BENGALURU: Online food delivery firm Zomato said that its core business has recovered to 60 per cent of pre-COVID levels, even though the Gross Merchandise Volume (GMV) hit its lowest point in two years (down by 80 per cent) due to the pandemic.
However, despite the lockdown in the last week of March, Zomato’s FY20 revenues have grown by 105 per cent to $394 million compared to $192 million in FY19. But EBITDA loss also grew, standing at $293 million in FY20 compared to $277 million a year ago.
In FY21, Zomato said that its focus will be on food delivery unit economics, moving away from the loss model. The company has now made a profit of `27 per order in Q1FY21, compared to the contribution margin loss of Rs 47 per order a year ago. Discounts (other variable costs) and delivery cost per order have also come down to Rs 15 and Rs 41 in Q1FY21 compared to a year ago, even as revenue per order has jumped to Rs 83.
For Q1FY21 (April-June, 2020 quarter) revenue was reported at $41 million whereas losses stood at $12 million. Zomato founder and CEO Deepinder Goyal said in a blogpost that although business suffered a setback by one year, it is nevertheless on the right track for achieving profitability and minimizing the cash burn.
“In July 2020, we estimate our monthly burn rate to land under $1 million, while our revenue should land at ~60 per cent of pre-Covid peaks ($23 million per month). We expect to make complete recovery over the next 3-6 months while continuing to maintain tight control on costs/profitability,” Goyal added.
In January, 2020, Zomato acquired Uber Eats for $206 million, which has helped it strengthen its market presence in a tightly contested online food delivery space.
In FY21, Zomato said that its focus will be on food delivery unit economics, moving away from the loss model. The company has now made a profit of `27 per order in Q1FY21, compared to the contribution margin loss of Rs 47 per order a year ago. Discounts (other variable costs) and delivery cost per order have also come down to Rs 15 and Rs 41 in Q1FY21 compared to a year ago, even as revenue per order has jumped to Rs 83.
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