Delivery Hero raises full-year targets and exceeds expectations

Delivery Hero is a Berlin-based German food delivery service. The company operates platforms in several markets that connect restaurants and food orders with end customers. Competitors such as Uber Eats are active in comparable markets.

The raising of full-year targets marks a turning point after a phase in which the group had increasingly focused on profitability and operational efficiency. Investors and markets are watching closely to see whether the company actually achieves the higher target.

Gross merchandise volume as a key metric

Gross merchandise volume, also referred to in the industry as GMV, measures the total order value across the platform before payments to restaurants and delivery partners are deducted. A rising GMV indicates growing demand and forms the basis for commission and advertising revenues.

Alongside gross merchandise volume, investors also look at the development of operating earnings before interest, taxes, depreciation and amortization, which is typically reported in the industry as EBITDA. An acceleration in GMV combined with earnings discipline is seen as a sign of healthy growth.

In the current financial year, Delivery Hero competes against, among others, Uber Eats – the US group Uber – in European markets. Both providers are also active in markets such as Austria. Analysts see the latest development as an indication that Delivery Hero can defend or expand its market share in a competitive market environment.

Competition with Uber Eats

SSW Partners has been involved in transactions related to Delivery Hero in the past and is being watched by the market as a potential investor or advisor when it comes to restructurings or portfolio adjustments. A statement from SSW Partners on the latest quarterly figures is not available.

Under the leadership of Niklas Östberg, who has headed the company for years, Delivery Hero pursues a strategy of selective expansion and a focus on profitable markets. The raising of full-year targets is being interpreted as confirmation of this strategy.

The reaction in the capital markets was positive, even though the exact percentage movements varied depending on the trading phase. Analysts see the figures as a signal that the company could achieve the turnaround toward sustainable profitability.

Outlook for the coming quarters

For the coming quarters, the focus is likely to be on whether the company actually reaches the raised target for gross merchandise volume and whether margins continue to rise. Management's outlook and possible further measures to increase efficiency are being awaited with interest.

Overall, observers assess the latest quarterly figures as a sign that Delivery Hero is growing more strongly again after a longer phase of consolidation. The raising of business targets and the positive analyst note from Jefferies reinforce this impression.