Indian food-delivery company Zomato weathered a decrease in revenue after COVID-19 hit — but at the same time saw an increase in profitability, founder and CEO Deepinder Goyal said in a blog post yesterday.
The privately held company saw revenue for the fiscal year that ended March 31, 2020, increase to $394 million, up from $192 million in fiscal 2019, the company reported. At the same time, the company reported, the annual net loss grew to $293 million from $277 million.
That annual revenue grew by 105 percent while the annual loss grew by only 6 percent indicates that the company is moving faster-than-expected toward profitability, Goyal wrote.
For the new fiscal year’s first quarter, which ended June 30, the Zomato reported revenue of $41 million and a net loss of $12 million — a significantly lower loss per dollar in revenue than during the two full fiscal years.
The company usually releases annual data in April but held off this year due to COVID-19’s sudden impact, Goyal said.
Goyal also said Zomato saw a significant increase in fiscal 2020 in its Gross Merchandise Volume — a measure of business activity used in some online industries to assess how much of a product a company is delivering even if it never takes ownership of that product.
“In the last few quarters…we fast-tracked our efforts towards making our business profitable and drove efficiency into our spends,” Goyal said. “While COVID-19 has impacted the size of our business, it has accelerated our journey to profitability. In terms of the size of the business, COVID-19 has set us back by a year or so — but a year is only a small blip when you are building a company for the next 100 years.”
Today’s earnings news follows a difficult few months — in addition to the economy-wide challenges wrought by COVID-19 — for Zomato. The company announced in early July that an expected $100 million investment from China’s Ant Financial was put on hold because India had adopted new legal barriers to foreign investment. Ant Financial previously invested $150 million in Zomato.
Additionally, at last one news outlet reported in May that Indian authorities tasked with preventing anti-competitive behavior were investigating Zomato’s purchase, recently completed at the time, of Uber Eats India for $206 million.