Foodtech unicorn Zomato posts wider FY20 loss; revenue doubles
Food delivery unicorn Zomato posted a wider loss of Rs 2,385.6 crore for the year ending March 31, 2020, on the back of increased expenses, as well as a pandemic-induced lockdown, which hit the online food delivery business in March. In the previous year, Zomato's losses stood at Rs 1,001 crore.
Consolidated revenues, however, jumped 96.3 percent to Rs 2,742.7 crore in FY20 from Rs 1,397 crore in FY19. Total expenses rose 39.14 percent to Rs 5,006.3 crore, as per the Registrar of Companies (RoC) filings of the Gurugram-based foodtech unicorn.
According to the statement, Zomato said the COVID-19 pandemic, which hit the company in March 2020, brought down the order volumes significantly and also caused a slump in the dining-out revenue. The foodtech startup clarified that it is working on a number of products to address this loss like introducing contactless dining and delivery/takeaway products in certain geographies outside of India.
Zomato's primary revenue source is through ad sales, online ordering, and Zomato Gold business segments — whose subscriptions continued to grow in FY20. The startup highlighted that it acquired Uber Eats during the year, to become the market leader in the delivery business. The all-stock transaction provided Uber with a 9.99 percent stake in Zomato.
In fact, it is expected to launch its IPO in the first half of 2021.
Zomato also said its unit economics in online ordering improved significantly with increased revenue, lower logistics cost, and user discounts. The filings read that the startup's huge focus on efficiencies and bringing down costs helped bring down the overall burn-rate significantly in FY20.
In the RoC filings, the foodtech unicorn said, "Business is shaping up well, and the management team is focussed to improve the product continuously, striving to focus on customer satisfaction, and ensuring to grow without compromising on profitability."
Edited by Suman Singh