By Ozan Ergenay and Michal Aleksandrowicz
(Reuters) -Delivery Hero on Tuesday raised its annual gross merchandise value (GMV) target after the online takeaway food company beat third-quarter expectations on the same metric, sending its shares up 5%.
Growth was boosted by the use of artificial intelligence to improve logistics and how the food was presented on Delivery Hero’s platforms, boosting orders, finance chief Emmanuel Thomassin told Reuters in an interview.
The German group also cited improved monetisation through its advertising technology, as well as service and subscriptions fees.
The group generated a quarterly GMV, a common metric for delivery firms, of 11.69 billion euros ($12.50 billion), slightly ahead of analysts’ forecast of 11.57 billion euros.
It sees 2023 GMV growth at the upper end of its previous outlook range of 5-7% in constant currency terms.
After the pandemic-driven boost to growth, food delivery firms have focused on reaching profitability amid waning investor confidence.
Delivery Hero said the Asia-Pacific region, its biggest in terms of GMV, reached positive adjusted core earnings (EBITDA) before group costs in October, which should help it meet the annual adjusted EBITDA/GMV margin target of above 0.5%.
The company, which reports earnings numbers only on a half-year and annual basis, expects adjusted EBITDA of around 250 million euros this year, compared to a loss of 624 million euros in 2022.
Its South Korean Woowa unit, under pressure from rival Coupang, had managed to stabilise its market share at around 77% since September, thanks to its focus on delivery service and promotional campaigns, Thomassin said.
He reiterated that the talks about the sale of the Foodpanda brand in Asia continued, but would not confirm a recent media report about the possible price exceeding 1 billion euros.
Thomassin said the planned sale was strategic and not linked to losses or lack of profitability, adding the proceeds would be reinvested in another market with better returns.
($1 = 0.9349 euros)
(Reporting by Ozan Ergenay and Michal Aleksandrowicz in Gdansk; Editing by Milla Nissi and Tomasz Janowski)
