Zomato Q3: Blinkit Posts Second Consecutive Contribution Positive Quarter

Zomato’s quick commerce vertical Blinkit continued to scale up and was contribution positive for the second consecutive quarter in the three-month period ended December 31, 2023. 

In its shareholders letter, Zomato said Blinkit’s contribution margin, as a percentage of gross order value (GOV), in the overall business further improved to 2.4% in Q3 FY24 from 1.3% in Q2 FY24. 

The company defines contribution as adjusted revenue sans dark store operations cost, delivery, packaging and other expenditures.

“In Q3 FY24, close to 70% of our stores were contribution positive and ~20% of these were operating at a 5%+ contribution margin resulting in a growing pool of contribution profit, which is creating room for investing in new stores while also continuing to improve the aggregate contribution margin,” Blinkit cofounder and CEO Albinder Dhindsa said. 

Overall, Blinkit clocked a revenue of INR 644 Cr in Q3 FY24 as against INR 301 Cr in the year-ago quarter and INR 505 Cr in Q2 FY24. The quick commerce vertical’s adjusted EBITDA loss further improved to INR 89 Cr in the quarter ended December 2023 from INR 227 Cr in Q3 FY23 and INR 125 Cr in Q2 FY24. 

On the back of festive growth, Blinkit’s operational and financial metrics saw a major spurt. While GOV soared 103% year-on-year (YoY) to INR 3,542 in the quarter ended December 2023, average order value (AOV) jumped 14% YoY to INR 635 in Q3 FY24. 

Dhindsa attributed the uptick in demand to the festive season and said a major chunk of the GOV growth was order volume-led. He also said that the GOV was further beefed up by an increase in AOV, which benefited from a higher mix of high average selling price categories.

The company also added 40 net new stores during the quarter, taking the total store count to 451 at the end of December 2023. 

Overall, Zomato reported its third consecutive profitable quarter. Its consolidated net profit  quadrupled sequentially to INR 138 Cr in Q3 FY24. Meanwhile, the foodtech major’s operating revenue jumped 68% YoY to INR 3,288 Cr in Q3 FY24.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.