Eternal, a parent company of Zomato, has reported a huge drop in net profit for the first quarter of FY26. The profit fell by 90 per cent to Rs 25 crore, compared to Rs 253 crore in the same quarter last year.
Despite the drop in profits, Eternal’s revenue from operations rose sharply. For Q1, the company earned Rs 7,167 crore, which is 70.4 per cent more than the Rs 4,206 crore it made in Q1FY25.
Expenses Increase Fast
However, rising costs hit the company’s profits hard. Eternal’s total expenses jumped by 77 per cent to Rs 7,433 crore. This sharp increase in spending ate into its profit margins.
At the same time, Eternal’s quick-commerce business, Blinkit, saw its revenue grow to Rs 2,400 crore, marking a rise of nearly 154 per cent from Rs 942 crore last year.
Quick Commerce Shift
Eternal has announced it will soon change its quick commerce business from a marketplace model to directly owning inventory over the next 2-3 quarters. This move is expected to give better control over product selection and improve margins by around 1 percentage point.
Akshant Goyal, CFO at Zomato, explained that the teams are ready for this change. He said this shift will help the business work directly with brands and also reduce Hyperpure’s non-restaurant business, as many B2B buyers were sellers on Blinkit’s marketplace.
New Subsidiary Plans
The company’s board has also approved the process to set up Blinkit Foods, a new wholly-owned subsidiary with a share capital of Rs 10 lakh. Blinkit Foods will focus on preparing, sourcing, and delivering food directly to customers.
Additionally, Eternal has appointed Aditya Mangla as the new CEO of the food ordering and delivery business under its “Rotational Leadership” model, where each CEO serves for about two years.
Aim for Agility
Deepinder Goyal, CEO of Eternal, said this approach is designed to keep leaders focused and to speed up decision-making. By rotating leadership roles, Eternal hopes to avoid complacency, encourage new ideas, and make teams stronger and more independent over time.
Interestingly, despite announcing a 90 per cent drop in profit, Eternal’s shares on Monday still rose by 5.38 per cent on the BSE, closing at Rs 271.20. This shows that investors remain hopeful about the company’s growth plans and new strategy.
