Deepinder Goyal-led foodtech major Eternal Ltd (formerly known as Zomato) has recorded a 90% year-on-year (YoY) decline in its profit at ₹25 crore in the first quarter (Q1) of FY26 compared to ₹253 crore in the year-ago period. Eternal's revenue from operations surged 70% year-on-year to ₹7,167 crore in Q1 compared to ₹4,206 crore in the same quarter last year. The revenue also recorded a surge compared to the previous quarter's figure.

The company reported strong growth across its core metrics in Q1 FY26, with its B2C business clocking a net order value (NOV) of ₹20,183 crore, marking a 55% year-on-year increase. Adjusted revenue rose 67% year-on-year to ₹7,563 crore, while adjusted EBITDA stood at ₹172 crore, up 42% from the same period last year.

Blinkit drives growth

The company’s quick commerce segment, led by Blinkit, maintained its growth momentum with the addition of 243 net new stores during the quarter. NOV from quick commerce surged 127% year-on-year (and 25% quarter-on-quarter) to ₹9,203 crore. For the first time, this surpassed the quarterly NOV of its food delivery business, says the company.

Eternal also says that its quick commerce arm showed signs of improving profitability, with adjusted EBITDA losses narrowing to ₹162 crore in Q1 FY26 from ₹178 crore in Q4 FY25. The EBITDA margin improved from -2.4% to -1.8% in the NOV quarter-on-quarter.

Albinder Dhindsa, CEO of Blinkit, says the company is on track to get to 2,000 stores by December 2025. "We also added 0.4 million sq ft of warehousing space and now operate over 5.6 million sq ft of warehousing space across the country (including store area, we now manage ~10.4 million sq ft across our entire supply chain). On the profitability front, the margins improved from -2.4% of NOV in Q4 FY25 to -1.8% despite continued investments in new store roll-outs and seasonal factors."

On the rising competition in the quick commerce space, Dhindsa says the opportunity is "massive," and the competition is also very "high." "We see an influx of new players in this segment every now and then, and we see varying aggression by existing competitors depending on their balance sheet and near-term growth objectives. Under no circumstances will we let go of our market position here, and lose sight of the size of the prize in the long term."

He also said the company has visibility to get to 3,000 stores, but for now the target is to reach the milestone of 2,000 stores by December 2025.

Food delivery business sees subdued demand

The food delivery business NOV increased 13% year-on-year and 9% sequentially, reflecting softness in demand. However, margins improved: the adjusted EBITDA margin rose to 5.0%, up from 3.9% a year ago. On the NOV growth in food delivery dipping to 13% YoY from 14%, CEO Deepinder Goyal says the YoY growth (in food delivery) is likely to bottom out now as the company recovers from the demand slowdown seen in late 2024. "For FY26, it looks unlikely that the business will deliver a 20%+ NOV growth but we should be north of 15% and hopefully trending towards 20% YoY growth in FY27," he said.

District business shows promise

Eternal says its 'District' business, an in-house private label offering fresh, ready-to-cook, and ready-to-eat food products, is growing in the right direction to become a "profitable business." Goyal says 'Going-out' is now a ₹8,000 crore annualised NOV business, which is about 20% of the size of its food delivery and quick commerce businesses. "And, on a like-for-like basis, growing at 30%+ YoY."

He said in Q1 FY26, the company saw about 2 million average monthly transacting customers transacting twice a month on average with a net average order value (NAOV) of over ₹1,700. "We are building District as a one-of-a-kind platform for 'going-out' in India by offering large 'going-out' use cases including dining-out, movies, sports, concert ticketing, etc., on a single app, for the most premium customer base in the country."

Goyal on rising competition in Q-comm

On being asked about risks from new entrants in food delivery, Goyal said new ideas, new entrants, and disruption are all inevitable. "I think it also makes our business stronger as long as we are able to learn, adapt, and out-innovate potential competition. At this point, we do not see any innovation in the space which makes us believe that this business is under any obvious threat."