The operator of Zomato and Blinkit reported revenue from operations of Rs 7,167 crore, up 70% from Rs 4,206 crore a year ago.
The earnings were announced during market hours, and shares of Eternal surged over 7% following the announcement, hitting the day’s high of Rs 274 on NSE.
The sharp decline in profit was on account of the continuing investments in quick commerce segment and going-out.
“On the profitability front, consolidated Adjusted EBITDA declined 42% YoY to Rs 172 crore in Q1FY26, largely on account of the continuing investments in quick commerce and going-out, which were partly offset by the improvement in food delivery Adjusted EBITDA margin (as a % of NOV) to 5.0% from 3.9% a year ago,” said Akshant Goyal, CFO, Zomato.
The company also reported a 15% YoY jump in its Q1FY26 expenses to Rs 2,137 crore, primarily under heads such as ‘Delivery and related charges’ and ‘Advertisement and sales promotion’.Expenses stood at Rs 1,936 crore in Q4FY25 and Rs 1,854 crore in Q1FY25.The net order value (NOV) of Eternal’s B2C businesses grew 55% YoY and 16% quarter-on-quarter to Rs 20,183 crore in Q1FY26.
“This was the first quarter where our quick commerce NOV exceeded food delivery NOV for the full quarter. On an annualized basis, we are now at nearly $10 billion in NOV across our B2C businesses, with quick commerce becoming our largest segment—contributing almost half of the annualized NOV,” the company said in its letter to shareholders.
The consolidated adjusted revenue grew 67% YoY and 22% QoQ to Rs 7,563 crore, and its growth rates here have been steady at 50%+ for the past 11 quarters, the filing claimed.
The B2B business Hyperpure’s revenue grew 89% YoY (25% QoQ) and the company expects de-growth in this business in the next few quarters.
Food Delivery Business in Q1 and Outlook
Net Order Value (NOV) growth in Zomato’s food delivery segment dipped slightly to 13% YoY in Q1FY26, compared to 14% in the previous quarter. The gap between Gross Order Value (GOV) and NOV growth widened during the quarter.
CEO Deepinder Goyal said he expects YoY growth to bottom out as the company recovers from the demand slowdown that began in late 2024.
“For FY26, it looks unlikely that the business will deliver 20%+ NOV growth, but we should be north of 15% and hopefully trending towards 20% YoY growth in FY27,” Goyal said.
To tackle the sluggish demand environment, Zomato saw an increase in restaurant-funded discounts (as a percentage of GOV) in Q1FY26, which led to the lower NOV growth relative to GOV.
“We expect such quarterly fluctuations to be a regular feature as restaurants calibrate their investment in discounts based on changes in demand,” Goyal noted.
Margins in the food delivery business expanded YoY but declined sequentially—breaking a 14-quarter streak of continuous improvement.
“Margins in both food delivery and quick commerce tend to come under pressure in Q1 every year due to lower availability of delivery partners during festivals and adverse weather conditions,” he explained.
“In the past, these Q1 margin pressures were offset by improvements in other areas. But now that food delivery margins have matured, fluctuations driven by seasonal factors are possible. Long term, we still see scope for some margin expansion, but our current focus is on ramping up investments to drive further growth while maintaining margins in the 5% (of NOV) range.”
Blinkit
Blinkit added 243 net new stores in Q1FY26, bringing its total store count to 1,544.
The business reported a 127% YoY growth in NOV, driven by a 123% YoY increase in average monthly transacting customers (MTC), from 7.6 million to 16.9 million.
Profitability also improved: margins narrowed from -2.4% of NOV in Q4FY25 to -1.8%, despite ongoing investments in new store rollouts and seasonal cost pressures.
“We are on track to reach 2,000 stores by December 2025,” said Blinkit CEO Albinder Dhindsa. “We also added 0.4 million sq. ft. of warehousing space this quarter and now operate over 5.6 million sq. ft. across the country. Including store space, we manage ~10.4 million sq. ft. across our supply chain.”
Dhindsa also downplayed concerns about profitability.
“Despite long-term infrastructure investments and intense competition, a large portion of our business is already profitable—with some cities achieving 2.5%+ Adjusted EBITDA margins (as a percentage of NOV). Reaching this stage so early is a strong signal of our ability to meet our long-term target of 5–6% margins,” he added.
On competition
“New ideas, new entrants and disruption are all inevitable. I think it also makes our business stronger as long as we are able to learn, adapt and out-innovate potential competition. At this point, we do not see any innovation in the space which makes us believe that this business is under any obvious threat,” Goyal added.
