Delivery Hero CEO says business is “better than ever” despite stock slump

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Delivery Hero, the Berlin-based food delivery giant whose brands include Foodpanda, has seen its share price slide despite announcing positive adjusted EBITDA. But in an email sent to employees, co-founder and CEO Niklas Östberg touted that business is “doing better than ever” despite the negative market sentiment.

“Today we just turned breakeven, which effectively means we make zero EBITDA and negative cashflow for another couple of months,” Östberg wrote in the email, which Tech in Asia reviewed. “Additionally, there are uncertainties around growth, inflation, competitive environment in Korea and Middle East, and rider fines in Spain.”

The email said that orders have grown 2.5x compared to pre-pandemic levels, while sales volume grew 18% outside of Asia. Östberg added that profitability has improved “in [the] billions.”

Competition has heated up in Korea, where Delivery Hero’s Baemin goes up against Coupang, and even more so in the Middle East – rivals of Delivery Hero’s Talabat include Deliveroo, Noon, and Careem. However, Östberg noted that current trends are “very encouraging.”

Ultimately, the CEO told employees that short-term share price is like a “voting machine that can move without much reason.”

“If we can reach our long-term ambition, then share price can easily be 10x-20x higher,” he added. “So let’s focus on making our customers happy. At least this we can control.”

Following a better-than-expected first half of 2023, Delivery Hero expects total segment revenue to grow by 15% this year, higher than its earlier estimate of 10%. Despite that, its share price closed at 29.42 euros (US$31.58) on September 13, down 33% from its 2023 peak of 43.96 euros (US$47.18) on July 4.

Just yesterday, the CEO of Baemin Vietnam – a joint venture between Delivery Hero and Woowa Brothers – announced his departure from the firm.

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Currency converted from euro to US dollar: US$1 = 0.93 euros.