Delivery

Zomato Sees COVID-19 Response Delivering Faster Profitability

Indian food-delivery company Zomato weathered a decrease in revenue after COVID-19 hit — but at the same time saw an increase in profitability, founder and CEO Deepinder Goyal said in a blog post yesterday.

The privately held company saw revenue for the fiscal year that ended March 31, 2020, increase to $394 million, up from $192 million in fiscal 2019, the company reported. At the same time, the company reported, the annual net loss grew to $293 million from $277 million.

That annual revenue grew by 105 percent while the annual loss grew by only 6 percent indicates that the company is moving faster-than-expected toward profitability, Goyal wrote.

For the new fiscal year's first quarter, which ended June 30, the Zomato reported revenue of $41 million and a net loss of $12 million — a significantly lower loss per dollar in revenue than during the two full fiscal years.

The company usually releases annual data in April but held off this year due to COVID-19's sudden impact, Goyal said.

Goyal also said Zomato saw a significant increase in fiscal 2020 in its Gross Merchandise Volume — a measure of business activity used in some online industries to assess how much of a product a company is delivering even if it never takes ownership of that product.

“In the last few quarters...we fast-tracked our efforts towards making our business profitable and drove efficiency into our spends,” Goyal said. “While COVID-19 has impacted the size of our business, it has accelerated our journey to profitability. In terms of the size of the business, COVID-19 has set us back by a year or so — but a year is only a small blip when you are building a company for the next 100 years.”

Today’s earnings news follows a difficult few months — in addition to the economy-wide challenges wrought by COVID-19 — for Zomato. The company announced in early July that an expected $100 million investment from China’s Ant Financial was put on hold because India had adopted new legal barriers to foreign investment. Ant Financial previously invested $150 million in Zomato.

Additionally, at last one news outlet reported in May that Indian authorities tasked with preventing anti-competitive behavior were investigating Zomato's purchase, recently completed at the time, of Uber Eats India for $206 million.

 

——————————

NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

TRENDING RIGHT NOW