Zomato: Blinkit’s losses expand as quick commerce firm accelerates expansion

Zomato-owned quick commerce firm Blinkit has reported an Ebitda loss of Rs 103 crore for the October-December period, significantly higher from a Rs 8-crore operating loss in Q2 — moving away from its guidance of staying breakeven in the near term.

Blinkit’s increased losses, which came on account of the company’s expansion push, also impacted its parent company’s overall profitability.

The quick commerce platform, which had aimed to operate 1,000 dark stores by March this year, has already achieved the target ahead of its timeline. As of December 31, it had 1,007 dark stores.

The company also said it will have 2,000 dark stores, or micro warehouses from where 10-minute deliveries are made, by December 2025 — accelerating its earlier target of December 2026.

“The losses in our quick commerce business this quarter are largely on account of pulling forward the growth investments in the business that we would have otherwise made in a staggered manner over the next few quarters. As of now, it seems like we will get to our target of 2,000 stores by December 2025, much earlier than our previous guidance of December 2026,” Zomato founder and CEO Deepinder Goyal said.

Zomato reported a 57% year-on-year fall in its net profit for the December quarter at Rs 59 crore. Its operating revenue, meanwhile, grew 64% on-year to Rs 5,405 crore.

The rapid expansion comes on the back of increased competitive intensity in the quick commerce sector with rivals including Lightspeed-backed Zepto and Swiggy Instamart also making massive investments to grow their footprint.Blinkit CEO Albinder Dhindsa said in Zomato’s shareholders letter, “…, heightened competition has led to a pause in margin expansion in the business, which is expected and should be temporary. So far, we have not seen any attrition of our core customers which tells us that customers are continuing to choose Blinkit over other options”.