Delivery Hero earns nearly $1b in revenue from Asia in Q3 2021

Germany-based Delivery Hero’s saw its third quarter revenue from Asia soar 88% from the same period last year to stand at 854 million euros (US$978 million).

Photo credit: Delivery Hero.

The firm’s strong topline in Asia mainly reflected revenue from food delivery startup Foodpanda, which Delivery Hero acquired in 2016 and currently operates in 12 Asian countries. Besides this, the group’s revenue figure also includes income from the Woowa Brothers business, whose acquisition Delivery Hero completed in March. However, the topline number excludes Delivery Hero’s Korea business.

Foodpanda has become a prized possession for Delivery Hero, with Asia continuing to be the German group’s largest market as the region brings in about half (48%) of its overall revenue.

Image credit: Delivery Hero

Delivery Hero also noted that its second largest market in Asia broke even on an earnings before interest, tax, depreciation, and amortization (EBITDA) basis. However, the company didn’t disclose which market.

Meanwhile, Foodpanda’s quarterly contribution margin – total sales revenue minus variable costs – in Asia broke even for the first time. The figure includes costs of marketing initiatives aimed at acquiring new users and keeping existing users. Foodpanda had earlier achieved a positive contribution margin excluding marketing costs.

Image credit: Delivery Hero

As its orders grew 55% in the quarter, Delivery Hero’s gross merchandise value (GMV) in Asia climbed over 70% to hit US$7.63 billion. Outside South Korea and Japan, Foodpanda also outpaces competitors in app downloads and active users, the company said, citing data from App Annie.

See also: Foodpanda grows revenue by 2.5x, but profit is still some distance away

The food delivery firm also noted that its investments in Asia were paying off, with its operating loss to GMV margin jumping by more than 22 percentage points since the first quarter of 2020, bringing the company closer to breakeven. However, the numbers exclude South Korea, Japan, as well as integrated verticals businesses, including all group costs.