Swiggy , the popular food delivery and quick commerce platform, has seen its shares take a significant hit, dropping 26.75% year-to-date following weak quarterly results and persistent losses. The company's financial performance has raised concerns among investors, despite showing strong revenue growth.

Q1FY26 Financial Performance

Swiggy reported a substantial increase in net loss for Q1FY26, reaching Rs 1,197.00 crore compared to Rs 611.00 crore in the same quarter of the previous year. However, the company's revenue saw a notable uptick, increasing by 54% to Rs 4,961.00 crore.

The widening losses can be attributed to a surge in total expenses, which rose by 60% to Rs 6,244.00 crore. This increase was primarily driven by:

• Higher delivery costs
• Increased advertising spends
• Rising employee benefits
• Escalating logistics costs in the quick commerce segment

Q4FY25 Results

The Q1FY26 results follow a similar trend observed in Q4FY25, where Swiggy reported:

Management's Perspective

CEO Sriharsha Majety addressed the mounting losses, attributing them to scale-driven expansion and continued investments aimed at achieving long-term sustainable profitability. The company appears to be prioritizing growth and market share over immediate profitability.

Technical Analysis

Despite the overall downtrend, technical analysts have noted some positive movements in Swiggy's stock:

• A rally of 20-26% from recent lows
• Current trading in a consolidation range of Rs 375.00-430.00

The stock is approaching a critical technical level:

• 200-day Exponential Moving Average (EMA) between Rs 420.00-425.00

Analysts suggest two potential scenarios:

1. Bullish scenario: A breakout above the 200-day EMA could lead to further gains, potentially reaching Rs 450.00-470.00.
2. Bearish scenario: Failure to break resistance coupled with a drop below Rs 370.00 may trigger renewed selling pressure.

Investor Outlook

The significant year-to-date decline in Swiggy's share price reflects investor concerns about the company's path to profitability. While the robust revenue growth is encouraging, the expanding losses and rising expenses have dampened investor sentiment.

As Swiggy continues to invest in expansion and long-term growth strategies, investors will be closely monitoring the company's ability to balance growth with profitability in the coming quarters. The stock's performance in the near term may depend on the company's ability to demonstrate progress towards sustainable profitability while maintaining its strong revenue growth trajectory.

Swiggy , a leading food delivery and quick commerce platform in India, reported strong performance in its quick commerce business, Instamart, for the first quarter. The company held its earnings conference call on July 31, revealing significant growth and improvements across key metrics.

Instamart's Stellar Performance

Instamart, Swiggy's quick commerce arm, demonstrated remarkable growth with a 108% year-on-year increase in Gross Order Value (GOV). This surge was primarily attributed to the expansion of dark stores in both existing and new areas. The business now operates in 127 cities with a total store area of 4.30 million square feet.

Impressive AOV Growth

One of the standout achievements for Instamart was the significant improvement in Average Order Value (AOV). The company reported a 16% quarter-on-quarter and 26% year-on-year increase in AOV, surpassing its own guidance. This growth was driven by focused efforts, including the Maxxsaver program, which has achieved a 28% Monthly Transacting User (MTU) penetration.

Contribution Margin Improvement

Despite headwinds from network expansion, Instamart's contribution margin improved by 100 basis points quarter-on-quarter. The company added 41 new stores during the quarter and expects to reach contribution margin neutrality between December and June.

Food Delivery Business Maintains Momentum

Swiggy's core food delivery business maintained competitive performance with an 18.80% GOV growth. The company's Bolt service, which focuses on faster deliveries, now contributes over 10% of food delivery orders.

Strategic Initiatives and Future Outlook

Amitesh Jha, CEO of Instamart, highlighted the success of the Maxxsaver program in driving AOV growth and improving customer retention. He stated, "We believe that this is the right way to approach both basket building for the end consumer, making sure that they get great offers as well as making sure that they come back to our platform again and again."

The company remains committed to investing in growth amid continued competitive intensity in the quick commerce market. Sriharsha Majety, Managing Director and Group CEO, emphasized the company's focus on innovation, particularly in the 10-minute delivery space, stating, "We are taking a measured approach, having a certain narrow presence to understand with the critical mass of consumers, how to bring more consumer love into the offering, and how the economics work."

Swiggy's management expressed confidence in their strategy and growth trajectory, maintaining their guidance for reaching contribution margin neutrality in Instamart within the projected timeframe.

As the quick commerce and food delivery landscapes continue to evolve, Swiggy appears well-positioned to capitalize on market opportunities while focusing on profitability and customer experience improvements.