Eternal Q1 Results: Zomato Parent's Net Profit Falls 36% To Rs 25 Crore, Misses Estimates

Eternal Q1 Results: Eternal Ltd., the parent company of leading food delivery platform Zomato, posted a 36% sequential drop in consolidated net profit in the June quarter of fiscal 2025-26 (Q1FY26). The share price of the Deepinder Goyal-led company soared 4% with the announcement of Q1 results.

The bottomline came in at Rs 25 crore, compared to Rs 39 crore in the March quarter, according to a stock exchange filing on Monday. Analysts' consensus estimates compiled by Bloomberg projected Rs 106.8 crore.

Eternal Q1FY26 Highlights (Consolidated, QoQ)

• Revenue up 23% to Rs 7,167 crore versus Rs 5,833 crore (Estimate: Rs 6,624 crore)

• EBITDA up 60% to Rs 115 crore versus Rs 72 crore (Estimate: Rs 179 crore)

• Margin at 1.6% versus 1.2% (Estimate: 19.2%)

• Net profit down 36% to Rs 25 crore versus Rs 39 crore (Estimate: Rs 106.8 crore)

Eternal operates food delivery platform Zomato and quick commerce app, Blinkit. It also offers booking tickets for movies and live events, as well as table reservations at restaurants through its District app.

Eternal's food delivery segment's net profit rose 6% sequentially to Rs 465 crore, while the quick commerce segment reported a net loss of Rs 42 crore from Rs 82 crore in the previous quarter. The hyperpure business also reported a loss of Rs 5 crore in the quarter-under-review, narrower than Rs 8 crore in the March quarter.

In terms of revenue, the food delivery segment reported a rise of 10% sequentially to Rs 2,261 crore, quick commerce reported a growth of 40% to Rs 2,400 crore, hyperpure's revenue rose 25% to Rs 2,295 crore, while the going-out revenue dropped 10% to Rs 207 crore compared to the preceding March quarter of FY26.

Eternal also announced that it will launch a new service where food will be prepared, sold and delivered to customers in a bid to rival Zepto Cafe. The company will incorporate a wholly-owned subsidiary named Blinkit Foods Ltd. with a total paid-up capital of Rs 10 lakh.

"Blinkit Foods is proposed to be incorporated as a wholly owned subsidiary and would inter-alia engage in the business of providing food services (including innovation, preparation, sourcing, sale and delivery of food to customers)," said Eternal in its stock exchange filing.

The Zomato parent said in its letter to shareholders that in the first quarter where quick commerce net order value (NOV) exceeded the food delivery NOV. Going forward, Eternal will only disclose the NOV (which is gross order value or GOV minus the discounts)

"At this point, we don't see any innovation in the space which puts business under any obvious threat," said CEO Deepinder Goyal in his letter to shareholders. "In near terms, percentage margins have bottomed out," he added.

Eternal expects to see margins improve as several stores mature and also hopes that the absolute losses should come down in the coming quarters. Eternal lowered the food delivery guidance as the company will not be able to deliver over 20% net order value growth in FY26. The outlook is pegged around 15%.

The quick commerce company added 243 net new Blinkit stores during the June quarter, taking the total store count to 1,544 stores. Will be transitioning q-comm business from marketplace model to inventory ownership over next 2-3 quarters

On Blinkit, Eternal expects to start working with brands directly without any disruption to the business. "The control on inventory gives more leverage on margins in the business and allows us to push harder and faster on assortment expansion," said the management in the shareholder's letter.

Eternal expect to see about one percentage point margin expansion over time as a result of this transition. "As an outcome of this transition, we will also see shrinkage in Hyperpure’s non-restaurant business as most of the B2B buyers in that business were sellers on our quick commerce platform," said the management.

District has the potential to scale to $3 billion in annual topline and $150 million of adjusted EBITDA over the next five years. The Going out business has the potential to scale to $3 billion in NOV basis with $150 million adjusted EBITDA in the next five years.