Zoomcar reports 54% contribution profit in Q2 2024

Indian car-sharing marketplace Zoomcar Holdings, today announced that its contribution profit reached an all-time high of $1.21 million in the quarter ended September 2024, representing 54% of revenue. This marks a recovery from a loss of $0.12 million in the same quarter last year and shows significant growth from the previous quarter's profit of $0.46 million. The company said focus on customer experience has caused this turnaround.

In a statement to investors, Zoomcar CEO Hiroshi Nishijima emphasised the company's strategic focus on customer experience. Nishijima said, "By making customer experience our top priority, we've been able to organically boost guest repeat bookings and improve host retention. This focus has allowed us to optimize costs, particularly in marketing spend, cash incentives, and discounts, driving a significant improvement in our contribution profit."

The company's aggressive cost-cutting measures resulted in an 81% reduction in marketing expenses, a 55% decrease in repair and maintenance costs, and a 52% reduction in technology-related expenditure compared to the same quarter last year.

Customer satisfaction metrics showed notable improvement, with average guest trip ratings climbing from 4.16 out of 5 in March 2024 to 4.63 by the end of September 2024. The platform has also seen a 6% increase in high-quality active cars, rising from 5,516 to 5,830 vehicles, all maintaining an average rating above 4.5 out of 5.

Booking numbers saw a 7% increase from 97,970 in the previous quarter to 105,160 in Q2 2024. This growth has been primarily attributed to a 1.5-times increase in guest repeat booking rates.

The company's net loss per share has shown dramatic improvement, dropping to $4.43 from $2,568.82 in the same quarter last year. Additionally, adjusted EBITDA loss has been significantly reduced to $1.47 million, compared to $3.87 million in the corresponding period last year.

Zoomcar, established as India's leading car-sharing marketplace, has been working to achieve profitability in the mobility sector. The company went public on Nasdaq and has been implementing strategic initiatives to improve operational efficiency and customer experience.

The company has scheduled its Q2 2024 Earnings Call for 14 November 2024, at 10:00 AM Eastern Time, where management will provide further details about the quarter's performance and future strategies.