Zomato boosts adex by 26% to Rs 396 crore, achieves Rs 253 crore net profit in Q1 FY25

New Delhi: Food delivery aggregator Zomato on Thursday reported a 26% spike in its advertising expenses, spending Rs 396 crore for the Apr-June quarter of 2024-25, compared to Rs 314 crore in the same quarter, the previous fiscal. 

However, the company's advertising expenditure saw a modest increase of 1.7% QoQ. In Q4 FY2024, the company spent Rs 389 crore on advertising. 

Over the last fiscal year, the total advertising expenditure was Rs 1,432 crore.

The company reported a multifold jump in consolidated net profit to Rs 253 crore compared to Rs 2 crore in the year-ago period.

The company's revenue from operations jumped more than 74% to Rs 4,206 crore in the first quarter of this fiscal from Rs 2,416 crore in the April-June period of last year, according to a regulatory filing by Zomato.

Its total expenses also rose to Rs 4,203 crore during the quarter under review, from Rs 2,612 crore a year ago.

The reporting segments for the group include the food ordering and delivery business, Hyperpure Supplies (B2B), its quick commerce offering Blinkit, the going out segment and all other residual segments.

In a letter to shareholders, Zomato Chief Financial Officer Akshant Goyal shared that the gross order value (GOV) growth across its B2C businesses (food delivery, quick commerce and Going-out) accelerated to 53% YoY (14% QoQ) to Rs 15,455 crore.

"On the profitability front, consolidated Adjusted EBITDA increased by Rs 287 crore YoY to Rs 299 crore in Q1 FY25, driven by margin expansion in all the four businesses. Business turned Adjusted EBITDA positive exactly one year ago (in Q1FY24), and within a year we are now at an annualised profit of about Rs 1,200 crore," Goyal shared.

Blinkit co-founder and CEO Albinder Dhindsa said the quick commerce firm sees a line of sight of getting to about 2,000 stores for its current business.

"Most of these stores would be in the top 10 cities in India," he said, adding that beyond the large cities, the size of the market is still undiscovered.