Why Swiggy is struggling despite revenue growth

Food delivery and quick commerce giant Swiggy has seen its stock plummet by 41% so far in 2025, trading consistently below its Initial Public Offering (IPO) listing price since February 6. The sharp decline reflects mounting investor concerns over the company's widening losses, intense competition, and an uncertain path to profitability.

In the January-March quarter (Q4) of FY25, Swiggy reported a net loss of Rs 1,081 crore, a significant increase from Rs 799 crore in the corresponding period of the previous fiscal year. This expanded quarterly loss occurred despite an increase in order volumes and rising revenue, as substantial investments in its quick commerce segment continue to impact overall financial performance.

The company's annual losses also surged, reaching Rs 3,116 crore in FY25, marking a 35% increase from Rs 2,350 crore in FY24, according to its latest regulatory filings. Adjusted EBITDA loss for the March quarter stood at Rs 732 crore, primarily driven by aggressive growth spending in Swiggy's quick commerce business, particularly through its Instamart service.

While Swiggy's revenue rose to Rs 5,609 crore in the March quarter, up from Rs 3,668 crore a year ago, analysts express ongoing concern about the company's ability to control its cash burn and achieve profitability.

Competitors, notably Zomato through its Blinkit arm, have intensified their presence in the quick commerce space, adding further pressure on Swiggy’s profit margins.

Despite the challenging financial figures, Swiggy CEO Sriharsha Majety defended the company’s performance, calling FY25 “a year of many firsts,” highlighting the launch of new apps like Instamart, Snacc, and Pyng.

He noted, “Our food delivery engine delivered best-ever results across innovation and execution, driving category-leading growth and rising profitability in lockstep.” Majety also stated that the out-of-home consumption business achieved profitability in Q4.

However, despite these positive internal developments, the market remains skeptical. Swiggy has struggled to regain momentum post-IPO and has spent nearly four months trading below its debut price. Brokerages indicate that while the core food delivery segment remains stable, the quick commerce division, despite its rapid growth, continues to be the primary drag on overall profitability.