Food delivery company Zomato reported a sharp decline of 57% in its consolidated net profit for the December quarter of FY25, which stood at Rs 59 crore, compared to Rs 138 crore in the same period last year. Despite the drastic fall in profits, the company reported robust growth in operating revenues, which rose 64% year-on-year to ₹ 5,405 crore from ₹ 3,288 crore in Q3FY24.
Zomato Q3 Results: Key Financial Highlights
- Net profit: Decrease of 57% YoY to ₹59 crore in Q3FY25.
- Revenue from operations: Up 64% YoY to ₹5,405 crore.
- Sequential performance: Profit after tax (PAT) decreased by 66% YoY to ₹176 crore in Q2FY25, while revenue increased sequentially by 13% YoY to ₹4,799 crore.
- Gross Order Value (GOV): In the B2C business, gross order value increased 57% YoY and 14% sequentially to ₹20,206 crore in Q3FY25.
Market Reaction
The announcement of Zomato’s Q3 earnings during market hours led to a sharp sell-off in its stock. Zomato shares plunged over 7% to close at ₹230.70 on the NSE. The stock hit an intraday low of ₹241.75, reflecting a 3% decline. On the BSE, Zomato shares ended 3.14% lower at ₹240.95, down by ₹7.80. Here take a look:
Zomato Q3 Results: Net Profit Drops 57% YoY to ₹59 Crore, Shares Take a Hit#sharemarket#zomatoresults pic.twitter.com/38MLNUwkrw
— Moneyscope (@Moneyscopedotin) January 20, 2025
In contrast, the broader market remained upbeat, with the BSE Sensex closing 454.11 points higher at 77,073.44, up 0.59%.
Read More:
- Small Savings Schemes Interest Rates: Government Announces New Rates for FY 2023-24
- ITC Hotels Share Listing Date: Everything You Need to Know
Zomato’s Guidance and Challenges
In its letter to shareholders, Zomato acknowledged a broad-based slowdown in demand that began in the second half of November. The company noted:
“Our 20%+ YoY GOV growth guidance for the food delivery business is more long-term. There will be periods of higher and lower growth along the way. Currently, we are going through a broad-based slowdown in demand which started during the second half of November. Notwithstanding the current slowdown, we are positive about a recovery.”
Despite the short-term challenges, Zomato remains optimistic about achieving long-term growth in its food delivery business.
Outlook
Zomato’s performance in Q3FY25 shows a mix of challenges and opportunities. While the sharp decline in profits and slower demand growth is a cause for concern, the strong year-on-year sales and revenue growth show the company’s ability to scale its business. Investors will keep a close eye on Zomato’s strategy to address the current demand weakness and its impact on future quarters.
