Prosus Warns: High Investments in Quick Commerce Drag Swiggy Profitability Despite Strong Growth
Swiggy Core Business Drives Margin Expansion Amid Q-Commerce Investment Push
Prosus, a significant investor holding 22.31 percent in Swiggy, has issued a cautious assessment regarding the company's financial performance for the January-December 2025 period. The Dutch technology investor noted that while Swiggy’s core food delivery operations saw substantial gains, these profits were offset by intensified investment within the quick commerce segment.The FY26 annual report highlighted that Swiggy's food-delivery business more than doubled its adjusted earnings before interest, taxes, depreciation and amortisation (aEBITDA). This signifies robust underlying health in the established delivery services, despite the aggressive expansion into new verticals.
Meanwhile, metrics related to customer base growth showed consistent momentum across the board. Swiggy reported a 46 percent growth in gross order value (GOV) during the year. Furthermore, the number of monthly transacting users increased by 37 percent year-on-year, reaching 24.3 million.
Instamart Emerges as Rapid Growth Engine
The quick commerce platform, Instamart, continued to be one of Swiggy’s most dynamic verticals. This vertical witnessed an impressive 105 percent year-on-year growth in Gross Order Value (GOV).To support this hyper-growth, the dark store network significantly expanded, reaching a total of 1,136 stores. The commitment to quality and service was reflected as the average order value within Instamart rose by 40 percent over the period.
In addition to Instamart's performance, the core food delivery business also showed signs of healthy margin expansion. This segment recorded a GOV increase of 19 percent, buoyed by steady user additions and traction from diversified offerings. These include services such as Bolt, One BLCK, Food on Train, and 99 Store.
Unit Economics Improvement in Quick Commerce
Despite the continuous investment cycle required to remain competitive in the fast-paced market, Prosus stated that Swiggy demonstrated improvement in unit economics within quick commerce. This focus on operational efficiency is critical for long-term stability.The commitment towards sustainable growth was evident as management adjusted promotional intensity in the fourth quarter of 2025. This strategic shift aimed to improve financial health directly impacting Instamart’s performance.
Instamart's contribution margin saw a marked improvement in Q4 2025, reaching -2.5 percent of GOV. This is a notable turnaround from the -4.6 percent contribution margin recorded one year earlier.
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