Delivery Hero confirms yearly forecast, but soft Asia knocks shares

By Paolo Laudani and Linda Pasquini

(Reuters) -German online takeaway food company Delivery Hero confirmed its 2025 guidance on Thursday, but a slip in growth in its crucial Asian market led investors and analysts to question the upbeat narrative for the region.

GMV, a common metric for delivery firms measuring the total value of all goods sold, grew 5% to 12.37 billion euros ($14.03 billion), broadly in line with analysts' estimate of 12.34 billion euros in a company-provided poll that was based on reported currency and assumption of high inflation.

In the core Asian market, the company's quarterly GMV fell to 5.4 billion euros from 6.1 billion euros a year earlier and slightly missed consensus expectations.

The region, Delivery Hero's most important one since its $4 billion deal in South Korea in 2019, accounts for roughly one third of its global sales.

"We think this weakness will likely play into competitive concerns in the Korean market," analysts from UBS said in their note to investors.

The Glovo owner's shares fell as much as 10% in early trading, with a trader pointing to weaker business in Asia. They were down 4% as of 0911 GMT.

In a call with Reuters, Chief Financial Officer Marie-Anne Popp reiterated the company's optimistic stance on South Korea, saying it expected the market to return to growth this year.

"We're in the process of rapidly ramping up on delivery," Popp said about the market. "We also probably had a customer value proposition that wasn't good enough."

She said Delivery Hero was addressing a lot of the things where it could and should be better, with some improvements already in place.

The company on Wednesday said it would stop operating its platform in Thailand in May. Popp said the group considers a market's profitability and maturity when assessing its presence, including possible exits.

"Not being profitable is not necessarily a sense that things are not going well. It's also a level of maturity," she said, adding Delivery Hero had no current plans to enter other markets.

($1 = 0.8818 euros)

(Reporting by Paolo Laudani and Linda Pasquini in Gdansk; editing by Milla Nissi)