Delivery Hero SE (DHER) Earnings Call Transcript
October 28, 2026
Earnings Call Speaker Segments
Welcome to the Delivery Hero Q3 2026 Trading Update. Today's presentation will be followed by a Q&A session. [Operator Instructions] I will now hand over to Andrea Braz to begin the presentation.
Thank you, and good morning, everyone, and welcome to Delivery Hero's Q3 2020 Trading Update Call. My name is Andrea -- for us, and I head Investor Relations and Communications and Delivery Hero. With me today are Nik a Sosberg, our CEO; and Marianne Pop, our CFO. Together, they will present the key highlights of a strong third quarter. As you know, we are currently in the acceptance period of Uber's takeaway offer, which ends fifth of November. For questions about the offer, please refer to Uber's offer documents until the joint recent statement published by our management and Supervisory Board on the second of September and supplemented yesterday. Today's call will focus on Delivery Hero's operating performance. I also need to highlight that today's call contains forward-looking statements, which are subject to risks and uncertainties. Unless stated otherwise, all growth rates are year-on-year and on a like-for-like basis. And with that, over to you, Niclas.
Thank you, and hey, everyone. Q3 was an exceptionally strong quarter. growth accelerated for the fourth quarter in a row, allowing us to deliver a record 1 billion orders in a single quarter. GMV grew 14%. A year ago, we were growing at 7% and -- since then, every single quarter has been faster than the 1 before. Revenue grew even faster at 22%. The key contributors of the faster growth were quick commerce which delivered GMV growth of 39% on a like-for-like basis and ad tech revenue. The message is simple. Our everyday app strategy is delivering. Our investments in our customer proposition are translated into record orders and accelerating GMV growth. So what's behind this? Well, we are focused on 1 thing and 1 thing only, and that is to make the customer experience better. And it's not just about improving restaurants deliveries, about getting customers to engage with us every day across different verticals. We do that in 3 different ways. First, more choice, we want to be the app customers open for the everyday needs, not just for dinner. That is why we keep expanding Quickmers. Our own stores Dmarts are key to our quick commerce growth as they enable customers who already use us for food to now also use us for their weekly shopping. -- as we prove that we can be the reliable everyday partner, customer use us for more verticals and more food. Second, more value to our customers. we make it more affordable to order with us and to order more often. Our subscription programs give members lower delivery fees and exclusive deals and exchange for their loyalty and subscribers now account for more than half of our GMV. We also work with restaurants and retail partners to fund deals for customers. So these customers get better prices without us simply spending more on marketing. Third, better service, customers expect their orders to arrive fast and right. We benchmark ourselves against competitors market-by-market. And in almost all of them, we are fast or faster than our competitors. Riders spend less time waiting so food arrives sooner. When choice, value and service improve together, customers order more often and stay with us longer. That is what you see in our growth in this quarter. Part of what enables us to improve the customer experience is how fast we're improving our product. And this year, we are improving it at a much faster pace with new features contributing much more incremental GMV than last year's future releases. And a key reason is, of course, I co-development and our in-house autonomous coding agent, Herogen, helps us ship much faster today than a year ago, shipping faster means a better product, a better product brings more orders. So this sharp focus on customer experience is what has enabled us to deliver close to SEK 1 billion of incremental quarterly revenue over the last year with no incremental marketing spend. Also here, we see big upside from AI. We acquired more customers than ever at a lower cost. Customers are choosing us because the product is better, not because we're spending more on customer vouchers and they come back more often. With the improvement in lifetime value and reduction in acquisition cost, we can start to invest a bit more in marketing at good returns. Looking forward, our products have not changed. We build depth in every market through the everyday app. That means more choice, more value and better service with continued investment in Quick Commerce. Because we are looking to drive growth that is sustainable that means continue to invest to ensure that we have the best customer experience. We will do so in a disciplined way. We will also remain focused on delivering higher free cash flow per share. Finally, a quick update on the Uber takeover offer. We are currently in the acceptance period, which ends on fifth November at midnight Central Europe in time, shareholders who would like to tender need to make sure that they do so through their custodian bank before the deadline. -- additional acceptance period is expected to start on 11th November and run until 24th of November. Regulatory reviews are ongoing and still expect to allow for closing in the second half of '27. Until then, we continue to operate as an independent company and our teams stay focused on our customers. They do that very successfully as today's results show. And before handing off to Marianne, I would also like to take the opportunity to update you on the sale of our business in Taiwan. The local regulatory authority did not approve the transaction, and it has now been terminated. As a result, we will be receiving the agreed break fee from grab. With that, I hand over to Marianne.
Thank you, Nicolas, and hello, everyone. Let me start with the group. In Q3, we delivered more than 1 billion orders in the quarter for the first time, a great milestone to cross. Order growth accelerated to 11% and up from 8% a year ago. GMV reached EUR 13.9 billion, up 14% like-for-like with larger average basket sizes supported by faster quick commerce growth. In reported currency, GMV was also up 14%. So currency is no longer a drag at group level. Revenue reached EUR 4.3 billion, up 22% like-for-like and 23% in reported currency. Revenue continues to grow faster than GMV, thanks to quick commerce and adtech. Now focusing on our platform business, which includes all GMV transacted through our apps and websites. GMV grew 14% to EUR 13.9 billion, and revenue grew 17% to EUR 3.3 billion. Growth was strong across all our regions with similar drivers as we execute on our everyday app strategy consistently across brands. The drivers, as explained by Nicolas, have primarily included strong growth of quick commerce, high take-up of our subscription programs, which drive loyalty and orders and overall improvements in the customer experience resulting from our investments in the last year. Revenue in integrated verticals, mainly our own stores, Dmart, grew 43% to EUR 1.2 billion. This was another record quarter for DMart GMV growth. We see strong adoption in Korea through subscriber offers, more capacity in MENA and continued strength in Latin America. A dense store network means more orders and faster delivery with same-store sales continuing to be the largest driver of growth. This brings me to our outlook. Given the strong momentum, we are raising our guidance for the full year again. GMV growth is now expected at 10% to 12% like-for-like, up from 9% to 11% like-for-like. Revenue growth is now expected at 18% to 20% like-for-like, up from 17% to 19% like-for-like. Adjusted EBITDA is now expected at EUR 980 million to EUR 1.02 billion, up from EUR 960 million to EUR 1 billion. Free cash flow before extraordinary items now expected to be more than EUR 300 million, up from more than EUR 250 million. The larger increase here reflects better working capital performance on the back of stronger GMV growth. To sum up, our investments in the customer experience and everyday app are paying off with faster growth and better profitability. We see further opportunity ahead, and we'll keep investing with discipline to deepen our presence in each market and become the everyday choice for more customers. We will provide further guidance for 2027 with our full year 2026 results. We're now looking forward to taking your questions. Operator, please go ahead.
[Operator Instructions] Our first question comes from Casey McGee with UBS.
Just on Taiwan, obviously, following the FTC's decision on the Grab transaction, while I appreciate Taiwan is not an explicit condition to the Uber deal closing, what, if any read across do you see for the broader regulatory process? Is there anything that could change your confidence around the expected 2H '27 deal close in general?
I think a quick answer on that is no. We have not seen any change. I think in many places, I don't know we had rather than that positive feedback. So yes, no, I don't think in anything in our view.
Your next question comes from Andrew Ross with Barclays Capital.
I've got 3 questions, if that's okay. The first 1 is just back on Taiwan. Just to clarify your comments in the opening remarks. It sounds like you're not planning on appealing about rolling and you take break fee. Just want to confirm that is correct. The second one, also on Taiwan. So whilst we understand that Lepeoffer is not conditional on Tan? Iguess, clearly, there is potentially an antitrust situation that could emerge. Does it change anything for you? Like what's the state of play of Taiwan now? Are you kind of actively looking for other options there or not? And then the third question is on antitrust. Nicolas, you kind of made a comment just for and answered the first question so far, feedback has been positive. Hoping you can elaborate a bit on that and give you some update in the key jurisdictions. But do you need approval of the offer to become conditional. I'm curious as to what kind of level of involvement you guys are actually having in that process or whether it's more down to be?
Yes. So it's not our decision to appeal or not appeal. It's grabs decision, and there will be no appeal. So there will be a break fee that is going to be paid very shortly. On state-of-play, condition present, it is not much, I can say, -- we -- yes, we -- yes, we will have to now evaluate what it means the Taiwan declined I think we have a good business there. I don't think there are any plans or there are no plans at this moment point in time. But of course, that can always change. Then when it comes to antitrust, look, we are not the 1 doing the filings. So I don't know the best would be to speak to Uber or SSW, they will have, I don't know, way more answers to this. But -- and we -- from what we understand, and we haven't been any negative comments or remarks from -- as far as said we have heard. So yes, that's -- but I think overall, I should speak to Uber and SSW, but I haven't heard anything negative.
Your next question comes from askance with Jo Bamberg.
Yes. It's 3 additional ones from my side. to my knowledge, has never been the breakup fee issues. Can you give us at least an indication if this is relevant -- or is it a rather low amount as you were expecting that the Taiwan deal would go through? The second 1 is on the development on the European division. Still growing somewhat below the group. Are there any particular geographies to mention, which are currently slowing down the development in Europe. And the third question would be on litigations. We have not heard a lot from the litigation cases recently. Can you give us a quick update how the important cases mainly in Spain and Italy are going.
Right. I can comment on the break fee is part of NDA with Grab. But of course, you will see it in our full year financial results. but appropriate deal protection, I would say. When it comes to Europe, it is -- we do have a lot of changes, so had a lot of changes during the last year or so when it comes to employment of Ryder, in some cases, moved from employment of freelance versus employment of riders. And of course, that drives cost for consumers is a much higher cost for them to carry. It's a worst experience for customers. So that, of course, puts some way into the growth of those countries that had that change. We do have a few more of those cases in Europe as we transition into PWD, so the transposition of the PWD. That is, in most cases, you can still operate with freelance. In some cases, you may not be able to -- and in cases by operate freelance, you might have to change the way you are operating the freelance -- it might make limiting a little bit ability and flexibility there. So some of those things have had a slight constraint on growth given that it's worse in the service and the cost for consumers. But I think we I think the transposition is more or less fully completed at the end of the year. In many cases, we have already changed our model. to be compliant with new legislation as well. When it comes to litigations, I don't -- we mentioned Spain, Italy, not much new in Spain and a double continue to proceed to Supreme Court most likely. And yes, that takes time. When it comes to Italy, we have worked very closely the pointed there. And I think that's been a good discussion. We have done a few improvements that they have requested, and I hope that we will yes, we are business as usual, but even more business as usual in the short term. Discussions have been good so far. I hope that helps. Thanks.
[Operator Instructions] Next question comes from Jurgen Ku with Kepler Chevreaux.
Very much indeed. Most of the questions have been asked. One is still remaining here, and that's on South Korea. I think you mentioned that you experienced healthy growth in Q3. I was wondering if you could maybe elaborate a little bit about, a, the situation in South Korea overall? And what you call healthy growth in this respect.
Jurgen yes, a good try. Yes, overall, very happy. Korea is a big part of our Asia segment, of course, it gives you a direction at least it's a positive growth given the size of the business, of course, is a much more mature business than we have in the rest of Delivery Hero. So of course, we will have lower growth rate there versus in Latin America, Middle East and so on. So -- but overall, we are happy, stable growth, solid. I still think there are a lot of opportunities. There is an area is a country where I think we will invest a little bit more given the opportunity and landscape we have there to making sure that we always have the best customer experience in the market at any point in time. And yes, how the healthiest difference per market. I think in many markets, we sell healthy is 20% or 30%. As I said, in a large market, there is so mature where acquisitions are much smaller proportion of your growth. And it's rather about repeat, then of course, it reduces and limits the growth -- so yes, it's anywhere -- it's a single-digit number.
Understood. That is healthy in that market. Understood. And 1 last 1 on your comments regarding marketing. Did I interpret your comments correctly that going forward, do you think, at least to maybe increase your marketing expense ratio? Or -- was that a wrong conclusion?
Yes. I think we have proven that we can acquire customers at a lower cost, and we have proven that we can increase the frequency of those customers, and we have proven that we can get great economics of our customers and the -- of course, you can see that summarized personnel growth as well as our increased guidance and profitability and cash flow. So that means that we're getting a better return and that gives us opportunity to invest more where we see where we see that opportunity. So there is a -- yes, there is a possibility that we might not keep it flat. It might take it up a little bit next year. to yes, given the better returns that we see in customers.
This concludes the Q&A session. I'll now hand back to Nicholas Ostberg for closing remarks.
Yes. Thank you, everyone, for your questions. Let me leave you with just 1 point, and that is, of course, that our everyday app strategy is working. Customers are using us for more than the daily needs and they are coming back more often. -- our growth comes from a continuous improvement in our product, and we are confident in the rest of the year. That is why we have raised our guidance again. As we look forward, we will continue to invest with discipline to deepen our presence in each market and the can every day shows for more customers. And then finally, I want to thank all our teams around the world with a fast-changing environment for all of us, and they have stayed focused on what matters most, and there's, of course, our customers. So together with our rates and partners, they are delivering these results. I thank everyone, and everyone has -- have a good day.
This concludes today's call. Thank you, everyone, for joining. You may now disconnect.
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