Delivery Hero Earnings: Free Cash Flow Breakeven and Talabat IPO on the Way

Delivery Hero published its first-half results, with gross merchandise value, or GMV, up 7% in constant currency and revenue up 20% in constant currency in the second quarter, ahead of the company's compiled consensus. Notably, GMV growth outside of Asia was around 23% in the second quarter and was 10% year on year in June. In turn, strong revenue growth was driven by the AdTech business, Dmart, service and subscription fees, as well as an increase in own delivery share (which carries a higher take rate). On profitability, gross profit margin for the platform business was 7.6%, flat in the second quarter, with expansion expected in the second half of the year. More importantly, in the less mature side of the business, the integrated verticals segment saw its gross margin double to 4% quarter on quarter, while at the adjusted EBITDA level, the company expects the segment to reach breakeven by December this year. In addition, Glovo's adjusted EBITDA turned positive in June. Group adjusted EBITDA was EUR 240 million, driving free cash flow breakeven in the first half of the year, as expected.