Margin improvement crucial for further rerating of Swiggy

Swiggy reported a revenue of ₹4,961 crore in the first quarter of the financial year 2026 (Q1FY26), a growth of 12.5 per cent quarter-on-quarter (Qo-Q) and 54 per cent year-on-year (Y-o-Y).

- DEVANGSHU DATTA

The food delivery business' gross order value (GOV) grew 18.7 per cent Y-o-Y to ₹8,090 crore, whereas the contribution margin (CM) contracted 50 basis points (bp) Qo-Q to 7.3 per cent.

The adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) of the food delivery segment as a per cent of GOV margin dipped 50bp Qo-Q to 2.4 per cent.

The monthly transacting users (MTU) count grew by 16 per cent Y-o-Y. Instamart's GOV was ₹5,660 crore, up 107 per cent Y-o-Y. The contribution margin expanded 100bp Qo-Q to 15.8 per cent (minus 18 per cent in Q4 and minus 18 per cent in Q1FY25).

Instamart reported a contribution margin of minus 4.6 per cent (versus minus 5.6 per cent in Q1FY25).

Overall, Swiggy posted a net loss of ₹1,196 crore, up 95 per cent Y-o-Y. For Q1FY26, the adjusted EBITDA loss grew 134 per cent Y-o-Y. Consolidated adjusted EBITDA came in at negative at ₹810 crore.

The increase in average order value (AOV) was a positive surprise with AOV up 26 per cent Y-o-Y and up 16 per cent Qo-Q.