Delivery Hero's Q2 Performance and Currency-Driven Guidance Cut: A Strategic Investment Assessment

Delivery Hero’s Q2 2025 results present a paradox: robust operational growth juxtaposed with a revised profit outlook. The company reported a 71% year-over-year surge in adjusted EBITDA for the first half of 2025, reaching €411 million, driven by a 27% increase in Total Segment Revenue to €3.7 billion [1]. This growth was fueled by strategic investments in Asia, where the region contributed €5.18 billion (42.4% of global GMV) and €1.11 billion (30% of Total Segment Revenue) in Q2 [2]. However, the company slashed its full-year adjusted EBITDA guidance from €975–€1,025 million to €900–€940 million, citing €110 million in foreign exchange (FX) headwinds—primarily from a stronger euro against the South Korean won and U.S. dollar-pegged currencies [3].

The FX drag is not merely a short-term blip but a structural challenge. Asia, which accounts for over one-third of Delivery Hero’s global sales, has seen GMV decline sequentially from -7% in Q1 to -2% in Q2 [4]. While South Korea showed “clear improvements” through subscription programs and AI-driven logistics [5], the broader region remains vulnerable to currency volatility. For instance, the euro’s strength against the won alone cost the company €80 million in Free Cash Flow [6]. This raises a critical question: Can Delivery Hero’s operational momentum in Asia offset these FX-driven losses?

The answer lies in the company’s strategic resilience. Delivery Hero has exited underperforming markets like Thailand and Denmark to focus on high-growth regions [7]. In South Korea, its acquisition of Woowa and expansion of its own delivery network have improved margins and customer retention [8]. Additionally, the company’s geographic diversification—spanning 70+ markets—acts as a natural hedge, balancing losses in one region with gains in another [9]. For example, strong performance in the Middle East and Europe partially offset FX pressures in Asia [10].

Yet, the long-term outlook hinges on margin sustainability. Delivery Hero’s adjusted EBITDA margin expanded 70 basis points to 1.7% of GMV in H1 2025 [1]. However, FX headwinds could erode this progress. The company’s cash reserves (€2.8 billion) provide flexibility to invest in innovation, such as drone-based deliveries in South Korea, which could reduce operational costs [11]. Still, investors must weigh the risk of prolonged currency volatility against the potential for margin expansion in Asia.

For now, Delivery Hero’s strategic pivot to high-growth markets and disciplined cost management suggests a path to offsetting FX headwinds. While the guidance cut is concerning, the company’s ability to generate strong EBITDA growth and adapt to regional challenges—such as exiting unprofitable markets—demonstrates operational agility. The key will be whether its Asian investments, particularly in South Korea, can scale profitably enough to absorb currency-driven losses.

Source:
[1] Q2 and H1 2025 financial results [https://www.deliveryhero.com/newsroom/q2-and-h1-2025-financial-results-delivery-hero-accelerates-growth-and-expands-profitability-updates-full-year-guidance/]
[2] Delivery Hero logs Q2 growth, but trims earnings guidance [https://finance.yahoo.com/news/delivery-hero-logs-q2-growth-102701101.html]
[3] Delivery Hero Revises 2025 Guidance To Reflect Foreign Exchange Rate Headwinds [https://www.rttnews.com/3569657/delivery-hero-revises-2025-guidance-to-reflect-foreign-exchange-rate-headwinds.aspx]
[4] Delivery Hero accelerates growth and expands profitability [https://ayondo.com/en/news/DE000A2E4K43/delivery-hero-se/delivery-hero-accelerates-growth-and-expands-profitability-updates-full-year-guidance-2189782]
[5] Delivery Hero: Navigating FX Headwinds and Building a Resilient Delivery Empire [https://www.ainvest.com/news/delivery-hero-navigating-fx-headwinds-building-resilient-delivery-empire-2508]
[6] Delivery Hero Revises 2025 Guidance To Reflect Foreign Exchange Rate Headwinds [https://www.rttnews.com/3569657/delivery-hero-revises-2025-guidance-to-reflect-foreign-exchange-rate-headwinds.aspx]
[7] Delivery Hero: Navigating FX Headwinds and Building a Resilient Delivery Empire [https://www.ainvest.com/news/delivery-hero-navigating-fx-headwinds-building-resilient-delivery-empire-2508]
[8] Delivery Hero reports Q2 revenue growth slightly above [https://sg.finance.yahoo.com/news/delivery-hero-reports-q2-revenue-054733737.html]
[9] Delivery Hero: Navigating FX Headwinds and Building a Resilient Delivery Empire [https://www.ainvest.com/news/delivery-hero-navigating-fx-headwinds-building-resilient-delivery-empire-2508]
[10] Delivery Hero Trims 2025 Profit Outlook Despite Q2, H1 [https://finance.yahoo.com/news/delivery-hero-trims-2025-profit-211944456.html]
[11] Delivery Hero: Navigating FX Headwinds and Building a Resilient Delivery Empire [https://www.ainvest.com/news/delivery-hero-navigating-fx-headwinds-building-resilient-delivery-empire-2508]