Shares in Delivery Hero, the Berlin-based food delivery giant, jumped more than 12% in early European trading today after the company released fourth-quarter results that comfortably beat analyst expectations. The stock hit €28.50, its highest level in three months, as investors cheered the firm's narrowing losses and a more upbeat outlook for 2025.
The company reported that gross merchandise value (GMV) rose 11% year-on-year in the final quarter of 2024, driven by strong demand in its core markets of Europe, the Middle East and Asia. Delivery Hero also said it now expects to deliver positive adjusted EBITDA for the full financial year, a crucial milestone after years of heavy spending on expansion and high marketing costs.
Analysts at Jefferies described the results as 'a clear positive surprise' and noted that cost-cutting measures, including a reduction in delivery fees and more efficient logistics, were beginning to pay off. 'The path to sustainable profitability is now visible, which should reassure investors who had been wary of the sector's cash burn,' they wrote in a note to clients.
The rally had a ripple effect on other food delivery stocks listed in London. Just Eat Takeaway.com rose 3.2%, while Deliveroo added 2.8%, as the broader sector benefited from renewed confidence in the business model. The FTSE 100, however, remained flat on the day, with gains in delivery stocks offset by weakness in energy and mining shares.
For UK investors holding shares in delivery companies, the news offers some relief after a turbulent 2024 that saw valuations slump on concerns over rising interest rates and slowing demand. However, analysts caution that the sector remains highly competitive, with margins still under pressure from rising labour costs and regulatory scrutiny in several European markets.