Zomato’s Q1 net profit jumps to ₹253 cr

Food delivery company Zomato reported a consolidated profit of ₹253 crore for the first quarter (Q1) of the fiscal year 2024-25 (FY25), a notable increase from the ₹175 crore profit reported in the quarter ending March 31, 2024. This marks a huge improvement from the ₹2 crore profit achieved during the same period last year (Q1 FY24). Zomato's total expenses also rose, amounting to ₹4,203 crore in the quarter ending June 2024, compared to ₹3,636 crore in the previous quarter and ₹2,612 crore in the corresponding period of the previous year.

The food delivery platform’s revenue from operations surged by 74% year-on-year (Y-o-Y), reaching ₹4,206 crore in Q1, up from ₹2,416 crore in the corresponding period of the previous year and ₹3,562 crore in the quarter ending March 2024.

Consolidated Adjusted EBITDA increased by ₹287 crore YoY to ₹299 crore in Q1FY25, due to margin growth in all four business segments. The business turned Adjusted EBITDA positive in Q1FY24, and in the past year, we have reached an annualised profit of ₹1,200 crore, Akshant Goyal, Zomato's chief financial officer states in a blog post.

Additionally, Zomato plans to expand its quick commerce segment, Blinkit, with a target of reaching 2,000 dark stores by 2026.

“As of now, we see a line of sight of getting to about 2,000 stores for our current business. Most of these stores would be in the top 10 cities in India. Beyond the large cities, the size of the market is still undiscovered. How fast we are able to get to this store count will depend on how well we execute. If everything goes as planned, we plan to get to 2,000 stores, latest by the end of 2026 while remaining profitable,” said Albinder Dhindsa, chief executive officer, Blinkit.

Recently, Deepinder Goyal, the founder and CEO of Zomato, has entered the "billionaire's club" as Zomato's stock reaches an all-time high. The company’s shares hit a 52-week peak, and its market capitalization surpassed ₹2 lakh crore for the first time on July 15, 2024. This milestone follows Zomato’s recent increase in platform fees to ₹6 per order. Previously, in April 2024, the company had raised its platform fee by 25% to ₹5 per order and discontinued its inter-city food delivery service, ‘Intercity Legends’.

After introducing a platform fee of ₹2 in August 2023, the food delivery company aimed to improve its profit margins. This fee was later increased to ₹3 in October and further to ₹4 before the most recent adjustment on January 1. Additionally, the fee was temporarily raised to ₹9 on December 31, 2023, but was subsequently reduced.