Swiggy reported its financial results for the second quarter of FY26, and the numbers tell a story of strong growth mixed with mounting losses. The company grew its revenue rapidly, but its costs surged even faster. While Instamart, the quick-commerce arm, doubled its revenue and strengthened its market presence, the company’s overall financial health weakened. The results reveal a company expanding aggressively but still struggling to manage profitability.
Swiggy’s revenue growth picks up momentum
Swiggy’s consolidated revenue reached ₹5,561 crore in Q2 FY26, marking a sharp 54 percent year-on-year rise from ₹3,601 crore in the same quarter last year. The company attributed this growth to higher order volumes, improved customer retention, and rapid expansion in Instamart. Both food delivery and quick commerce contributed to the surge in topline.
The food-delivery business maintained healthy growth, recording a 22 percent year-on-year increase in revenue. Customers placed more orders, and Swiggy expanded its restaurant partnerships across Tier 2 and Tier 3 cities. The company also invested in marketing campaigns, loyalty programs, and premium dining partnerships to attract higher-value customers.
At the same time, Instamart emerged as a major growth engine. The quick-commerce vertical doubled its revenue during the quarter, growing from around ₹490 crore a year earlier to nearly ₹980 crore. Instamart’s growth came from a mix of wider product selection, faster delivery times, and better brand recall among urban customers. Swiggy added new dark stores in major metros and introduced express delivery guarantees that improved customer satisfaction and repeat orders.
The widening loss tells another story
Despite the strong growth in revenue, Swiggy’s losses ballooned. The company reported a consolidated net loss of ₹1,092 crore in Q2 FY26, compared with ₹626 crore in the same quarter last year. That represents a 74 percent increase in losses year over year.
The company’s expenses grew faster than its income. Procurement costs, delivery partner payouts, advertising, and depreciation all jumped sharply. Procurement and logistics alone consumed more than half of total revenue. Swiggy spent heavily on maintaining shorter delivery times, which required a larger and more expensive delivery fleet.
Marketing and advertising costs rose nearly 94 percent year on year. Swiggy launched multiple promotional campaigns to strengthen Instamart’s brand presence and attract new users. These campaigns included cashbacks, free delivery offers, and bundled discounts. Although the campaigns boosted order volumes, they also inflated customer-acquisition costs and delayed profitability.
Cost pressures remain intense
Swiggy’s management continues to chase growth in a market that rewards speed and scale. However, this approach creates heavy cost pressure. The company expanded operations aggressively across new cities, added warehouses and dark stores, and increased its workforce in logistics and technology. Each of these initiatives requires large upfront spending before generating meaningful profits.
Delivery costs form another major challenge. Swiggy competes fiercely with Zomato and several regional quick-commerce players. To retain delivery partners, Swiggy must offer competitive incentives. Rising fuel prices and higher delivery fees further inflate operating expenses.
Technology and product development costs also climbed. Swiggy invests continuously in artificial intelligence, route optimization, and predictive inventory systems to reduce inefficiencies. These investments improve long-term scalability but add to short-term financial strain.
Instamart becomes the growth star
Instamart has turned into Swiggy’s fastest-growing vertical. Consumers increasingly prefer instant grocery delivery, and Swiggy has captured a strong position in that space. Instamart’s growth more than doubled in the past year, driven by repeat customers and higher order frequency.
Swiggy introduced new features like “Under 15-Minute Delivery” and “Smart Reorder” to make shopping faster and more predictable. It also expanded product categories beyond groceries, including daily essentials, personal care, and ready-to-eat foods.
Instamart’s expansion signals a strategic shift for Swiggy. The company now treats quick commerce as a core business rather than an experimental segment. By focusing on this vertical, Swiggy aims to create a second major revenue stream alongside food delivery.
However, quick commerce operates with thinner margins and higher logistics costs. The model requires localized inventory and constant movement of goods through dark stores. Without large-scale efficiency, the business burns significant cash. Swiggy’s challenge lies in finding a sustainable cost structure for Instamart while maintaining its growth momentum.
A race for market dominance
Swiggy’s financial performance reflects the broader race for dominance in India’s food-delivery and quick-commerce markets. The company continues to battle Zomato, Blinkit, Zepto, and BigBasket’s BBNow for customer attention. Each competitor spends aggressively on marketing and customer incentives.
This intense competition keeps prices low and delivery promises fast, which customers enjoy but companies struggle to afford. Swiggy chooses to compete on both fronts: it maintains generous discounts and simultaneously expands coverage. This approach sustains growth but delays profitability.
The company believes that scale will eventually bring stability. Higher order density can reduce per-order delivery costs, and technology can streamline operations. Still, the road to breakeven looks long, and investors want clearer signs of cost discipline.
Investor and market reactions
Investors view Swiggy’s results with mixed emotions. On one hand, the company’s 54 percent revenue growth demonstrates strong demand and effective execution. On the other, the rising loss signals that profitability remains elusive.
Some analysts argue that Swiggy must slow its cash burn and focus on unit economics. Others believe that investing aggressively now will help the company secure long-term market leadership before the industry consolidates.
Swiggy’s potential public listing adds pressure. The company has considered an IPO, but sustained losses could delay those plans. Investors expect the company to prove that its growth engine can eventually turn profitable.
What Swiggy must do next
To control its losses, Swiggy must focus on efficiency. The company needs to optimize logistics, reduce delivery times without overspending, and renegotiate procurement contracts. Better route planning and warehouse automation can lower costs.
Swiggy can also strengthen its subscription programs such as Swiggy One, which encourage repeat orders and improve customer loyalty. Subscription revenue provides stability and reduces dependence on discounts.
Another key area involves data analytics. Swiggy collects enormous volumes of customer and delivery data. If it uses that data effectively, it can predict demand more accurately, manage inventory better, and minimize waste.
The company also needs to control marketing expenditure. Instead of broad advertising campaigns, Swiggy can shift to targeted digital marketing that yields higher returns on each rupee spent.
The outlook for FY26
The next few quarters will determine Swiggy’s trajectory. If Instamart continues its current growth rate, the company could strengthen its position in quick commerce. However, sustaining that growth without margin improvement could deepen the losses.
The management must balance expansion with financial prudence. Investors will closely watch how Swiggy manages to reduce losses in the second half of the fiscal year. Any improvement in contribution margin or order profitability will signal positive progress.
At the same time, Swiggy faces rising competition from both food delivery and grocery players. Maintaining customer trust, ensuring reliable service, and preserving delivery partner satisfaction will remain critical.
Final analysis
Swiggy stands at a pivotal moment. The company’s growth momentum remains impressive, and Instamart’s success proves that customers trust Swiggy beyond restaurant orders. However, the widening loss highlights structural inefficiencies that demand urgent attention.
Swiggy’s leadership team must shift focus from pure expansion to operational excellence. They must build a business that grows efficiently, not just rapidly. If Swiggy achieves that balance, it can lead India’s on-demand economy for years to come. But if it continues to prioritize growth without efficiency, the financial pressure will only deepen.
In short, Swiggy’s Q2 FY26 results reveal a company that runs fast but bleeds cash. The next few quarters will test whether it can transform strong growth into real profitability — or remain stuck in a cycle of rising revenue and rising losses.
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