DHER Delivery Hero Just Hit Adjusted EBITDA Breakeven. So Why Is the Stock Down 64% in Two Years?

Breakeven Arrives, But It's Not the Whole Story

Five years after its IPO and five straight half-years of losses recorded on this site, Delivery Hero's first half of 2023 contains a number the company has never reported before: Adjusted EBITDA of the segments turned positive - €9.2 million, versus a €323.0 million loss a year earlier. Group Merchandise Value^» (GMV) grew 11.3% to €22.3 billion, but Total Segment Revenue - the top-line figure before voucher deductions - grew almost twice as fast at 21.3% to €5,075.6 million, a sign the business is extracting more revenue per euro of order value rather than just running bigger. That's the headline Delivery Hero wants read, and it's real: the Platform segments (everything except the owned-warehouse "Dmart" business) posted a combined positive Adjusted EBITDA of €133.5 million, a genuine milestone after six years of continuous segment-level losses.

None of that shows up in the bottom line. Net result was a loss of €832.3 million, narrower than the €1,495.8 million loss a year earlier but still enormous relative to the operating improvement - the gap is financing costs (a widening "other financial result" from fair-value losses on investments and foreign-currency translation, more on this below) and a corporate structure still absorbing over €1 billion in half-yearly charges that have nothing to do with delivering food. And the market has been unimpressed by the operating story regardless: DHER shares closed at €40.40 on June 30, 2023, down 64% from the €111.40 close two years earlier (June 30, 2021) and down from a €55.22 January 2023 high - a stock that's been mostly falling since Delivery Hero's mid-2021 peak, through a period that includes this quarter's genuinely positive operating news. The market isn't rewarding breakeven Adjusted EBITDA; it's still pricing in something else entirely - most likely the balance of leverage, dilution from convertible bonds, and a net loss that keeps landing near €1 billion every half year regardless of the segment-level story (see Target Valuation Range).

The Prescription

Delivery Hero should keep doing exactly what got it to this quarter's breakeven: extracting more revenue per order (advertising, subscriptions, delivery fees) rather than chasing GMV growth for its own sake, and continuing to rationalize the Integrated Verticals (Dmart) footprint toward stores that are actually profitable rather than defending market share everywhere at once. MENA's Adjusted EBITDA/GMV margin improving to 2.4% (from 1.0% a year earlier) and the platform segments' swing to a combined €133.5 million profit both come from the same instinct - charge for value delivered (delivery fees, advertising, subscriptions) instead of subsidizing growth with vouchers - and it's the only lever in this report that's actually working across multiple segments at once.

What it should stop doing is letting "Adjusted EBITDA" carry the entire investor narrative while the real net result keeps landing near a billion-euro loss. The €62.8 million of "management adjustments" and the growing pile of one-time items (goodwill impairments, legal-matter expenses, reorganization costs) stripped out of Adjusted EBITDA aren't going away - they've been a recurring feature of every half-year since the IPO, and a genuinely convincing turnaround narrative needs the unadjusted numbers to start converging with the adjusted ones, not just the adjusted number crossing zero once.

Key Financial Metrics

H1 2023 vs. H1 2022 (restated), reported in EUR (H1 2023 also shown in USD)

FX: EUR 1 = USD 1.0868 (June 29, 2023 month-end close, the last trading day of the period).

Delivery Hero's own H1 2022 comparatives in this report are restated from what was originally published a year ago: during preparation of the 2022 annual accounts, the company found an error in how it accounted for its share of Glovo's losses (Glovo was then an equity-method investment, before full consolidation in July 2022), understating the loss. The correction moved H1 2022's net result from -€1,467.3 million (as originally reported) to -€1,495.8 million (restated, used below) - a €28.5 million swing with no cash impact, but still a real correction to a number this site already cited in an earlier reporting period.

Metric	H1 2023 (EUR)	H1 2023 (USD)	H1 2022 (restated)	YoY
Total Segment Revenue	€5,075.6M	~$5,515.2M	€4,185.7M	✅ +21.3%
Revenue (net of vouchers)	€4,839.0M	~$5,258.7M	€3,815.4M	✅ +26.8%
Adjusted EBITDA (segments)	€9.2M	~$10.0M	-€323.0M	✅ first-ever positive half
Operating result (EBIT)	-€461.2M	~-$501.1M	-€1,041.0M	✅ loss narrowed 55.7%
Net result	-€832.3M	~-$904.5M	-€1,495.8M	✅ loss narrowed 44.4%
Diluted/basic EPS	-€3.04	—	-€5.75	✅ loss narrowed
Operating cash flow	-€177.2M	~-$192.6M	-€401.9M	✅ outflow narrowed 55.9%
Free cash flow (proxy: OCF less capex)*	-€289.9M	~-$315.1M	-€538.7M	✅ outflow narrowed
Cash and cash equivalents (period-end)	€1,924.1M	~$2,091.1M	€2,936.2M	⚠️ -34.5% (bond buybacks, M&A)

*Free cash flow^» isn't a metric Delivery Hero defines; the figure above is operating cash flow less capex (property/plant €62.8M and intangibles €49.9M in H1 2023; €99.8M and €37.0M in H1 2022).

Balance sheet	Jun 30, 2023	Dec 31, 2022	Change
Total assets	€11,684.5M	€12,860.2M	⚠️ -9.1%
Total equity	€3,035.2M	€3,773.7M	⚠️ -19.6%
Total liabilities	€8,649.3M	€9,086.5M	-4.8%

The Adjusted EBITDA improvement (+€332.2 million) and the operating-result improvement (+€579.8 million) both moved in the right direction, but the net-result improvement (+€663.5 million) came disproportionately from softer non-operating items - a smaller equity-method loss (Glovo's own losses no longer flow through this line, since Glovo has been fully consolidated since July 2022) and a €61.0 million gain on a convertible-bond buyback - rather than purely from the operating business. Cash fell by more than a quarter even after this quarter's improved operating cash flow, driven by the €276.8 million buyout of Hungerstation's remaining 37% minority stake and roughly €676 million spent buying back the Company's own Convertible Bonds I and II (funded by a new €1 billion Convertible Bonds IV issuance in February 2023, see Beyond the Usual).

Adjusted EBITDA crossed zero for the first time, and the operating loss narrowed by more than half - real, structural progress. But net cash fell by over €490 million and the balance sheet added debt through a new €1 billion convertible bond, so the improvement in reported profitability didn't yet translate into a business generating cash for itself.

Key Operational Metrics

Take-rate is derived (Total Segment Revenue ÷ GMV), not separately disclosed

Metric	H1 2023	H1 2022	YoY
GMV	€22,282.7M	€20,023.6M	✅ +11.3%
Implied take-rate (Total Segment Revenue ÷ GMV)	22.8%	20.9%	✅ improved
Employees (period-end)	47,208	51,118 (Dec 2022)	Headcount fell 7.6% since year-end
Dmart stores (period-end)	982 in 58 countries	1,125 (Jun 2022)	⚠️ store count fell

Glovo's full consolidation from July 2022 makes the H1 2023 vs. H1 2022 comparison partly inorganic - Delivery Hero itself discloses that, excluding Glovo, Total Segment Revenue growth would have been roughly 11.4% (versus the reported 21.3%) and GMV growth roughly 2.2% (versus the reported 11.3%). The headline growth rate is real revenue and real order volume, but a large chunk of it is Glovo showing up in the consolidated numbers for the first time rather than existing operations accelerating.

Segment Results

H1 2023, five reportable segments: four regional (Asia, MENA, Europe, Americas) plus Integrated Verticals (own-warehouse Dmarts)

Segment	Revenue (H1'23)	YoY	Adj. EBITDA (H1'23)	Adj. EBITDA/GMV	H1'22 margin
Asia	€1,831.4M	⚠️ -1.8%	€173.7M	+1.4%	-0.6%
MENA	€1,234.4M	✅ +22.7%	€111.5M	+2.4%	+1.0%
Europe	€729.5M	✅ >100%	-€98.3M	-2.7%	-1.4%
Americas	€372.4M	✅ +13.8%	-€53.4M	-3.7%	-6.5%
Integrated Verticals	€1,019.1M	✅ +32.2%	-€124.3M	-11.6%	-21.5%

Asia is the segment worth watching most closely: it's the only region where revenue shrank year-over-year (-1.8%), driven by post-pandemic order-frequency normalization in Taiwan, Malaysia and Hong Kong plus a reopening effect in Korea - yet it swung from a €80.5 million loss to a €173.7 million profit, the single largest driver of the whole Group's Adjusted EBITDA turnaround. That's a genuinely unusual combination: a shrinking top line generating the company's best margin improvement, on the back of stronger own-delivery unit economics and cost discipline rather than growth. Europe is the opposite story - revenue tripled (largely Glovo's first full-consolidation half) while the segment's loss also widened (-€98.3 million from -€20.3 million), because Glovo itself still runs at a loss and its full weight now shows up here for the first time. MENA kept improving steadily (margin up to 2.4% from 1.0%), continuing to recover from the multi-quarter slide flagged in the 2018 H1 post, though it's still well below the 24.8% margin MENA posted back in H1 2017.

Beyond the Usual

A €28.5 million retroactive correction to last year's own comparative

During preparation of its 2022 annual accounts, Delivery Hero discovered that its share of Glovo's losses (recognized through the equity method before Glovo's July 2022 full consolidation) had been understated due to missing provisions in Glovo's own financial statements. The correction restated H1 2022's net result from -€1,467.3 million to -€1,495.8 million and basic/diluted EPS from -€5.64 to -€5.75 - a real change to a number Delivery Hero had already published and that this site's own H1 2022-period comparisons elsewhere rely on being accurate. The error originated inside Glovo's own books, not Delivery Hero's, and had zero cash impact, but it's the kind of restatement worth tracking given Delivery Hero's history of adjusting how prior periods are presented (see the like-for-like and IFRS 15 changes flagged in the 2018 H1 post).

Delivery Hero restated its own H1 2022 net loss by €28.5 million this half, due to an error inside Glovo's financial statements that predates Glovo's full consolidation - a legitimate correction, but the second consecutive reporting period in this company's history where a previously published comparative number needed to be revised.

Spain quantifies a €200-400 million courier-classification exposure; Argentina surfaces as a smaller, separate one

During H1 2023, Spanish authorities opened an investigation into the business model Glovo has operated in Spain since August 2021, examining whether its couriers should be reclassified as employees rather than self-employed freelancers - and Delivery Hero already puts a range on it in this report: if reclassification goes through, the Group could face social-security, late-payment, fine, and VAT claims in Spain "in an overall range between approx. €200 million and €400 million." No provision has been recognized against that range, since reclassification isn't assessed as probable. Separately, a newly-disclosed Argentine investigation into courier classification is sized much smaller - potential exposure "expected to be below €10 million." Separately, new Spanish and Portuguese legislation (effective February and March 2023) tightened the procedural and substantive tests used to classify platform workers. The following annual report narrows and raises the Spain range to €260-430 million, tied specifically to the business model run since August 2021 - a widening exposure on the same underlying issue, not a first-time quantification.

Delivery Hero already puts a €200-400 million range on its Spanish courier-classification exposure this half, plus a smaller sub-€10 million Argentine exposure - live regulatory risk that's being quantified and, per the next annual report, keeps growing.

A €1 billion convertible bond funded a buyback of the two it's replacing

Delivery Hero issued €1.0 billion of new Convertible Bonds IV in February 2023 (maturing 2030, 3.25% coupon, initial conversion price €57.75 - a 40% premium to the reference price) and used part of the proceeds to buy back €476.4 million face value of Convertible Bonds I (maturing 2024) and €250.0 million of Convertible Bonds II (maturing 2025), recognizing a €61.0 million gain on the buyback. Economically, this pushes debt maturities further out (from 2024/2025 into 2030) at a lower headline coupon than the bonds retired, but it also adds roughly €274 million of net new principal to the balance sheet during a half when equity fell by over €700 million - leverage is being extended and refinanced, not reduced.

The Woowa (Korean subsidiary) non-controlling-interest put liability fell by €250 million after Woowa's own management exercised options to transfer their remaining shares to Delivery Hero in March 2023 - a mechanical settlement of an instrument flagged in earlier posts, not a new development, but it explains a meaningful chunk of this half's balance-sheet movement on its own.

A related-party loan to a Colombian joint venture, quietly carrying a bad-debt provision

Delivery Hero discloses a credit facility extended to Inversiones CMR S.A.S., a Colombian joint venture, at an interest rate of Libor + 4.17% expiring in July 2024. The note doesn't disclose the loan's size or provisioning status in this half-year report, but by the FY2023 annual report, the same receivable is disclosed as having been fully written off. A related-party loan to a joint venture quietly heading toward a full write-off, disclosed only in a single sentence each period, is exactly the kind of footnote detail easy to miss without reading consecutive reports side by side.

The Dubai arbitration finally closed, on terms unfavorable to the minority shareholder

The May 2019 Dubai arbitration proceeding (a minority shareholder in a local Group company seeking damages for unfair prejudice after Delivery Hero attempted to exercise a call option) reached its final award in May 2023: Delivery Hero was required to acquire the entire outstanding non-controlling interest, but on terms that included offsetting the underlying valuation against DH's own counterclaim damages and the minority shareholder's own legal costs. A four-year-old contingent liability closed out this half in a way that ultimately favored Delivery Hero rather than the counterparty.

Target Valuation Range

Implied enterprise value of ~€14.13 billion (~$15.35 billion), roughly 1.4x annualized Total Segment Revenue. Too early to call a clean valuation verdict beyond that multiple-derived figure - Delivery Hero just crossed Adjusted EBITDA breakeven for the first time, meaning the market is still pricing mostly on growth and leverage risk rather than on any meaningful cash-generation multiple.

Delivery Hero SE closed at €40.40 on June 30, 2023. With approximately 269.4 million shares outstanding (subscribed capital of €269.4 million at €1.00 nominal value per share), and net debt at period-end of roughly €3.24 billion (total debt of approximately €5.17 billion across bank borrowings, convertible bonds and a convertible loan, against €1.92 billion of cash):

Market cap → enterprise value	H1 2023
Share price (period-end)	€40.40
Shares outstanding	~269.4M
Market capitalization	~€10.89B (~$11.83B)
Total liabilities (bank borrowings + convertible bonds/loan)	~€5.17B
Less: cash and equivalents	~€1.92B
Enterprise value	~€14.13B (~$15.35B, net debt ~€3.24B)

Peer-multiple sanity check	FY2022	H1 2023	Change
Enterprise value	~€14B	~€14.13B	- flat
EV/Total Segment Revenue	~1.5x	~1.4x (annualized H1 ×2)	✅ down slightly
Adjusted EBITDA multiple	n/a	not meaningful (business at the very edge of breakeven)	-

Peer cross-check: Grab Holdings, a comparable on-demand delivery-and-mobility platform, posted a Deliveries-segment Adjusted EBITDA margin of 2.7% of GMV in the same quarter - ahead of Delivery Hero's Group-wide 0.0% margin this half, though Grab's Deliveries-only figure isn't a fully apples-to-apples comparison against Delivery Hero's blended Group number.

A DCF isn't attempted this quarter: Delivery Hero's free cash flow is still negative (-€289.9 million this half on the proxy measure above), and a company at the very first inflection point of Adjusted EBITDA breakeven doesn't yet have a cash-flow trajectory stable enough to project a multi-year forecast from with any real confidence. A reverse DCF is similarly not attempted - the near-zero current-period cash flow makes "what growth rate is priced in" an unstable calculation likely to produce a number that looks precise but isn't meaningful.

Delivery Hero's stock has fallen from a €111.40 close on June 30, 2021 to €40.40 two years later - down 63.7% - despite Total Segment Revenue more than doubling and the company crossing Adjusted EBITDA breakeven over the same period. The stock did rally from its October 2022 low (€33.35) to a €55.22 January 2023 high before falling back to €40.40 by this period's end, a round trip that suggests the market's read on the turnaround narrative has been more volatile than the underlying numbers. Delivery Hero has not split its stock since its 2017 IPO, so these are actual nominal prices, not retroactively adjusted figures.

Adjusted EBITDA crossing zero is real progress, and it's the number Delivery Hero wants investors focused on. But the market capitalization has fallen by nearly two-thirds over the same two years the company took to get there - whatever story justified a €111 share price in mid-2021 clearly wasn't "eventual Adjusted EBITDA breakeven," and that gap between the metric management controls and the metric the market has actually priced is the real story of this half.

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