Swiggy's Revenue Surges 54% to Rs 5,561 Crore, But Net Loss Widens to Rs 1,092 Crore

Swiggy's financial results for the July-September quarter reveal a familiar trend of robust growth overshadowed by increasing losses. The food and grocery delivery giant posted a net loss of Rs 1,092 crore, marking a 74.4% increase compared to the Rs 626 crore loss in the same period last year. However, this represents a sequential improvement, with losses narrowing by nearly 9% from the previous quarter's Rs 1,197 crore. Revenue performance was strong, climbing 54% year-on-year to Rs 5,561 crore, exceeding estimates of Rs 5,285 crore, driven by sustained demand in both food delivery and quick commerce. Total expenses rose by 56% year-on-year to Rs 6,711 crore. The Adjusted Ebitda loss stood at Rs 695 crore, a slight improvement from the previous quarter but significantly wider than the Rs 341 crore loss a year ago.

Swiggy's core food delivery business saw steady growth, with revenue up 22% to Rs 2,206 crore and Gross Order Value (GoV) increasing by 19% to Rs 8,542 crore. The segment achieved adjusted Ebitda of Rs 240 crore, and its monthly transacting users grew 17% to over 17.2 million.

Instamart, Swiggy's quick commerce segment, was the primary growth driver, with revenue doubling to Rs 1,038 crore and GoV surging 108% to Rs 7,022 crore. Monthly users for Instamart climbed 34% to 22.9 million. Despite this rapid expansion, Instamart remains the biggest drag on profitability. Swiggy plans to optimize its existing infrastructure to handle increased order volumes rather than aggressively expanding its network of darkstores, contrasting with competitor Blinkit's expansion pace.

Beyond delivery, Swiggy's out-of-home consumption verticals, Dineout and SteppinOut, reported Rs 1,118 crore in GoV, up 52%, and achieved positive adjusted Ebitda of Rs 6 crore.

As of September-end, Swiggy held Rs 4,605 crore in cash, with an additional Rs 2,400 crore expected from the sale of its stake in Rapido. The company is preparing to raise up to Rs 10,000 crore through a Qualified Institutional Placement (QIP), with a board meeting scheduled for November 7. This fundraising, if successful, would more than double its cash reserves to approximately Rs 17,000 crore.

Impact: This news highlights Swiggy's strong revenue and user growth trajectory, particularly in the quick commerce space. However, the significant widening of net losses, driven by aggressive expansion, raises concerns about its path to profitability. The planned large fundraising signals a substantial capital requirement to fuel continued growth and operational expansion. Investors will closely monitor the company's ability to manage costs effectively while scaling its operations, especially in light of intense competition. The success of this fundraising and future profitability will be key determinants of investor sentiment towards the company and the broader food tech sector. Rating: 7/10.

Difficult Terms: Net Loss: The amount of money a company spends that is greater than the money it earns. Revenue: The total income generated from the sale of goods or services. Year-on-year (YoY): A comparison of financial data from one period to the same period in the previous year. Quarter-on-quarter (QoQ): A comparison of financial data from one quarter to the previous quarter. Instamart: Swiggy's quick commerce service that focuses on delivering groceries and daily essentials rapidly. Ebitda: Earnings Before Interest, Taxes, Depreciation, and Amortization, a measure of a company's operating performance. Adjusted Ebitda: Ebitda that has been modified to exclude certain expenses or revenues to provide a clearer picture of core operating performance. Gross Order Value (GoV): The total monetary value of all orders placed through Swiggy's platform before any deductions or fees. Darkstores: Small, specialized warehouses located in urban areas designed for the rapid fulfillment of online orders. Qualified Institutional Placement (QIP): A method for listed companies to raise capital by selling equity shares to qualified institutional buyers such as mutual funds, pension funds, and insurance companies.