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    Zomato revenue doubles to $394 million in FY20

    Synopsis

    In the first quarter of the ongoing fiscal year, the company's Ebitda loss stood at $12 million on revenue of $41 million and unit economics of its food delivery business improved.

    Zomato said it used to lose Rs 47 per order in the first quarter of the previous fiscal year, but that it gained Rs 27 per order in the first quarter of the current financial year, Goyal said.
    BENGALURU: Online food-ordering platform Zomato on Friday said revenue for the fiscal ended March 31 more than doubled to $394 million, even as losses widened to $293 million from $277 million in the previous fiscal.

    The restaurant discovery platform is on track to recover 60% of its monthly revenue in July compared to the pre-Covid-19 peak in February, it said, even as cash burn rate has fallen after its food-delivery volumes dropped significantly in April-May amid a lockdown when consumers refrained from ordering in.

    "In July, we estimate our monthly burn rate to land under $1 million, while our revenue should land at around 60% of pre-Covid-19 peaks (revenue was $23 million per month earlier). We expect to make complete recovery over the next 3-6 months while continuing to maintain tight control on costs/profitability..." Zomato's CEO Deepinder Goyal said in a blog post.

    Goyal said Zomato had rolled back salary cuts announced in May when the company had laid off 13% of its workforce.

    As many as 75% of employees had volunteered for partial salary cuts, reducing 14% in payroll costs. However, as of July 1, all original salaries have been reinstated, he said.

    In the first quarter of the ongoing fiscal year, the company's Ebitda loss stood at $12 million on revenue of $41 million and unit economics of its food delivery business improved, it said.

    zomato-graph

    Zomato said it used to lose Rs 47 per order in the first quarter of the previous fiscal year, but that it gained Rs 27 per order in the first quarter of the current financial year, Goyal said.

    "We do not believe that the current contribution margin in our business is sustainable in the long term. Over time, we expect contribution margin per order to normalise between Rs 15-20 per order," he added.

    Zomato's drastic reduction in expenses and focus on profitability comes at a time when its ongoing financing round with existing investor, Alibaba's affiliate Ant Financial, which owns 25% of the company, has yet to close.

    Last month, Zomato's leading investor Info Edge said that $100 million in funding from Ant Financial, which was supposed to come in as part of its larger capital raising round, had been delayed due to the new foreign direct investment (FDI) rules announced by the government as it put curbs on Chinese capital.

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    1 Comment on this Story

    Praker 34 days ago
    Story might be different from April onwards..
    The Economic Times