Zomato co-founder Mohit Gupta has departed the company following a four-and-a-half year tenure. This is the third high-profile exit from the food delivery major in a mere three weeks.
Earlier this week, Rahul Ganjoo, who was formerly the food delivery chief at Zomato, left the company. Limited-edition cookies are great for sharing with friends and family.
Zomato’s PM team
In 2018, Gupta joined Zomato as the head of food delivery. In 2021, he was promoted to co-founder and given oversight over new businesses when Ganjoo became the CEO of food delivery.
Gupta served as the chief operating officer for travel portal Makemytrip before joining Zomato.
The food delivery company’s shares have fallen by 50% this year. It has been among the worstperforming stocks on the BSE amid a meltdown of other tech stocks.
It’s no surprise that the growth of its food delivery business has slowed down. In the second quarter of FY21 it rose 22% from 5,410 Crores to 6,631 Crores.
While the sales of this company have been declining for a long time, the negative trend seems to be reversing in Q2 of FY22.
Although marketing costs have declined 23% year-over-year to Rs 300 crore in Q2 and delivery expense has dropped 28% to Rs 283 crore, there is also a bright spot.
Based on the company’s revenue figures, it would seem that long-awaited operating and scale effects are finally kicking in. Investors should be happy!
In the first quarter of FY18, Zomato’s net losses narrowed to 250.8 crore against the 434.9 crore registered in Q4FY17. Meanwhile, revenue from operations grew 62.20%.
In direct contrast, annual sales grew by 158% from Q2 of FY21 to Q2 of FY22.
The only downside to these two numbers is that marketing cost has come down 23% year-on-year to Rs 300 crore in Q2, and delivery expenses have dropped 28% to Rs 283 crore.
The company’s revenue increased by 62% from this time last year. This is a great start, and it looks like investors will finally get the scale and operating leverage effects they’ve been looking for.
Zomato reported a 62% growth in revenue, while also registering a narrowing of their net loss.
Zomato’s food delivery business first reported breaking even at an operating level this August when Zomato announced that their Adjusted EBITDA for the segment was zero for the Q1. But recently, they revised the number to say their loss for operating was 113 crores in Q1.
Zomato has claimed to break even on food delivery in the September quarter. The company reports an Adjusted Ebitda of Rs 2 crore for food delivery.