Jan 29 (Reuters) - India’s Swiggy posted a smaller sequential loss and reiterated that it aims to hit a key profitability metric in the first quarter of next year, driven by strong growth in its Instamart quick‑commerce business.
India’s quick‑commerce sector - which delivers everything from milk to mobile phones within minutes - has drawn heavy investment as companies race to expand in the fast‑growing segment.
Swiggy posted a consolidated loss of 10.65 billion rupees ($115.8 million) for the quarter ended December 31, compared with 10.92 billion rupees in the previous quarter, though losses remained wider than the 7.99 billion rupees it reported a year earlier.
The company said it remains confident of achieving contribution-margin break-even - when revenue from each order covers its direct fulfilment costs - in the first quarter of fiscal 2027.
Contribution margin for its quick‑commerce business improved 9 basis points sequentially to negative 2.5%.
Swiggy’s Instamart, Eternal’s Blinkit and Zepto remain the sector’s leading players, vying for market share through steep discounts, subsidised deliveries and rapid warehouse expansion.
The race has pressured profitability at Eternal and widened losses at Swiggy, which said last year that absolute losses would begin to decline gradually.
Instamart’s adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) margins improved 65 basis points from the prior quarter to a negative 11.4%.
Quick‑commerce revenue surged 76% year‑on‑year, driven by a similar rise in net order value, helping lift overall revenue 54% to 61.48 billion rupees.
Swiggy's losses narrowed largely due to improved network density, with a higher store count in key markets reducing its cost per order.
The company opened 34 “dark stores” - compact warehouses in densely populated neighborhoods - in the third quarter, taking its total to 1,136. It had added 40 dark stores in the second quarter.
Reporting by Kashish Tandon in Bengaluru; Editing by Sonia Cheema
Source: Reuters