Mon Jan 20 13:30:00 UTC 2025: ## Zomato’s Q3 Profits Dip Despite Revenue Surge, Driven by Blinkit Expansion

**Mumbai, January 21** – Zomato, India’s leading food delivery platform, reported a significant drop in net profit for the October-December quarter (Q3FY25), down 57.3% year-on-year to ₹59 crore. This decline, despite a 64.4% rise in revenue to ₹5,405 crore, is attributed to increased investment in its quick commerce arm, Blinkit.

While the food delivery business saw a nearly 22% revenue increase, Blinkit’s rapid expansion fueled the profit drop. Blinkit, though more than doubling its revenue, reported a net loss of ₹103 crore for the quarter. The company’s aggressive expansion strategy, adding over two stores daily, aims to reach 2,000 stores by December 2025, a year ahead of schedule. Zomato expects Blinkit to remain loss-making for the next one to two quarters due to this rapid growth.

Despite the profit dip, Zomato’s EBITDA (earnings before interest, taxes, depreciation, and amortization) rose to ₹162 crore, up from ₹51 crore in the same period last year. The company’s EBIT margin improved to 3%, compared to 1.6% last year. Zomato’s overall expenses surged to ₹5,533 crore, reflecting the investment in Blinkit and its growing workforce. The company anticipates rising employee costs due to the competitive job market.

Zomato’s investment in its “going-out” business (dining, ticketing, and live events) is also expected to contribute losses for approximately a year. Despite competition from Swiggy Instamart, Zepto, Flipkart, and BigBasket, Zomato maintains a 46% market share in the quick commerce sector and is considered by some analysts to be the most resilient player in the hyperlocal delivery space.

Following the results, Zomato shares closed 3.14% lower at ₹240.95 on the BSE. While analysts at JM Financials maintain a positive outlook on Zomato, citing its strong execution and free cash flow generation, other analysts have expressed concerns, leading to recent stock price corrections. Investors are advised to consult financial experts before making any investment decisions.

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