Zepto’s Revenue Doubles in FY26, but Losses Surge to ₹5,905 Crore Ahead of IPO

Quick commerce platform Zepto has reported strong revenue growth in FY26, even as rising costs pushed its losses significantly higher.

Zepto Reports Sharp Revenue Growth in FY26 While Losses Widen Amid Aggressive Expansion

IPO Plans Take Center Stage

Quick commerce startup Zepto has taken a significant step toward its public listing by filing an updated draft red herring prospectus (UDRHP) with the Securities and Exchange Board of India (SEBI). The company aims to raise ₹8,010 crore through a fresh issue in its upcoming initial public offering (IPO).

The filing offers a detailed look into Zepto’s financial performance for FY26, revealing a mix of strong revenue growth and rising losses. While the company has successfully scaled its operations, the cost of expansion continues to weigh heavily on its profitability.

Revenue Doubles on Back of Rapid Growth

Zepto reported a remarkable doubling of its revenue from operations in FY26. The company generated ₹22,624 crore during the fiscal year, compared to ₹11,110 crore in FY25, reflecting its rapid expansion in the quick commerce space.

This growth has been driven by increasing consumer demand for ultra-fast deliveries and the company’s aggressive push to expand its presence across major cities. Zepto’s ability to deliver products within minutes has helped it capture a significant share of the growing market.

Expanding Network and Order Volume

As of March 2026, Zepto operated more than 1,139 dark stores across India. These micro-warehouses enable the company to deliver over 46,600 products across various categories within a short time frame, typically around 10 minutes.

The company’s scale is evident in its daily operations, with more than 1.75 million orders being processed every day. This high order volume highlights the increasing reliance of consumers on quick commerce platforms for everyday needs.

Product Sales Drive Majority of Revenue

The sale of products remains Zepto’s primary source of revenue, accounting for approximately 78% of its total operating income. This segment grew by 92% year-on-year, reaching ₹17,588 crore in FY26 compared to ₹9,145 crore in the previous fiscal.

The strong performance in this segment reflects the company’s focus on expanding its product range and improving availability, ensuring that customers can access a wide variety of goods quickly and conveniently.

Ancillary Revenue Streams Show Strong Momentum

In addition to product sales, Zepto has been building multiple ancillary revenue streams that have shown impressive growth. Revenue from warehousing, packaging, and last-mile delivery services more than doubled to ₹2,780 crore in FY26.

Advertising revenue also saw significant growth, increasing 2.5 times to ₹1,636 crore. This indicates that brands are increasingly leveraging Zepto’s platform to reach consumers directly. Meanwhile, platform services contributed ₹564 crore, adding further diversification to the company’s revenue base.

Zepto also generated ₹505 crore from non-operating income, such as interest on fixed deposits, bringing its total income to ₹23,128 crore for the year.

Rising Costs Reflect Aggressive Expansion Strategy

Despite strong revenue growth, Zepto’s expenses rose sharply as the company continued to invest heavily in scaling its operations. Procurement of products remained the largest cost component, accounting for 63% of total expenditure.

This expense increased by 90% to ₹18,199 crore in FY26, compared to ₹9,542 crore in FY25. The rise reflects higher order volumes and the need to maintain inventory across an expanding network of dark stores.

Employee and Operational Expenses Increase

Employee benefit expenses also rose significantly, growing 44% to ₹1,785 crore. This includes ₹557 crore in ESOP-related costs, which are non-cash expenses. A portion of these costs, amounting to ₹192 crore, was attributed to personnel working in warehouses and dark stores.

Delivery and handling expenses surged more than 90% to ₹3,046 crore, driven by increased order volumes and logistics requirements. Additionally, the cost of maintaining the company’s network of dark stores reached ₹2,150 crore.

Advertising and promotional expenses climbed to ₹1,389 crore as Zepto continued to invest heavily in customer acquisition and brand visibility.

Technology and Overhead Costs Add to Spending

Zepto’s software-related expenses increased by 31% year-on-year to ₹300 crore, reflecting ongoing investments in technology infrastructure. These investments are critical for maintaining efficient operations and enhancing the user experience.

Other overhead costs, including store operations, franchise expenses, power and fuel charges, and legal and professional fees, also contributed to the overall rise in expenditure. As a result, Zepto’s total expenses surged 79% to ₹29,027 crore in FY26.

Losses Widen Despite Revenue Growth

Despite doubling its revenue, Zepto reported a net loss of ₹5,905 crore in FY26, up from ₹4,700 crore in FY25. The increase in losses underscores the challenges of balancing rapid growth with cost management in the highly competitive quick commerce sector.

The company’s EBITDA margin remained negative at 23.18%, while its return on capital employed (ROCE) stood at negative 74.8%. These figures highlight the financial pressure associated with scaling operations at such a rapid pace.

Improving Efficiency Amid Challenges

While losses have increased, Zepto has shown signs of improving operational efficiency. The company’s expense-to-earning ratio declined to ₹1.28, indicating better cost management relative to revenue generation.

By the end of FY26, Zepto reported current assets of ₹9,638 crore, including cash and bank balances of ₹973 crore. This provides the company with a financial cushion to support its ongoing expansion and operational needs.

Competitive Landscape Intensifies

Zepto operates in a highly competitive market, facing strong competition from players like Blinkit and Swiggy Instamart. These companies have also reported significant growth, reflecting the overall expansion of the quick commerce sector.

Blinkit reported revenue of ₹37,779 crore in FY26 and achieved a positive EBITDA of ₹430 crore, indicating a move toward profitability. On the other hand, Swiggy Instamart recorded revenue of ₹3,859 crore but reported an EBITDA loss of ₹3,063 crore.

The contrasting performance of these competitors highlights the varying strategies and challenges within the industry.

Conclusion

Zepto’s FY26 performance reflects the dual nature of rapid growth and rising costs in the quick commerce industry. While the company has successfully doubled its revenue and expanded its footprint, its widening losses underscore the financial challenges of scaling at such speed.

As Zepto prepares for its IPO, investors will closely watch its ability to improve profitability while sustaining growth. The company’s future will depend on how effectively it balances expansion with operational efficiency in an increasingly competitive market.