After years of turbulence in the food delivery sector, Deliveroo has turned a major corner by reporting its first-ever full-year profit. The London-based company posted a £2.9 million profit in 2024, a dramatic improvement from the £31.8 million loss it suffered in 2023. This milestone signals a potential recovery in a sector that has faced layoffs, declining stock prices, and shifting consumer habits.
Deliveroo’s profitability follows a 6% rise in Gross Transaction Value (GTV), which reached £7.4 billion in 2024. This growth is particularly notable considering the challenges the food delivery industry has endured. As economies reopened post-pandemic, consumers reduced their reliance on delivery services, leading to a downturn in the sector. Companies like Just Eat Takeaway and Deliveroo saw their stock prices plunge, while many rapid grocery delivery startups collapsed after burning through billions in investor funding.
In response to these challenges, Deliveroo implemented aggressive cost-cutting measures, including the elimination of 350 jobs in 2023. These layoffs were part of a broader strategy to streamline operations after an expansion-driven hiring spree that ultimately proved unsustainable. The company also recently announced its exit from the Hong Kong market, ending a decade-long presence there as part of its continued effort to focus on core markets.
CEO Expresses Cautious Optimism despite Profit
Despite these financial improvements, Deliveroo CEO and founder Will Shu remains cautious about future market conditions. “Whilst the consumer environment remains uncertain, I am confident that we can continue to deliver growth by focusing on the levers in our control,” Shu stated. His comments reflect the ongoing volatility in the sector, where demand fluctuates and competition remains fierce.
Deliveroo’s turnaround coincides with a broader shift in the industry. In February, Just Eat Takeaway was acquired by Dutch investment firm Prosus for €4.1 billion, suggesting renewed investor interest in the sector. While the past few years have been rocky, these recent developments indicate that the food delivery industry may be on the path to stabilization.
A key factor in Deliveroo’s recovery has been its diversification beyond traditional restaurant deliveries. In recent years, the company has expanded into grocery delivery, which now accounts for one-sixth of its total GTV. This shift aligns with changing consumer preferences, as many customers increasingly use delivery services for more than just takeout meals.
Additionally, Deliveroo has begun partnering with non-food retailers, broadening its service offerings. In 2024, the company started delivering products from brands like lingerie retailer Ann Summers and home improvement chain B&Q. This expansion into new retail categories reflects the company’s ambition to become a comprehensive delivery platform rather than solely a food courier.
Deliveroo’s ability to achieve profitability marks a significant shift, not just for the company but for the industry as a whole. After years of struggling with post-pandemic consumer behavior shifts, rising operational costs, and intense competition, this financial milestone suggests that the sector is gradually regaining stability. The combination of cost-cutting measures, market consolidation, and strategic expansion has positioned Deliveroo as a leader in an evolving industry.
Although challenges remain, particularly with consumer spending habits fluctuating and economic conditions uncertain, Deliveroo’s latest results indicate that food delivery is far from a fading trend. Instead, companies willing to adapt, diversify, and optimize operations may find themselves on firmer financial ground in the years ahead.
