Eternal (Zomato) Q2 Results: 3x Revenue Growth but Profit Falls - What Investors Must Know

Eternal Limited, earlier known as Zomato, released its Q2 FY26 results, and the numbers showed a mix of blockbuster growth and tightening margins. The company’s total revenue almost tripled while profits dipped, as it continued to invest heavily in expansion and the rapid rise of its quick-commerce arm, Blinkit.

In this easy-to-follow breakdown, let’s walk through everything that changed this quarter - what improved, what didn’t, what’s driving the growth, and what the future could look like for investors and customers alike.

Key Highlights at a Glance

• Revenue: ₹13,590 crore (up 183% YoY)
• Net Profit: ₹65 crore (down 63% YoY)
• Adjusted EBITDA: ₹224 crore (down from ₹330 crore YoY)
• Adjusted EBITDA Margin: 1.75%, lower than 6.4% a year ago
• Q2 Surprise: Revenue crushed estimates, but profit lagged behind expectations.

(EBITDA means earnings before interest, taxes, depreciation, and amortization - a simple measure of operating profit.)

Overall Financial Performance

Eternal’s top line grew from ₹4,799 crore in Q1 FY25 to ₹13,590 crore this quarter - an incredible 183% jump. However, despite this strong growth, profits dropped sharply from ₹176 crore to ₹65 crore.​​

Why? Because the company spent more on delivery, marketing, and store expansion. Delivery-related costs alone surged 58%, while marketing spends nearly doubled. These rising expenses are part of Eternal’s “scale now, profit later” strategy, similar to what Amazon once did in its early expansion phase.​​

Segment-Wise Performance Growth Drivers

Source: Company filings

• Quick Commerce (Blinkit): The biggest gainer of the quarter, thanks to a major shift from a “marketplace model” (just connecting buyers and sellers) to an “inventory-led model” (owning most of the goods). Around 80% of Blinkit’s NOV (Net Order Value) now comes from inventory it owns directly. This boosted reported revenue but also increased related costs temporarily.
• Food Delivery (Zomato): After several slow quarters, growth has bottomed out, and recovery is visible with 14% YoY order growth. Profitability hit an all-time high, with an EBITDA margin of 5.3%, showing that the business is now more efficient even in a slower-demand environment.
• Hyperpure (B2B Supplies): Revenue looks lower mainly because of reclassification; earlier, a large part of Hyperpure’s supply to Blinkit sellers was booked under Hyperpure. Now, since Blinkit directly owns inventory, those sales are recorded under Blinkit revenue. Hyperpure still services restaurants and third-party businesses separately.
• Going Out (Dining & Events): Driven by recovery in dining experiences and event management services. Post the acquisition of event companies like Wasteland and Orgen, Eternal has integrated its entertainment vertical, which now powers dining reservations, offline events, and concerts through its app network.

What the Founders Are Saying About Eternal’s Future

CEO Deepinder Goyal said Q2 was a “turning point” where Blinkit proved its growth model works. The company’s focus for FY26 is stability and operating discipline. Goyal expressed confidence that both Blinkit and core delivery will grow steadily, adding that “profit improvement will follow scale.”

He also mentioned that food delivery is recovering, with gross order growth returning after five soft quarters. Eternal wants to make food more affordable and accessible, even in smaller towns.

On the inventory shift, nearly 80% of Blinkit sales now come through its own inventory (where Eternal directly owns and supplies items instead of acting as a middleman). This shift helps improve both efficiency and control, though it also temporarily slows margins.​

Share Price and Valuation

Eternal’s stock has been one of the top gainers of 2025, up 23% year-to-date, outperforming the Nifty 50’s ~7% gain.​

As of Q2 results day, Eternal share price closed at ₹340.5, down 3.9% after touching an all-time high of ₹368.45.

Based on trailing revenue (~₹31,995 crore annualized), the Price-to-Sales (P/S) ratio stands around 9.9x, compared to Swiggy’s 6.1x. This means Eternal is priced at a premium, showing investor trust in Blinkit’s future and Eternal’s proven food delivery base.​ Swiggy’s share price closed at ₹448 today, 1.2% up. In 2025, the share price of the company, however, showed a 17.4% decline to date, as per Google Finance.

Eternal's Future Outlook

Eternal’s management remains optimistic about the next year, and here’s why:

• Quick Commerce: The biggest growth pillar. Fast store expansion and rapid delivery promise to keep Blinkit’s momentum flying.
• Food Delivery: Showing slow but steady rebound with improving profitability.
• Hyperpure: Expected to benefit from synergies as Blinkit’s sourcing backbone.
• Going Out: Poised for long-term growth with more events and dining partnerships.
• Eternal Foundation: A newly added social arm for sustainability and welfare projects.

Despite temporary margin pressures, the company’s long-term playbook is clear: build scale, strengthen efficiency, and then lock in healthy profits.​​

Final Take

Eternal Limited’s Q2 FY26 results impressed with a near threefold revenue surge to ₹13,590 crore, driven by the rapid scaling of its quick-commerce arm Blinkit. However, the net profit of ₹65 crore fell significantly, down 63% YoY and missing Street estimates of around ₹108 crore by a wide margin.

According to Bloomberg and Moneycontrol analyst consensus, the revenue estimate was around ₹8,665 crore, meaning Eternal beat revenue forecasts by a strong 56%, while profits lagged meaningfully. This gap highlights the sharp rise in operational costs linked to Blinkit’s inventory shift and store expansion, which compressed margins despite the soaring topline.

On the margin front, the group’s Adjusted EBITDA margin dropped, underscoring the margin pressure from rapid growth investments. However, Eternal’s food delivery business alone hit an all-time high 5.3% Adjusted EBITDA margin, signaling operational improvements in its core segment.

Eternal’s long-term focus remains on building scale, especially in quick commerce and growing profitable food delivery penetration. The market reacted positively overall, recognizing the robust revenue growth and future potential of Blinkit even as near-term profits remain muted. This price-to-sales premium compared to peers like Swiggy shows investor confidence in Eternal’s evolving footprint and innovation-driven model.

Disclaimer

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing. The securities are quoted as an example and not as a recommendation. This is nowhere to be considered as advice, recommendation, or solicitation of an offer to buy or sell or subscribe for securities. INDStocks SIP / Mini Save is a SIP feature that enables Customer(s) to save a fixed amount on a daily basis to invest in Indian stocks. INDstocks Private Limited (formerly known as INDmoney Private Limited) 616, Level 6, Suncity Success Tower, Sector 65, Gurugram, 122005, SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500, Research Analyst Registration No. INH000018948 BSE RA Enlistment No. 6428. Refer to https://indstocks.com/pricing?type=indian-stocks; https://www.indstocks.com/page/indian-stocks-sip-terms-and-condition for further details.