Deliveroo weighed down by costs linked to DoorDash acquisition

A loss of 19 million pounds instead of a net profit of almost 32 million pounds. Deliveroo's accounts aren't looking good. But the company is explaining it and trying to show that the fundamentals (and the future) are good.

Photo : Deliveroo press

It will take some time before we return to the good fortune of last year. For Deliveroo, things are not looking good, and the food delivery specialist is back in the red under the weight of its acquisition by DoorDash.

After posting a half-year profit for the first time in 2023, Deliveroo is once again recording losses. The British food delivery platform announced a negative net profit of 19.2 million pounds for the first six months of the year, compared to a profit of 1.3 million pounds a year earlier. The reason: the costs related to its acquisition by the American company DoorDash, announced last May. A deal worth 2.9 billion pounds.

Improving operational performance

According to the firm, which shared its accounts yesterday, excluding exceptional expenses, Deliveroo would have generated a net profit of 31.8 million pounds. The message is clear for Will Shu, CEO and founder of the delivery company: without the acquisition and the related costs, the results would have been in the black. He confirms the continued improvement in its margins: adjusted operating profit increased by 46% year-on-year to 96.3 million pounds, driven by sustained growth in business.

Commenting on Deliveroo's figures, its CEO said he's waiting to see what the DoorDash acquisition can bring. The merger with DoorDash is part of a global consolidation movement in the food delivery sector. This highly dynamic market is hyper-competitive and requires significant investment. DoorDash, the US market leader with $10.7 billion in revenue in 2024, is thus acquiring a player well established in the UK and nine other countries, including Belgium.

By combining their strengths, DoorDash and Deliveroo aim to create a large-scale, multi-category platform, covering both dense urban areas and less populated territories. DoorDash plans to continue its investments to support growth, expand its uses (food delivery, retail), and increase the appeal of its model among delivery drivers. The company intends to quickly apply to Deliveroo the methods already deployed with Wolt. For Deliveroo, this collaboration offers the opportunity to consolidate its competitive position by sharing technology, marketing actions, and logistics infrastructure. However, in the short term, the burden of costs associated with the transaction is a reminder of the price to pay for joining a larger group in a sector still seeking stability between expansion and profitability.