Food delivery aggregator Zomato Ltd. reported a net profit for the third straight quarter. Zomato reported a consolidated net profit of Rs138 crore for the October to December period. Revenue for the quarter grew to Rs 3,288 crore.
During the same quarter last year, Zomato had posted a net loss of Rs 347 crore and revenue of Rs 1,948 crore.
While delivery costs have risen 63 percent to Rs 1,068 crore in Q3 from Rs 655 crore in the year-ago period, the company has been able to rein in the growth of advertising and promotional expenses in this period, as per reports.
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Marketing expenses only grew 7 percent year-on-year to Rs 374 crore, even as revenue jumped.
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In a letter to shareholders, Zomato’s management said that the company’s improving margins have been driven by factors like greater ad monetisation and introduction of platform fees.
“We think it is too early to predict how the platform fee will shape up. Much like the Gold program, we are still testing the waters on what works and makes sense here from a long term perspective,” said Rakesh Ranjan, the company’s food delivery CEO.
“We will continue to tactically use levers like these to optimise both growth and margin expansion. Most importantly, as we do this, we will also continue to ensure the viability and well-being of each of our stakeholders – our customers, restaurant partners and delivery partners,” he added.
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