Zomato Share Price Declines For 2nd Day; Reports 57% YoY Drop in Q3 Results

Food delivery company Zomato reported a 57% year-on-year drop in its Q3 FY25 net profit, which fell to ₹59 crore. However, revenue surged 64% to ₹5,405 crore, with a 13% sequential growth. Despite the revenue increase, PAT declined sharply compared to Q2 FY25.

Gross Order Value (GOV) Performance

Zomato’s Gross Order Value (GOV) for its B2C businesses grew by 57% year-on-year, totalling ₹20,206 crore in Q3 FY25. The GOV also rose by 14% on a quarter-on-quarter (QoQ) basis.

In its shareholder letter, Zomato acknowledged a broad-based slowdown in demand, which began in the second half of November. The company noted that its long-term growth target for GOV in the food delivery business remains over 20% year-on-year, despite the current slowdown.

Excluding the impact of the acquisition of Paytm’s entertainment ticketing business, GOV growth was 52% year-on-year and 12% on a QoQ basis.

Segment-wise GOV Growth:

• Food Delivery GOV: Grew by 17% year-on-year.
• Quick Commerce GOV: Surged by 120% year-on-year.
• Going-Out GOV: Increased by 191% year-on-year.

Profitability

Zomato’s consolidated adjusted Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) grew 128% year-on-year, largely driven by an improvement in the food delivery adjusted EBITDA margin (as a percentage of GOV), which increased to 4.3% compared to 3% a year ago.

On a QoQ basis, consolidated adjusted EBITDA declined by 14%, or ₹45 crore, despite improved margins in food delivery. The company attributed the decline to accelerated investments in expanding Zomato’s quick commerce store network, which led to higher losses in this segment.

Zomato’s losses in the quick commerce business were mainly due to pulling forward growth investments that were planned to be made over the next few quarters, said Founder and CEO Deepinder Goyal.

Quick Commerce Expansion

Zomato aims to reach its target of 2,000 quick commerce stores by December 2025, earlier than its original guidance of December 2026.

In the last 2 quarters, the company added 368 new stores, compared to 152 in Q2 FY25 and 216 in Q3 FY25, bringing the total number of stores to 1,007.

Zomato also expanded its warehousing space, adding 1.3 million square feet of space, which accounts for over 30% of the company’s total warehousing network.

Share Price Performance

Zomato’s share price traded 7.92% lower at ₹220. 75 at 9:40 AM on the NSE. The stock opened at ₹223 lower than ₹239.75 at the previous close. The stock dropped more than 3% in yesterday’s trade.

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