Zomato Q3: Profit Nearly Quadruples QoQ To INR 138 Cr

Posting its third consecutive profitable quarter, foodtech major Zomato on Thursday (February 8) reported a consolidated profit after tax (PAT) of INR 138 Cr in the December quarter (Q3) of the financial year 2023-24 (FY24), helped by a sharp growth in its quick commerce business.

Its PAT jumped 283% from the previous quarter’s INR 36 Cr. The company had reported a net loss of INR 346.6 Cr in Q3 FY23.

Zomato’s operating revenue jumped to INR 3,288 Cr in Q3 FY24 from INR 2,848 Cr in Q2 FY24. This was also a 68% rise year-on-year (YoY) from an operating revenue of INR 1,948.2 Cr in Q3 FY23.

Zomato reported a 47% YoY and 13% quarter-on-quarter (QoQ) rise at INR12,886 Cr for its gross order value (GOV) for the B2C businesses. However, the company’s food delivery business growth remained subdued, which it attributed to a muted demand environment in the broader restaurant industry.

The company’s food delivery GOV grew 27% YoY and a mere 6.3% QoQ to INR 8,486 Cr in Q3 FY24. On the other hand, Zomato’s quick commerce business Blinkit witnessed a 103% YoY and 28% QoQ growth in GOV to INR 3,542 Cr in the reported quarter.

After turning contribution positive for the first time in Q2 FY24, Blinkit’s contribution as a percentage of GOV increased to 2.4% in Q3 from 1.3% in the prior quarter.

On the profitability front, Zomato’s consolidated adjusted EBITDA was positive for the third consecutive quarter at INR 125 Cr, improving from INR 265 Cr loss in the previous year’s quarter.

While the adjusted EBITDA in Zomato’s food delivery business stood at INR 252 Cr in Q3 FY24, the adjusted EBITDA loss in Blinkit declined to INR 89 Cr.

Zomato said that Blinkit’s growth was largely driven by the robust uptick in demand due to multiple festivals and occasions in the quarter.

“This growth was also fuelled by having the right assortment which addressed the most pertinent needs of our customers,” said Zomato in its statement. “The team also ensured consistently high service levels through minimal stock-outs and adequate delivery partner availability during periods of peak demand.”

Blinkit said it also added 40 net new stores in Q3, taking the total store count to 451 at the end of the quarter.

On the other hand, Zomato’s B2B business, Hyperpure, also witnessed growth during the reported quarter. Its revenue jumped 104% YoY INR 859 Cr in Q3.

How Zomato Spent?

Zomato’s total expenses jumped over 36% to INR 3,383 Cr in the reported quarter from INR 2,485 Cr in the year-ago period.

Delivery Charges: Delivery and related charges continued to account for the biggest chunk of expenditure. It grew to INR 1,068 Cr in Q3 FY24 from INR 655 Cr in the year-ago quarter. 

Purchase of Stock-in-Trade: Zomato spent INR 783 Cr in this bucket, which jumped more than 99% YoY in line with its growing business.

Employee Cost: The company spent INR 423 Cr in this bucket in Q3 FY24 against INR 395 Cr a year ago.

Following the Q3 earnings announcement, shares of Zomato jumped 4.6% to INR 147 on the BSE on Thursday (February 8).