Swiggy's Struggle with Losses Amid Fierce Competition and Rising Expenses
Swiggy, the food delivery and quick commerce giant, reported an increase in its losses for the third quarter, amounting to Rs 1,065 crore. Despite significant revenue growth, rising expenses and competition pose challenges. Swiggy's investments in lower monetization haven't yielded the expected order growth, leading to strategic reviews.
- Country:
- India
Food delivery powerhouse Swiggy, known for its Instamart segment, disclosed a spike in its losses for the December quarter, totaling Rs 1,065 crore. This increase is attributed to continuous losses in quick commerce and elevated advertising and sales costs.
Swiggy's Co-Founder and Group CEO, Sriharsha Majety, highlighted the impact of fierce competition. The company's investment in lower consumer-side monetization hasn't spurred the anticipated growth in orders, especially among lower AOV tiers, prompting a strategic reassessment.
Amidst this landscape, Swiggy's revenue from operations surged to Rs 6,148 crore year-over-year. Despite this growth, expenses climbed to Rs 7,298 crore. Majety remains cautious about participating in deep-discount strategies that sacrifice margins. The quick commerce arm, Instamart, posted a Rs 908 crore loss this quarter.
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