The Underlying Business Turned a Corner. The Glovo Bet Didn't.
Delivery Hero's FY2022 annual report contains a genuinely encouraging operating signal buried under a much larger headline loss: Adjusted EBITDA of the Segments swung from -€467.2 million to a small positive Asia segment result and an improving picture almost everywhere else, and - for the first time on this site's coverage of the company - the platform business excluding Glovo posted a positive Adjusted EBITDA of €36.2 million. That's a real milestone after five years of widening losses tracked across every prior post. It's also almost entirely obscured by the headline: net result for FY2022 was -€2,975.1 million, more than 2.6 times the -€1,120.7 million loss a year earlier (restated - see Beyond the Usual). The gap is a single item: a €742.5 million goodwill impairment, recognized against the cash-generating units of Glovo, Glovo Dmart, Latin America, InstaShop, Turkey, and Honest Food - most of it tied to the Glovo acquisition this site flagged as newly closed just five months earlier, on July 4, 2022. Writing down a meaningful chunk of a deal's own goodwill within two quarters of closing it is not a rounding error in purchase-price allocation; it's a signal that either the price paid assumed too much, or the business Delivery Hero bought deteriorated unusually fast after the ink dried - and this report doesn't fully distinguish between those two explanations.
The Prescription
Delivery Hero should keep pushing toward the platform-ex-Glovo profitability milestone it hit this year - a genuinely positive Adjusted EBITDA excluding the newest, most expensive acquisition is the clearest evidence yet that the core marketplace business, absent acquisition noise, can make money at scale. Lean into whatever specifically drove Asia and MENA's improvement (subscription revenue, advertising products like "pandaAds," service fees) and roll it out faster across Europe and Americas rather than treating this year's improvement as incidental to Woowa's maturation.
What it should stop doing is closing acquisitions of this size (Glovo: €509.5 million additional consideration, a total shareholding of 94.5%) without a purchase-price allocation buffer wide enough to survive the first two quarters of actual ownership. A €742.5 million impairment within six months isn't just an accounting footnote - it's nearly 1.5x the entire consideration paid for the incremental Glovo stake in July, meaning the market or the business itself moved against the deal faster than Delivery Hero's own deal team modeled. Before the next acquisition of this scale, Delivery Hero needs either a materially more conservative purchase price or a much longer post-closing monitoring window before booking goodwill as durable.
Key Financial Metrics
FY2022 vs. FY2021, reported in EUR (FY2022 also shown in USD); FY2021 restated for correction of errors, see Beyond the Usual
FX: EUR 1 = USD 1.0661 (December 30, 2022 close).
| Metric | FY2022 (EUR) | FY2022 (USD) | FY2021 (EUR, restated) | YoY |
|---|---|---|---|---|
| Revenue | €8,577.3M | ~$9,145.0M | €5,855.6M | ✅ +46.5% |
| Total Segment Revenue» | €9,418.8M | ~$10,043.3M | €6,389.8M | ✅ +47.4% |
| Gross profit | €2,231.8M | ~$2,379.2M | €1,258.0M | ✅ +77.4%, margin 26.0% vs 21.5% |
| Adjusted EBITDA» of the Segments | -€467.2M | ~-$498.1M | -€795.6M | ✅ loss narrowed 41.3% |
| Operating result | -€2,276.2M | ~-$2,426.7M | -€1,079.4M | ⚠️ loss widened >100% |
| Net result | -€2,975.1M | ~-$3,171.4M | -€1,120.7M | ⚠️ loss widened >100% |
| Diluted/basic EPS | -€11.21 | — | -€4.57 | ⚠️ widened >100% |
| Cash flow from operating activities | -€688.8M | ~-$734.4M | -€901.4M | ✅ outflow narrowed 23.6% |
| Cash and cash equivalents (period-end) | €2,417.8M | ~$2,299.4M | €2,448.3M | Roughly flat, -1.2% |
| Balance sheet | Dec 31, 2022 | Dec 31, 2021 (restated) | Change |
|---|---|---|---|
| Total assets | €12,860.2M | €12,656.5M | ✅ +1.6% |
| Total equity | €3,792.1M | €5,443.8M | ⚠️ -30.3% |
| Non-current liabilities | €6,665.8M | €5,458.1M | ⚠️ +22.1% |
| Current liabilities | €2,402.3M | €1,754.7M | ⚠️ +36.9% |
This is the widest divergence between adjusted and GAAP profitability tracked on this site across all four Delivery Hero periods covered so far: Adjusted EBITDA of the Segments improved 41.3% while the operating loss and net loss both more than doubled. Nearly all of that gap is the €742.5 million goodwill impairment (see Beyond the Usual) plus a further deterioration in the "other financial result" line (-€257.2 million in 2022, versus a positive €420.6 million in 2021 - a swing of nearly €678 million driven mostly by the absence of the large fair-value gains that flattered FY2021's net result, not a new loss item). Operating cash flow, the one number that improved on both an adjusted and unadjusted basis, is arguably the most trustworthy single line in this report - a genuine 23.6% narrowing of cash burn, consistent with the underlying platform's improving unit economics.
The core platform business, excluding Glovo, generated a positive Adjusted EBITDA for the first time in Delivery Hero's public history this year - a real milestone. The headline net loss more than doubled anyway, because a single acquisition's goodwill got written down by an amount larger than most of what was paid for it five months earlier.
Key Operational Metrics
Actual reported figures; order counts remain undisclosed as a KPI, see the H1 2022 post
| Metric | FY2022 | FY2021 | YoY |
|---|---|---|---|
| GMV» | €42,826.8M | €32,518.9M | ✅ +31.7% |
| Adjusted EBITDA/GMV margin | -1.1% | -2.4% | ✅ improved |
| Own-delivery Dmarts (period-end) | 1,126 | 1,074 | ✅ +4.8% |
GMV growth of 31.7% is meaningfully slower than the >50% rates seen in FY2021 and H1 2022, reflecting both the natural deceleration as Woowa fully laps its acquisition anniversary and a genuinely tougher macro environment across most markets in 2022 (higher inflation, tighter consumer spending). Delivery Hero has still not restored order counts as a disclosed KPI - the shift away from tracking orders, flagged in the H1 2022 post, persisted through the full year.
Segment Results
FY2022, five reportable segments: four geographic regions plus Integrated Verticals. Europe now includes Glovo from July 2022
| Segment | Revenue (FY22) | YoY | Adj. EBITDA (FY22) | Adj. EBITDA margin | FY21 margin |
|---|---|---|---|---|---|
| Asia | €3,803.6M | ✅ +31.3% | €57.0M | +0.2% | -2.0% |
| MENA | €2,218.4M | ✅ +41.9% | €130.8M | +1.5% | +1.6% |
| Europe (incl. Glovo from Jul'22) | €980.5M | ✅ +71.6% | -€158.5M | -3.3% | -1.3% |
| Americas | €681.6M | ✅ +33.8% | -€132.8M | -5.1% | -8.0% |
| Integrated Verticals | €1,734.7M | ✅ +76.1% | -€363.5M | -19.5% | -27.3% |
Asia swung to a positive Adjusted EBITDA for the first time tracked on this site - a genuinely notable milestone for the segment that carried the largest absolute loss of any region as recently as FY2021 (-€421.6 million). The turnaround came from Woowa's continued maturation, the wind-down of the loss-making Japanese operation (ceased January 2022), and marketing-spend efficiency in the foodpanda APAC business. MENA remained modestly profitable and essentially flat as a percentage of revenue (1.5% versus 1.6%), continuing to stabilize after the multi-year margin erosion tracked since FY2017. Europe is the one segment to get materially worse, its margin widening from -1.3% to -3.3% - almost entirely a Glovo effect: excluding Glovo, the underlying Europe segment's Adjusted EBITDA actually improved 46.5% to -€18.7 million and turned positive in Q3 and Q4 2022 on a standalone basis. In other words, the newly-acquired Glovo business is currently dragging down a European platform segment that was otherwise recovering well on its own - the clearest segment-level evidence yet of the acquisition's mixed near-term impact flagged in the goodwill-impairment finding below. Americas and Integrated Verticals both continued the steady margin improvement seen through H1 2022.
Beyond the Usual
A €742.5 million goodwill impairment, most of it tied to an acquisition closed the same year
Delivery Hero recognized goodwill impairment losses of €742.5 million in 2022's "other operating expenses," allocated across the cash-generating units of Glovo, Glovo Dmart, Latin America Dmarts, InstaShop, Turkey (Yemeksepeti), and Honest Food. Glovo itself only closed July 4, 2022 - meaning a material share of this impairment reflects a reassessment of a deal's value within the same financial year it was completed. This is a much larger and more concentrated writedown than the €85.9 million InstaShop impairment flagged the prior year in the FY2021 post, and it directly explains why Europe's segment margin (see above) got worse even as the underlying ex-Glovo business improved.
Delivery Hero wrote down €742.5 million of goodwill in the same year it closed the Glovo acquisition - a sum larger than the €509.5 million paid for the incremental Glovo stake in July. Whatever due diligence supported that purchase price didn't survive six months of actual ownership.
The Dubai arbitration this site has tracked since 2021 produced a partial ruling - against Delivery Hero's subsidiary
The Dubai arbitration first disclosed in the FY2021 post (a minority shareholder's 2019 claim over a forced-buyout attempt) reached a partial award in September 2022, and the arbitral tribunal ruled that the wholly-owned Delivery Hero subsidiary breached its contractual and legal obligations toward the minority shareholder and unfairly prejudiced them. The tribunal has not yet decided the specific monetary relief - that comes in a later, final award - so no reliable liability estimate exists yet, and Delivery Hero's own risk assessment "remains unchanged" as of this report despite the adverse partial ruling. This is a genuine escalation from the "not probable" framing this site has covered in every prior period on this dispute: an arbitral tribunal has now actually found against the company on liability, with only the size of the damages left open.
The Dubai arbitral tribunal ruled against a Delivery Hero subsidiary on liability in September 2022 - the company's disclosed risk assessment hasn't changed, but this is the first period in which an actual adjudicator, rather than Delivery Hero's own counsel, has found against the company in this multi-year dispute. The size of the eventual damages award remains unknown.
Two more competition-authority investigations surfaced, on top of the EU dawn raid already disclosed
Beyond the European Commission's market-sharing inspection flagged in the H1 2022 post, this report discloses that since 2019 two Group subsidiaries have separately been investigated by a competition authority over exclusivity clauses and loyalty rebates (with fines recommended and now under administrative appeal), and that since 2021-2022 two further subsidiaries have been under investigation for vertical restraints. None of these has a quantified provision - Delivery Hero says it believes it has "a good chance of success" contesting the exclusivity/loyalty-rebate finding - but the running tally of live competition-law matters across this site's coverage of Delivery Hero is now: one EU Commission dawn raid, one exclusivity/rebate finding under appeal, and two ongoing vertical-restraint investigations, alongside the still-unresolved Dubai arbitration and a competitor's pricing-clause lawsuit first flagged in FY2021.
Delivery Hero now has five separate live legal or regulatory disputes disclosed across its last two annual reports - an EU antitrust inspection, a contested competition-authority fine, two newer antitrust investigations, and a partially-lost arbitration. None is individually large enough to threaten the company, but the cumulative pattern across markets is worth tracking as its own category of risk.
Delivery Hero fully exited its Zomato stake, closing out a position this site has followed since FY2021's fair-value gains
Delivery Hero sold its entire remaining Zomato stake (1.36%, down from a much larger original position) in July 2022 for roughly €60 million net proceeds - closing out a position whose paper gains helped flatter FY2021's net result by €115.6 million. This is a clean, disclosed divestment with no red flags attached; it's included here because it's the last chapter of a cross-holding this site has tracked since it first appeared as a source of financial-result volatility.
A new transfer-pricing model, adopted at the start of 2023, hints at unresolved historical tax exposure
Delivery Hero disclosed it completed a comprehensive review of its global transfer-pricing model during 2022, implementing an updated model effective January 1, 2023. The report notes plainly that "it cannot be ruled out that local tax authorities may claim to apply the updated transfer pricing model also for the past" - language that suggests the company itself sees some retroactive exposure risk from whatever the prior model got wrong, even as it says it has taken "appropriate measures and precautions" to counter potential arguments from local tax authorities. No provision is quantified.
Target Valuation Range
Implied enterprise value of ~€14 billion (~$14.9 billion), roughly 1.5x FY2022 Total Segment Revenue - fairly valued to slightly undervalued at that level, if the ex-Glovo platform profitability improvement (Asia turning EBITDA-positive, the broader platform hitting a positive Adjusted EBITDA excluding Glovo) proves durable - but that's a real "if," given the goodwill impairment shows management's own read on parts of the portfolio changed within months of paying for it.
Delivery Hero's share price closed FY2022 at €44.78 (December 30, 2022), up 25.2% from the €35.77 close at the end of H1 2022 covered in the prior post but still down 54.3% from the €98.00 close at the end of FY2021. With a weighted-average diluted share count of 266.8 million shares for the full year (as disclosed in the earnings-per-share note), and roughly 257.3 million shares actually outstanding at year-end (registered capital of 265,086,455 shares less 7,794,307 treasury shares), and total debt (convertible bonds plus the syndicated term loan drawn in April 2022, partially bought back later in the year - Delivery Hero repurchased €104.3 million of its 2024 convertible bonds during H2) remaining well above cash on hand, continuing the net-debt position first flagged in the H1 2022 post:
| Market cap → enterprise value | FY2022 |
|---|---|
| Share price (period-end) | €44.78 |
| Shares outstanding | ~257.3M |
| Market capitalization | ~€11.5B (~$12.3B) |
| Total liabilities (convertible bonds + syndicated term loan) | above cash on hand (net-debt position) |
| Less: cash and equivalents | (net-debt position) |
| Enterprise value | ~€14B (~$14.9B) |
| Peer-multiple sanity check | H1 2022 | FY2022 | Change |
|---|---|---|---|
| Enterprise value | ~€12B | ~€14B | ⚠️ up |
| EV/Total Segment Revenue | ~1.4x (annualized) | ~1.5x | - roughly flat, the market's re-rating largely stabilized this half rather than continuing to compress |
| EV/GMV | ~0.3x (annualized) | ~0.33x | - roughly flat, not a further deterioration |
No directly comparable food-delivery peer has been covered on this site with a completed post yet, so a peer-multiple sanity check against another public delivery marketplace isn't possible this period.
A real DCF is still not attempted here, but for the first time across this site's four Delivery Hero posts, the reason is closer to "not yet enough post-Glovo history" than "the losses are too large to project." The ex-Glovo platform Adjusted EBITDA turning positive this year is a genuine, trackable signal - if it holds for another 2-3 periods and Glovo's own goodwill-impaired business stabilizes, a real discounted-cash-flow model becomes defensible in a way it wasn't in either prior post. Revisit at that point rather than forcing a number now.
The core delivery business finally made money on an adjusted basis this year - the most durable-looking result in five years of Delivery Hero reports covered on this site. It happened in the same twelve months the company had to admit that a large chunk of what it paid for Glovo was already gone, and that an arbitrator in Dubai thinks it broke a contract. Both are true, and neither cancels the other out.
Delivery Hero SE's Annual Report 2022 (audited consolidated financial statements and combined management report for the financial year ended December 31, 2022, authorized by the Management Board April 26, 2023), via Delivery Hero's investor relations page.