Zomato FY Q2 2024: Second Straight Profitable Quarter with 72% YoY Revenue Surge

Zomato's financial performance in fiscal Q2 2024 has truly been exceptional, with both revenue and net profit reaching unprecedented heights. The net profit soared to a delicious ₹36 crore, leaving behind the paltry ₹2 crore reported in the previous quarter.

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Zomato Ltd. (NSE: ZOMATO), India’s online food delivery major, unveiled its financial results for the second quarter of fiscal 2024 ending September 30, 2023. Interestingly, the company witnessed substantial growth in both revenue and net profit during this period. Zomato’s revenue increased a whopping 71.46% YoY and 17.88% QoQ in Q2 FY24, to an all-time high of ₹2,848 crore. The cherry on top of this financial feast is that the September quarter marked Zomato’s second consecutive quarter of profitability.

Zomato’s net profit in FY Q2 2024 soared to a delicious ₹36 crore, leaving behind the paltry ₹2 crore reported in the previous quarter. During the same quarter last fiscal year, the food delivery company reported a ₹251 crore net loss.

Let’s dig into the Zomato success story and uncover how they managed to whip up remarkable growth in both revenue and net profit while keeping a tight rein on their expenses. We’ll also explore the star segments that contributed most to the company’s revenue during the second quarter, which wrapped up on September 30, 2023.

Zomato Expenses FY Q2 2024

  • Employee Benefit Expenses: Zomato’s commitment to its employees’ well-being and development is evident, as employee benefit expenses increased 9.45% YoY and 23.37% QoQ, reaching ₹417 crore during fiscal Q2 2024.
  • Advertising and Sales Promotion: The food delivery giant continued to invest in its brand’s visibility and customer reach by spending a significant ₹355 crore on advertising and sales promotion activities during the September quarter. These expenses increased 18.33% YoY and 13.06% QoQ increase during the quarter.
  • Delivery and Related Charges: In an effort to enhance and expand its food delivery services, Zomato allocated a substantial budget of ₹919 crore in FY Q2 2024, with an increase of 55.76% YoY and 13.46% QoQ.

Zomato spent ₹0.99 to earn ₹1 in the second quarter of fiscal 2024.

Zomato’s Gross Order Value (GOV) by Segment

Zomato’s total Gross Order Value (GOV) across its B2C businesses surged an impressive 46.98% YoY to an all-time high of ₹11,422 crore in FY Q2 2024. Sequentially, the GOV grew 13.38% during the second quarter.

Zomato’s GOV in the food delivery segment showed impressive growth, with a 9.05% increase on a quarterly basis (QoQ) and a remarkable 20.34% on a yearly basis (YoY). The primary driver behind this growth was a surge in order volumes. Food delivery remained a significant contributor, accounting for 69.87% of Zomato’s total GOV during the fiscal second quarter, reaching ₹7,980 crore. The growth in food delivery GOV was primarily driven by a substantial increase in order volumes, while the average order value remained largely consistent.

One of the key drivers of Zoamto GOV growth during the second quarter of fiscal 2024 was the company’s Gold program, which promotes higher ordering frequency among members. Zomato has successfully attracted 1.8 million gold members in the last three months ended on September 30, 2023, taking the total count to 3.8 million members. These members contributed to approximately 40% of GOV in the food delivery business.

The revenue generated from the food delivery business reached ₹1,925 crore in Q2 FY 2024, with a substantial 21.76% YoY increase. On a quarterly basis, Zomato’s online food delivery business recorded impressive growth at 10.51% during the September quarter. This performance reflects the company’s strong position and growing demand in the food delivery sector.

Quick Commerce (Blinkit) business witnessed a strong resurgence, achieving an impressive 29% QoQ growth in Gross Order Value (GOV), totalling ₹2,760 crore in Q2 FY24. This remarkable recovery came after a period of slow growth in Q1 FY24. Quick commerce accounted for 24.16% of the company’s total GOV during the September quarter.

In the past five quarters since the acquisition of Blinkit, there has been a consistent rise in Blinkit’s GOV as a percentage of Zomato’s GOV in overlapping cities. In some of these cities, Blinkit’s GOV has already surpassed Zomato’s GOV. If this rapid growth continues, with Blinkit’s GOV growing at a rate exceeding 80% YoY, it’s highly likely that Blinkit’s GOV will become significantly larger than Zomato’s GOV in overlapping cities, effectively compensating for Zomato’s wider geographical footprint.

Zomato’s revenue from Quick commerce business increased an astonishing 114% YoY and 31.51% QoQ in FY Q2 2024, amounting to ₹505 crore. This segment accounted for 17.73% of the company’s total revenue during the second quarter.

Going out (dining-out + Zomato Live business) segment experienced a remarkable 128.86% YoY and 10.71% QoQ surge in Gross Order Value, to ₹682 crore in FY Q2 2024.

Additional Key Metrics:

  • Zomato’s average monthly transacting customers reached 18.4 million in fiscal Q2 2024, with a 5.14% YoY growth from 17.5 million in the previous year.
  • The average monthly active delivery partners surged by 20.23% YoY to reach 410 thousand in fiscal Q2 2024, compared to 341 thousand a year ago period.
  • Zomato’s average monthly active food delivery restaurant partners increased by 15% YoY to 238 thousand in fiscal Q2 2024.

Zomato’s ability to achieve robust growth, optimize expenses, and cater to diverse customer preferences in various segments underscores its position as a leading player in India’s online food delivery landscape. The company’s consistent success in generating profits for two consecutive quarters is a testament to its resilient business model and effective strategies.



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