Bengaluru: Swiggy narrowed its June-quarter loss by 34% to Rs 791 crore, helped by stronger food delivery earnings and lower losses at its quick-commerce business, Instamart, from Rs 1,197 crore a year earlier. Total income rose 39% to Rs 7,023 crore from Rs 5,048 crore. Sequentially, the loss was largely unchanged from Rs 800 crore in the March quarter.Instamart reached what companies call “contribution break-even” in May, meaning revenue covered discounts and other costs directly linked to fulfilling each order. However, it did not cover broader expenses such as technology, corporate staff and overheads.For the June quarter, Instamart narrowly missed this milestone, posting a contribution margin of negative 0.2%. After accounting for corporate overheads and other fixed costs, the business reported an adjusted operating loss of Rs 778 crore, an improvement of Rs 80 crore from the previous quarter.“In a period where quick-commerce competition has only intensified, we prioritised improving unit economics over fleeting headline growth,” CEO Sriharsha Majety said. “Our efforts over the last few quarters to reset our user base, economics and experience have together made the business much stronger and increased its staying power.”The improvement came partly from pruning loss-making business. Swiggy said it had “weaned away unprofitable users”—more than four million over the past three quarters—and reduced orders that hurt profitability.The customers were not blocked. Instead, the platform appears to have reduced discounts, free delivery and other incentives for users whose small or heavily discounted orders failed to cover their direct costs, prompting some to order less frequently or leave.While the strategy improved profitability per order, it also slowed growth. Instamart’s net order value rose 3% sequentially to Rs 5,817 crore, while gross order value increased nearly 40% year-on-year to Rs 7,907 crore.Rival Blinkit, owned by Eternal, remained ahead on profitability, reporting an adjusted operating profit of Rs 102 crore during the quarter.Looking ahead, Instamart plans to add about 75 dark stores in the September quarter, largely in cities where it already operates. It currently runs 1,171 dark stores across 131 cities. Overall network utilisation is around 40%, although some high-demand neighbourhood stores are already operating near capacity.Swiggy said Instamart would need to more than double quarterly orders from 11.5 crore to between 25 crore and 30 crore, while increasing contribution by around Rs 30 per order, to achieve adjusted operating break-even. It expects higher brand funding, advertising revenue and better warehouse utilisation to drive that improvement.
