Eternal Ltd, the parent company of Zomato, reported its Q2 FY26 earnings today, revealing a sharp decline in profitability despite robust revenue growth. The company posted a net profit of ₹65 crore, down 63% year-on-year from ₹176 crore in Q2 FY25. This steep drop in earnings triggered a 4% decline in the stock price during intraday trade, reflecting investor concerns over margin pressures.
Financial Highlights
- Net Profit: ₹65 crore, down 63% YoY, but up 160% QoQ from ₹25 crore in Q1
- Revenue from Operations: ₹13,590 crore, up 183% YoY and 90% QoQ
- Total Income: ₹13,942 crore (includes ₹352 crore in other income)
- Total Expenses: ₹13,813 crore, up from ₹4,783 crore YoY
Despite the profit decline, Eternal’s top-line performance was impressive, driven by strong growth in its food delivery and quick commerce segments. The quick commerce business, which includes Blinkit, saw net order value growth of 137% YoY and 27% QoQ, marking its best performance in nearly three years.
Segment Performance
- Food Delivery: Grew 23% YoY, with profitability reaching 5.3% of net order value
- Quick Commerce (Blinkit): Losses narrowed to ₹156 crore, with significant order volume growth
- Platform Expansion: Eternal continues to scale operations across Tier 1 and Tier 2 cities, focusing on logistics and customer retention
Market Reaction
The stock initially dropped 4% post-results, reacting to the sharp decline in net profit. However, strong revenue growth and operational improvements helped the stock recover partially, touching a 52-week high of ₹368.45 later in the session.
Strategic Outlook
Eternal’s management reiterated its focus on balancing growth with profitability, especially in the quick commerce vertical. Investments in technology, delivery infrastructure, and customer experience remain central to its long-term strategy.
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Conclusion
Eternal’s Q2 results reflect a company in transition — scaling aggressively while managing profitability challenges. While the profit miss raised concerns, the revenue surge and operational improvements suggest long-term potential. Traders and investors should monitor upcoming quarters for margin trends and segment-level performance, especially in quick commerce and food delivery.
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