Startup Originals Team
Swiggy, one of India’s largest food delivery and quick commerce platforms, has posted impressive revenue growth for the first quarter of FY26 but also reported a considerable increase in net loss. New innovations and expansion efforts have contributed to both top-line gains and steeper expenses, setting the stage for a pivotal year ahead for the company.
Record Revenue Growth:
Swiggy’s operating revenue rose sharply by 54% year-on-year, reaching ₹4,961 crore in Q1 FY26, up from ₹3,222 crore in Q1 FY25. When including other income streams, Swiggy’s total revenue touched ₹5,048 crore for the quarter.
Segment Performance:
- Scootsy Logistics: Contributed 46% of Swiggy’s operating revenue, with income growing 78% year-on-year to ₹2,259 crore.
- Food Delivery: Accounted for 36% of total revenue, posting a 19% growth to ₹1,800 crore from the previous year’s ₹1,518 crore.
- Quick Commerce (Instamart, etc.): Revenue doubled, reaching ₹806 crore, driven by higher order frequency and expansion through new dark stores.
- Other Verticals (Dine Out, Genie, Swiggy Mini): Added to overall revenue and show Swiggy’s efforts to broaden its ecosystem.
Losses Nearly Double as Costs Increase:
Despite revenue gains, Swiggy’s net loss nearly doubled to ₹1,197 crore in Q1 FY26 from ₹611 crore in the same period last year. This steep rise in losses was primarily attributed to a 60% jump in total expenditures, which climbed to ₹6,244 crore from ₹3,908 crore last year.
Expense Breakdown:
- Supply Chain Distribution (FMCG Procurement): Accounted for 33% of costs, rising 72% to ₹2,064 crore.
- Delivery Charges: Increased 26% to ₹1,313 crore.
- Employee Benefits: Rose to ₹686 crore.
- Advertising and Promotions: Swelled to ₹1,036 crore.
Swiggy’s management attributed these rising costs to its focus on scaling up quick commerce, increased marketing, and continued investment in expanding operational capacity.
Management Commentary and Strategy:
CEO Sriharsha Majety emphasized the company’s ongoing commitment to building a convenient, large-scale ecosystem, acknowledging that heavy investments are expected before long-term profitability is achieved. Swiggy plans to double down on food delivery, quick commerce, events, dining, and experimental product launches for further growth.
Board Reshuffle and Leadership:
Swiggy made significant changes to its board, with Sumer Juneja (SoftBank) and Anand Daniel (Accel) stepping down as nominee directors. Faraz Khalid, CEO of noon (a Middle East commerce platform), was appointed as an independent director. This move aims to steer Swiggy through its next growth phase with fresh perspectives.
Market Response:
Swiggy’s shares traded at ₹403.95 apiece at the close of July 31, with the company’s market capitalization crossing ₹1,00,730 crore, reflecting strong investor interest despite the mounting losses.
Competitor Snapshot:
Zomato’s parent company, Eternal, reported a 70% rise in revenue to ₹7,167 crore for the same quarter. However, its profit after tax declined to ₹25 crore, highlighting intense competition and margin pressures in the sector.
Swiggy’s Q1 FY26 results reveal a company in transformation-achieving phenomenal revenue growth while facing the financial strains of aggressive expansion. The next few quarters will be crucial as Swiggy aims for sustainable profitability in India’s rapidly evolving delivery and commerce market.
