Food delivery service Deliveroo announced on Thursday that it has achieved its first annual profit, with both orders and revenue on the rise. This milestone comes after several years of significant losses due to high investment costs since the company was founded in 2013 by American Will Shu, who made the company’s first delivery in London.
Deliveroo posted a profit after tax of £2.9 million ($3.8 million) for the previous year, a significant turnaround from a loss of £31.8 million in 2023. Revenue grew by two percent to nearly £2.1 billion, and orders also saw a two percent increase, according to the company’s earnings statement.
Despite an uncertain consumer environment, Will Shu expressed confidence in the company’s ability to maintain growth. “While the consumer environment remains uncertain, I am confident that we can continue to deliver growth,” Shu said in the release.
Looking forward, Deliveroo plans to focus on helping restaurant partners meet untapped consumer demand, expanding into new occasions, and increasing its grocery and retail offerings.
Deliveroo currently operates in the UK and Ireland, Belgium, France, Italy, Kuwait, Qatar, Singapore, and the UAE. However, it has exited markets like Australia, the Netherlands, and Spain in recent years, with the latter seeing the company leave after Spain became the first EU nation to grant food delivery riders employee rights.
The company, which saw a surge in demand during the COVID-19 pandemic, relies on tens of thousands of self-employed riders, a status that has stirred controversy. In late 2023, the UK Supreme Court ruled that Deliveroo riders were not entitled to trade union rights, such as collective bargaining.
The company has also faced scrutiny regarding its sustainability, notably after its failed stock market debut in 2021. The IPO, which was London’s biggest in a decade, initially valued Deliveroo at £7.6 billion. However, the share price plummeted almost one-third on launch day, amid concerns over its treatment of self-employed riders.
Despite the profit milestone, Deliveroo’s share price slid by 4.7 percent to £1.19 in early London trading.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, commented, “It’s been a long hard slog, but Deliveroo has finally climbed the tough summit of reaching annual profitability. But it’s not going to be freewheeling from here, and the uncertain economic environment points to a wobbly ride ahead.”
