Swiggy posts 30% rise in revenue as Instamart grows more than 2X in Q2

Food delivery and quick commerce player Swiggy on Tuesday posted a 30% year-on-year (YoY) increase in its operating revenue in Q2 FY25, driven by quick commerce growth and profitability in the core food delivery business.

The foodtech company’s operating revenue increased to Rs 3,601.4 crore during the July-September 2024 quarter, up from Rs 2,763.3 crore earned in the corresponding quarter in the previous year, according to an exchange filing. 

During the same period, Swiggy slightly narrowed its losses to Rs 625.5 crore from Rs 657 crore in the previous year as it expanded on its quick commerce operations leading to improved contribution margins.

“At the platform level, we’ve seen one of our best quarters so far with strong growth in GOV, while consistently reducing the losses,” noted MD and Group CEO Sriharsha Majety in a press note.

Its total expenses also increased by 23% YoY to Rs 4,309.5 crore from Rs 3,506.6 crore, mainly driven by a rise in employee benefit expenses, delivery-related charges, and other expenses.

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Swiggy Instamart, the company’s quick commerce segment, which competes with Blinkit and Zepto, more than doubled its operating revenue to Rs 490 crore from Rs 208 crore in the corresponding quarter last year. However, its losses remained largely stagnant, incurring Rs 317 crore in Q2 FY25. 

Instamart clocked a gross order value (GOV) of Rs 3,382 crore, 75% higher than the corresponding quarter in the previous year. Categories like beauty and personal care, personal electronics and fashion drove the average order value during the quarter to Rs 499 per order. 

Doubling down on its quick commerce efforts, Instamart plans to double its dark store count by the end of the financial year from 523 stores in March 2024. It has already increased the number of dark stores to 609 during Q2.

To cater to the demand for categories beyond daily essentials, Swiggy plans to increase the average size of its dark stores by 30-35%, aiming to grow its active dark store area 2.5X over the last year.

Swiggy’s largest segment, food delivery, clocked a profitable quarter with a net profit of Rs 121 crore against a loss of Rs 43 crore last year. Its revenue increased by 22% to Rs 1,574 crore, fuelled by its focus on newer offerings like Bolt, Eatlists, PocketHero, and others. 

The company’s going-out operations, Dineout, which competes with Zomato Gold and District, clocked a 46% rise in its GOV as it managed to improve its profitability with an improved adjusted EBITDA margin and higher contribution margin. 

Swiggy also announced the incorporation of a new subsidiary with a share capital of Rs 1 lakh. The subsidiary, whose name hasn't been disclosed yet, will engage in sports team ownership, talent development, event organisation, acquisition of broadcasting and sponsorship rights, and promotion of sports events.

Swiggy, which listed on public bourses on November 6, closed the day 0.55% lower at 3:30 pm, ending up at Rs 491 apiece on NSE. However, its stock was trading at Rs 514.68 before the results were announced.

Meanwhile, in the July-September 2024 quarter, Zomato clocked a profit of Rs 176 crore with an operating revenue of Rs 4,799 crore, according to the company’s second-quarter results filed in October this year.

(The copy was updated with more details.)