolidated basis.
The food delivery platform's profit increased to Rs 138 crore in the quarter ended December, according to an exchange filing on Thursday. Analysts polled by Bloomberg had projected a consensus estimate of Rs 86.1 crore.
Zomato Q3 FY24 Earnings Highlights (Consolidated, QoQ)
Revenue up 15.4% at Rs 3,288 crore vs Rs 2,848 crore (Bloomberg estimate: Rs 3,099.7 crore).
Ebitda at Rs 51 crore vs loss of Rs 47 crore (Bloomberg estimate: Rs 22.3 crore).
Net profit up nearly fourfold at Rs 138 crore vs Rs 36 crore (Bloomberg estimate: Rs 86.1 crore).
"We continued to build on the momentum in the first two quarters of FY24," said Akshant Goyal, chief financial officer at Zomato.
Zomato's gross order value across businesses such as Hyperpure, Blinkit and food delivery grew 13% sequentially to Rs 12,886 crore. "On an annualised basis, we have now crossed Rs 50,000 crore of GOV in our B2C businesses," Goyal said.
Zomato expects gross order value to continue growing at over 20% year-on-year, and accelerate if "we see more than expected market share gains and revival in macro consumer demand".
Its adjusted Ebitda profit is now at over Rs 1,000 crore. "We expect both margin expansion and GOV growth to drive further improvement in absolute profits," said Chief Executive Officer Deepinder Goyal.
At quick commerce arm Blinkit, gross order value grew at over 100% year-on-year. "Losses continue to decline and we are on track to meet our guidance of adjusted Ebitda break-even on or before Q1 FY25," Deepinder said in a shareholders' letter.
On Gold pricing, food delivery CEO Rakesh Ranjan said the program is currently "being used tactically to acquire (and re-acquire) customers and hence, the pricing of the membership program is much lower than what we would want it to be".
"Customers have more than one option and hence we have to remain competitive on pricing. We are also seeing a lot of customers switching platforms at the time of membership renewal, depending on who is offering the lowest price. While there is no debate on the need for a loyalty program, we are yet to get to sustainable pricing here," he said.
Platform fee, introduced in July 2023, helped in margin improvement for Zomato, but the Gurugram-based company didn't commit to a pricing band for it.
"I think it is too early to predict how the platform fee will shape up. Much like the Gold program, we are still testing the waters on what works and makes sense here, from a long term perspective. We will continue to tactically use levers like these to optimise both growth and margin expansion," Ranjan said.
Shares of Zomato ended 2.4% higher at Rs 144 apiece on the BSE, as compared with a 1% decline in the benchmark Sensex.
