Swiggy, the Bengaluru-based food delivery giant, saw its net loss cross the INR 4,000 Crore threshold for the financial year ending on March 31, 2023. Supported by Invesco, this decacorn incurred a net loss of INR 4,179.3 Crores in the fiscal year 2022-23 (FY23), reflecting a 15% increase from INR 3,628.9 Crores in the previous financial year.
Swiggy experienced a significant surge in its operating revenue, with a growth of more than 40% to INR 8,264.4 Cr in the year under review, compared to INR 5,704.9 Cr in FY22. This increase can be attributed to the expansion of its quick commerce vertical during the same period.
Established in 2014 by Sriharsha Majety, Nandan Reddy, Phani Kishan Addepalli, and Rahul Jaimini, Swiggy originally began as a food delivery startup. Subsequently, amid the pandemic, it introduced its quick commerce vertical – Swiggy Instamart. Additionally, Swiggy provides services such as Swiggy Genie and Minis store.
Swiggy generates income through its online platform services offered to partner merchants, which include restaurant merchants, grocery merchants, and delivery partners. Additionally, the company earns revenue through advertisement services, the sale of food and traded goods, subscriptions, and other related platform services.
Swiggy’s Cost Breakdown:
In the fiscal year 2023, the startup achieved a revenue of INR 3,221.4 Crores by retailing FMCG products through Swiggy Instamart, marking a 39.7% growth compared to the INR 2,035.6 Crores earned in the preceding fiscal year.
It also generated INR 4,413.9 Crores from service sales, reflecting a 28% growth from the INR 3,444.4 Crores recorded in FY22. However, Swiggy did not disclose a detailed breakdown of this revenue.
The foodtech giant witnessed a surge of over 35% in expenditure, reaching INR 12,884.4 Crores in FY23, compared to INR 9,574.5 Crores in the preceding fiscal year.
The procurement cost for the startup experienced a 49% increase to INR 3,380.9 Crores in FY23 from INR 2,268.1 Crores in the previous fiscal year. This cost encompasses the expenses associated with acquiring FMCG products for Swiggy Instamart.
In FY23, the outsourcing support cost for the startup increased by 34% to INR 3,159.3 Crores, up from INR 2,350.2 Crores in the preceding fiscal year. This expenditure may encompass employees on third-party payrolls, including delivery executives and personnel operating in dark stores.
During the reviewed period, Swiggy allocated INR 2,361.7 Crores to advertising, marking a 28% increase from the INR 1,848.7 Crores spent in FY22. In simple terms, Swiggy generated INR 3.4 for every rupee invested in advertising.
The costs associated with employees rose by 25% to INR 2,129.8 Crores in FY23, up from INR 1,848.7 Crores in FY22.
In FY23, the startup incurred INR 139.5 Crores in losses due to order cancellations, representing an 11% decrease from the INR 156.4 Crores recorded in the previous fiscal year.
The release of financial statements follows recent reports indicating Swiggy’s plan to reduce its workforce by approximately 400 employees. This move is seen as part of the foodtech giant’s strategy to enhance its financial performance ahead of filing draft papers for its upcoming initial public offering (IPO) later this year. Swiggy aims to raise $1 billion (INR 8,300 Crores) through the IPO.
Continue Exploring: IPO-bound Swiggy initiates workforce reduction, plans to cut 6% of jobs to enhance profitability
Last year, the startup asserted that it had attained profitability in its food delivery operations by March 2023. CEO Majety stated that the foodtech giant stood among the limited number of global food delivery platforms to reach profitability, although the company did not disclose specific figures.
Just last week, Swiggy extended its food delivery services to the city of Agatti in Lakshadweep, the union territory that gained prominence following Prime Minister Narendra Modi’s visit earlier this month.
Continue Exploring: Swiggy breaks new ground: Becomes the first food delivery platform to launch services in Lakshadweep
In recent times, Swiggy has witnessed several notable departures, with key figures such as Karthik Gurumurthy (senior vice president and head of Swiggy Instamart), Dale Vaz (CTO), Anuj Rathi (SVP, central revenue and growth), Ashish Lingamneni (VP, marketing), and Dineout co-founder Vivek Kapoor among those who have exited the company.
With a valuation over $10 billion, the startup has raised more than $3 billion in funding and is supported by notable backers like SoftBank, Invesco, Prosus Ventures, DST Global, among others. It competes with Zomato, which has reported two consecutive profitable quarters in FY24.