Swiggy, a leading foodtech company in India, has announced a significant milestone in its Out-Of-Home (OOH) Consumption vertical in its Q3 FY25 report. The business, which includes Dineout and SteppinOut, has made substantial progress, with its adjusted EBITDA improving to just -1%. Notably, Dineout, Swiggy’s restaurant dining solutions arm, has reached profitability, while SteppinOut, its events reservation platform, continues to expand with the upcoming launch of Swiggy Scenes. The OOH business contributed INR 68 Cr to Swiggy’s total revenue of INR 3,993.1 Cr in Q3 FY25. This performance marks a turning point for Swiggy’s diversified business model, showing promising growth potential in this vertical.
1. Introduction: Swiggy’s Expanding Horizons in the (OOH) Market
Swiggy, One of India’s most popular food delivery platforms, has diversified its services to encompass Out-Of-Home (OOH) consumption. The OOH business includes its popular ventures like Dineout, which facilitates restaurant dining, and SteppinOut, which handles event reservations. According to the company’s Q3 FY25 report, Swiggy’s OOH vertical is rapidly approaching EBITDA breakeven, reflecting its growing influence in the market. This development comes as Swiggy focuses on creating a comprehensive food and event experience for customers, while Dineout has already reached profitability.
Swiggy’s success can be attributed to its dynamic business model, which capitalizes on both direct product sales and third-party partnerships. In this article, we’ll take a closer look at Swiggy’s operations, business model, funding background, and services offered as it continues to grow in this competitive market.
2. Understanding Swiggy’s Business and Revenue Model
Swiggy generates revenue through food delivery, commissions from restaurant partners, and services like grocery delivery via Instamart. With offerings in food delivery, OOH consumption, and more, Swiggy is a multifaceted platform. Its subscription programs, like Swiggy Super, enhance user value and boost customer retention.
The OOH consumption vertical, which includes Dineout and SteppinOut, is expected to play a major role in Swiggy’s future. Dineout allows users to discover and book tables at top restaurants across India, while SteppinOut helps them find and reserve spots for events. These services contribute to Swiggy’s comprehensive approach to food and leisure, enhancing its market appeal.
3. Swiggy’s Funding and Founder Background
Sriharsha Majety, Nandan Reddy, and Rahul Jaimini founded Swiggy in 2014 to connect customers with local restaurants through a food delivery platform. It has since expanded into new sectors like grocery and OOH consumption, backed by investors like Naspers, Tencent, and Prosus. The founders, with backgrounds in technology and business, have driven the company’s success, with CEO Sriharsha Majety leading its growth alongside his co-founders.
4. The Rise of Swiggy’s OOH Consumption Business
Swiggy’s OOH consumption vertical includes two key segments: Dineout and SteppinOut. Both of these services have seen substantial growth over the past few quarters. Dineout, which focuses on the restaurant dining experience, reached profitability in December 2024. This milestone signifies Swiggy’s ability to expand its business model beyond food delivery and into leisure-related services. The company’s ongoing focus on improving customer experiences through AI-driven recommendations and user-friendly interfaces has contributed to the success of Dineout.
In contrast, SteppinOut has focused on the events segment, offering users the ability to discover and book tickets for events such as concerts, shows, and festivals. Swiggy plans to launch Swiggy Scenes, a new feature under the SteppinOut brand, which is expected to drive further growth in the OOH consumption segment.
5. Financial Highlights: Swiggy’s Q3 FY25 Performance
In Q3 FY25, Swiggy reported total revenue of INR 3,993.1 Cr. The OOH consumption vertical contributed INR 68 Cr to the company’s overall revenue. This contribution underscores the growing significance of this segment, as Swiggy continues to invest in and scale its offerings. The company’s efforts to enhance Dineout’s profitability and expand SteppinOut are beginning to pay off, as indicated by the narrowing of its adjusted EBITDA to -1%.
The Q3 performance is a reflection of Swiggy’s ability to diversify its revenue streams and build a well-rounded business that goes beyond just food delivery. As competition in the foodtech space intensifies, Swiggy’s focus on innovation and user-centric services will likely continue to drive growth.
6. The Strategic Focus on Innovation and Customer Experience
Swiggy’s strategic focus on technological innovation plays a pivotal role in enhancing customer experience. The company’s use of AI, machine learning, and big data analytics allows for personalized recommendations and efficient operations. By integrating these technologies into its OOH consumption vertical, Swiggy is setting itself apart from competitors.
Furthermore, Swiggy’s loyalty program, Swiggy Super, is designed to retain customers and encourage repeat business. The program offers benefits like free delivery, discounts, and exclusive offers across Swiggy’s various services, including Dineout and SteppinOut.
7. Swiggy’s Plans for the Future
Looking ahead, Swiggy is set to continue expanding its OOH consumption business. With Dineout already profitable and SteppinOut poised for further growth, Swiggy is expected to invest heavily in marketing and customer acquisition for these services. The company is also likely to explore new partnerships and collaborations to further scale its OOH business.
As Swiggy continues to refine its operations, it is also looking to strengthen its leadership and technology teams. The company’s focus on AI, machine learning, and customer-centric solutions will likely remain at the forefront of its growth strategy.
8. Learning for Startups and Entrepreneurs
- Innovation is Key to Growth: Swiggy’s success demonstrates the importance of diversifying business offerings and innovating beyond core services. Startups should focus on adapting to market needs and technological advancements.
- Profitability in New Verticals: Swiggy’s journey from food delivery to OOH consumption shows that startups can thrive by venturing into new verticals, provided they understand customer demands and manage resources effectively.
- Customer Experience Matters: Swiggy’s emphasis on personalized customer experiences through AI and loyalty programs highlights how technology can drive customer satisfaction and business growth.
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