Zomato, India’s most popular food delivery app, has released its third quarter earnings report in which the company posted a loss of Rs 346.6 crore. Due to this, the company has also announced that it will stop its services in 225 small towns. Regarding this, the company said that the reception of the service in these cities was not encouraging and therefore it was discontinued.
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“The current slowdown in demand is unexpected, which is impacting food distribution profit growth. But despite this, we feel we are performing well in the business to meet our profit targets,” the company said in its third-quarter report.
It is worth noting that Zomato is one of the popular food delivery apps used across the country and the company has recently launched a gold subscription to boost its profits. The company has decided to stop its services in 225 smaller cities as it plans to lay off 800 people.
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Zomato will no longer offer food delivery services in 225 small towns
In its financial earnings report, the company said in January that Zomato had stopped its food delivery service in 225 cities. According to Zomato, these cities accounted for only 0.3 percent of total revenue in the December quarter. Commenting on the move, the company said that the response to its food delivery service in these cities has not been very encouraging in the last few quarters and we do not think we will get a return on our investment in these cities. However, the company did not give any information about which cities its facilities were closed.
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