Good morning [%first_name |Dear Reader%],

You may have already read the headlines on foodtech Zomato Ltd’s quarterly results over the weekend.

Most of them had to do with one or more of these facts:

• Its losses for the three months ended December 2022 widening 5X to ~Rs 345 crore (US$42 million)
• Its decision to exit around 225 cities whose performance was “not very encouraging”
• Its plan to increase e-grocer Blinkit’s dark stores, or small warehouses, by 30-40% in the next year
• Its plan to turn Zomato Instant, a 10-min food-delivery service, into Zomato Everyday, an offering focussed on “home-style cooked meals”

The last one on the list is no big deal since few expected Zomato Instant, with its awful unit economics and delivery challenges, to succeed.

But the others are a bit more significant.

Investors are closely watching what Zomato can do with Blinkit, a middling brand with multiple identity crises that Zomato bought in June—for Rs ~4,450 crore (US$539 million). And the first two are material concerns, tied to other equally worrying numbers.

There is, however, a bright spot in all this.

Zomato’s bleak numbers have a silver lining

If you go back to Zomato’s letter to its shareholders for the quarter ended 31 December, 2021, you’ll find this paragraph in a section of its own:

Zomato’s food-delivery gross order value (GOV) on the last day of 2021 was also significantly higher than the December quarter’s average daily GOV of US$8 million, a period that’s usually good for the food-delivery business.

But 2022 was different.

In Zomato’s latest investor letter, there’s no mention of the company’s performance on New Year’s Eve. Instead, you get this:

What you don’t see here is the decline in the number of orders between the September and December quarters, which in turn led to the minor fall in revenue.