Delivery Hero Aktie

Welcome to the Delivery Hero Q1 2026 Trading Update. Today's presentation will be followed by a Q&A session. [Operator Instructions] I will now hand over to Andrea Ferraz Estrada to begin the presentation.

Hello, and welcome, everyone, to our Q1 2026 earnings call. I'm joined today by Niklas Oestberg, our CEO; and Marie-Anne Popp, our CFO. Together, they will present the key highlights of our Q1 2026 results. Following their presentation, they will be delighted to address any questions you might have.

One reminder before we begin. Talabat will release its own Q1 results on the 12th of May. As a separately listed company, Talabat is bound by its own disclosure obligations, so we won't be able to comment on its specific financials today. We kindly ask that you direct any Talabat-specific questions to its results call. And now over to you, Niklas.

Thank you, Andrea, and welcome, everyone, also from my side, and thank you for joining us today.

We have 3 key messages for you. First, growth is accelerating. Group GMV grew 8.8% like-for-like in Q1, up from 7.9% in Q4. Quick commerce now at 18% of GMV grew 30%. As the number of consumers engaging in quick commerce increases, overall growth accelerates.

The result of this Everyday app strategy is visible in our group numbers, but also in countries like Saudi Arabia, where we have been seeing an acceleration in growth since the end of last year.

Second, profitability is on track. The investments we've made in recent months are supporting higher profitable growth, which makes us confident in our ability to achieve adjusted EBITDA in the upper end of our EUR 910 million to EUR 960 million range with free cash flow comfortably above EUR 200 million for 2026.

Finally, our strategic review remains our top priority. We've agreed to the sale of Taiwan for USD 600 million, and we are on track to close that transaction in H2. More work streams concerning the strategic review are ongoing, including asset evaluations and operational efficiencies.

In the meantime, we would like to share an update on our Everyday app strategy. This is the framework that guides us every single day. We've built one of the most capable delivery platform in the world with 1.5 million vendors, 60 million monthly active users and over 80 fulfillment centers. Our goal is to continue our transformation from restaurant delivery into an Everyday App.

We are evolving our platform to be the first point of contact for consumers' daily needs, spanning not just for food and groceries, but household essentials, health and beauty as well as electronics and lifestyle goods. The Everyday app is a habitual, high-frequency platform that consumers reach for every day, and that is the long-term strategy.

As we shared at our full year release, our priorities for 2026 are clear and Q1 demonstrates that we are executing against each one. We're strengthening our leadership position. You can see that, for example, in the performance of Saudi Arabia in which we're now starting to see category share increasing 1.5 years after a new competitor entered the market with deep discounts.

Secondly, our quick commerce expansion. We are now at 18% share of GMV, delivering growth of 30% at an increasing large scale.

Thirdly, we are accelerating our AI initiatives, automating 85% of first-line service contract contacts, rolling out AI agents for sales and support, launching conversational ordering. Internally, our engineers are integrating AI agents and tooling to maximize development efficiencies.

But let me start with the strategic review. The strategic review is the top priority of the Supervisory Board, for the Management Board and for me personally. I really believe that the Everyday app road map has transformative potential and the strategic review helps us unlock it.

Three things we want to achieve with the strategic review are: one, we want to go deeper, not broader. We want to operate a tighter geographic footprint where the playbook works and build a stronger comparative moat there. Two, we are sharpening our focus in geographies where we lead and delivering the best customer experience across many verticals there. This will translate into more growth, higher margins and consequently higher cash flows per share. Three, strengthening the balance sheet and optimizing our capital structure.

To get there, we have engaged advisers to evaluate specific assets. And in parallel, we are working on operational efficiencies, organizational improvements and a capital allocation framework. This is how we compound strong operational performance into long-term shareholder value. We intend to share an update with you on this by early June.

Let's continue with our platform update. Today, we believe to have the strongest tech platform globally. Except Korea, it operates as one unified platform with unique localization capabilities for each brand. This gives us the best setup for operational leverage and localization.

Some examples, our tech stack has transitioned into an Everyday App that is yielding significant results with 55% of GMV now generated by customers engaging across multiple verticals. We lead in customer experience with 96% of markets where we deliver as fast or faster than our competitors. And we keep getting better and a nice example of that is that we are delivering an 8% reduction in rider waiting times at restaurant and 50% year-on-year growth in priority deliveries.

That engagement converts into loyalty. 43% of our group GMV now comes from subscribers with significant growth still to come. We have further accelerated our development velocity as we have doubled down on AI development. We recently revealed our autonomous AI coding agent, HeroGen, which can handle the entire software development life cycle without human intervention. Engineers and product owners can just describe a feature in natural language and have it deployed in our app end-to-end.

Anthropic has published a case study on it, and Google had us present at their Google Next or Google Cloud Next event last week. It already has an annual coding output equivalent to 130 engineers and is growing double digits per week. We've also built an internal global AI platform, which has added capacity of 108 data scientists. And AI innovation is happening across the company.

The new Gen AI ad ranking model has delivered a 7% increase in return on ad spend as just one example. It's also 30% faster for our data scientists to deploy model changes.

Now let's move to the next slide. Quick commerce is the clearest proof the Everyday app is working with 30% growth in Q1. And critically, it's broad-based. Our strongest regions are growing even faster despite their large scale. That tells you the market is far from saturated. Asia is still only at 7% penetration and the Everyday app is inevitable.

Moving to KSA. In our last set of results, we committed to strengthen our leadership across geographies. We wanted to share our experience in Saudi Arabia, where we have successfully adopted to a new very discount heavy market entrant with limited impact to our business.

As most of you will be aware, a discount-driven competitor entered the Saudi Arabia market for the first time in September 2024. They spent a considerable amount of capital providing their services and the goods practically for free.

Instead of discounting our offering, we focus on building a superior customer experience. We strengthened our subscription program to ensure our value or our best customers would be rewarded for their loyalty. 61% of our GMV now comes from customers who are part of the program.

We improved vendor selection by adding more quick commerce options, our own dark kitchens and ensuring we continue to lead on the restaurant offering by working with vendors to encourage deals on our platform. By doing so, we have significantly strengthened our value proposition. The share of vendor-funded deals has increased by 8 percentage points year-on-year, elevating the affordability for our customers at no additional cost for us.

And lastly, service expansion. We have launched a broad range of services, including group ordering, meal for one, curbside orderings and new loyalty initiatives, all designed to boost consumer engagement. The result is that growth has accelerated since the annualization of Keeta’s market entry and margin impact has been limited.

Furthermore, we have started to gain category share compared to Q4 2025. And also here, one clarification on the Iran conflict. It supported the order development with an extra high single-digit growth in March, but GMV growth in KSA was above 20% also prior to the conflict. The playbook is working independent of external factors and is the primary reason we are so confident in the performance across the group, including Talabat.

Let me now hand over to Marie-Anne, who will guide us through the financial highlights.

Thank you, Niklas, and a warm welcome from my side as well.

We started 2026 with a very robust first quarter, characterized by an acceleration of order growth to 10%, up from 9% in Q4 on a group level. Notably, South Korea returned to positive order and GMV growth in Q1, building on the outstanding fundamental work we've done over the last 2 years. At the same time, momentum across our other segments remain consistently strong.

GMV growth similarly outpaced Q4, reaching 9% compared to the previous 8%. Revenue grew by 18%, exceeding order and GMV growth on the back of the ongoing scaling of our own delivery logistics, particularly in South Korea. Furthermore, our high-margin ad tech business, our attractive subscription programs throughout the group as well as the excellent performance of our Dmarts business contributed to this development.

Let's have a look at the performance on a segment level, starting with MENA. MENA also showed reacceleration relative to Q4. Strong top line performance has been broad-based across HungerStation and Talabat markets with particularly strong growth in quick commerce.

Our efforts to drive engagement through a strong subscription program, targeted offers and broader vendor selection are working. Saudi Arabia is now seeing the highest level of subscriber penetration within the group with subscriptions at 61% of GMV and Talabat is following suit.

Talabat recorded healthy GMV growth throughout January and February. And as the conflict emerged in March, we observed a shift towards elevated eat-at-home consumption and heightened grocery demand. The business also benefited from the timing of the Eid holiday.

It's key to note that the underlying operational trend, however, is backed by strong order growth, thanks to the expanding subscriber base and multi-vertical customers, as mentioned before. We continue to progress on our planned investments in the region. We are monitoring geopolitics closely, keeping a close eye to ensure we're able to react if geopolitical changes lead to a change in performance.

Moving on to Asia. Our largest segment, Asia, is also seeing very positive development. We have completely rebuilt the Korean operating model over the last 2 years and investments have started to pay off. We've seen order growth since year-end '25, and this momentum continued in Q1 '26 and also translated into GMV growth on a like-for-like basis.

Demand in APAC remained resilient as well. And overall, this led to further acceleration of GMV growth in Q1 '26 for the whole Asia segment. We continue to invest in the business, and as such, we drive the further rollout of our own delivery logistics. This has resulted in an increase of the own delivery share for the Asia segment of 12 percentage points to 77%.

The further expansion of the subscription program in Korea is another growth driver. In Q1, 50% of GMV in South Korea could already be attributed to subscribers. Another growth lever in Asia is quick commerce, which demonstrated exponential GMV growth of 27% year-on-year. Special campaigns, growing inventory and expansion of local shops are drivers to get customers on board.

Let's move on to Europe. In Europe, our transition to an employment-based rider model in Spain, which we completed in July 2025, created some transitory headwinds, leading to a temporary moderation in GMV growth for the segment. However, we are already capturing growth gains in Spain, driven by enhanced operational execution and improving the customer experience.

As these operational efficiencies compound and the effect of the change in rider model annualizes, we expect them to translate into accelerated top line growth in H2. Subscription continued to ramp up, and there is significant untapped potential with only 22% of GMV coming from subscribers yet.

Quick commerce reached a record high in active users this March, propelled by optimized vendor selection and increased availability. Our European AdTech business achieved standout performance and posted group-leading 34% revenue growth. This momentum was broad-based across our entire European footprint. Notably, the AdTech integration within Glovo is scaling at a rapid pace, and we see substantial runway for continued expansion.

Now continuing with the Americas business. Order growth accelerated further to 25% in Q1 with 13 out of 15 markets growing above 20% year-over-year. This broad-based momentum is driven by extraordinarily strong growth of 34% year-over-year in our quick commerce business and a compelling subscription offering, which reached 37% of total orders, which strengthened our value proposition across the Americas.

In terms of revenues, we sustained strong momentum this quarter with revenue growth surpassing 20%. Our AdTech business continues to outpace the overall top line, delivering 33% growth and representing substantial upside potential for the future. Alongside this, we are successfully scaling fintech as a complementary engine for long-term growth.

Now on to integrated verticals. We continue to see an excellent trajectory in our integrated verticals business, achieving 28% year-over-year GMV growth. South Korea and the Americas were key contributors here, showing accelerated top line momentum versus the fourth quarter.

It is worth highlighting that with very few new store openings in Q1, this growth was fundamentally organic and driven by higher utilization across our existing fleet. We saw an even more impressive revenue growth of 32%, fueled by strong AdTech performance, which is already contributing annualized Retail Media revenues of over EUR 100 million. Our strategic investment plans for scaling our Dmart footprint remains firmly on track.

Let's now have a closer look at the outlook for 2026. Q1 has started strongly with growth comfortably within the guidance range. While we remain mindful of an uncertain geopolitical backdrop, the solid start to the year and positive results from investments in MENA, Asia and quick commerce make us confident in our ability to deliver adjusted EBITDA in the upper half of the guidance range of EUR 910 million to EUR 960 -- that's it from my side.

Thank you all for joining. We're very excited about the path ahead and appreciate your ongoing support as we build on this quarter's strong results. We're now looking forward to taking your questions. Andrea?

Thank you, Marie-Anne. Operator, please go ahead.

[Operator Instructions] Our first question comes from Andrew Ross with Barclays Capital.

I wanted to follow up on the comment you made in the prepared remarks by Niklas, we might hear more details about the strategic review in early June. Wondering if you can give us a bit more color as to how that update might look? Is it realistic we could be at the point where asset sales are actually announced? Or are we not close enough for that to look likely? And if not, what kind of things might we expect to hear?

And I guess in terms of the timing of it, your AGM is June 23. I think there's a month before that for people to put agenda items onto that AGM. So curious as to the timing of this update in early June and kind of any other messages you have to shareholders into that AGM in general.

Thanks, Andrew. So I think any asset disposal or M&A transaction, we will update as they come. So we will not wait for a review or we will not time it with a review or similar. So I think that should be seen separately.

I think what we want to give a little bit more clarity on is things that we're working on which are potentially outside of asset disposal, which -- yes, all operational improvements, all other strategic decisions that we're taking, that will be the focus. So it will be more the other aspects of it.

So I don't think this should be expected that we are going to announce any asset disposal. That will come when it comes. It's a high priority, but not for this review. We may update on how our thinking around it, but that will be it.

And in terms of AGM, yes, no, it will almost be 6 months. It will be a little bit more than 5 months since we announced the strategic review. We have completed our assessment. We have started to take certain actions. We have, as you know, engaged advisers. We are looking into certain concrete actions, and we want to share a little bit more around that in the strategic review, but it's not connected to AGM.

That's helpful. If I could just clarify one thing on your comments on asset disposals. Are you saying that it's unlikely there will be any asset disposals before early June or just simply that you -- there's no reason to think you'd announce one on that specific date in early June, but we could, in theory, still see one before that?

I cannot comment on timing on any disposals. So I can't either confirm nor contradict that.

Our next question comes from Joe Barnet-Lamb with UBS Limited.

I understand revenues and GMV did a little bit better than expected in 1Q, but obviously, to raise profit guide to the upper end of the range, having only announced that range 35 days ago. I'm keen to understand what's changed. Has there been a shift in required investment levels, maybe in MENA or Korea, a step change in economics somewhere? Just any color you can give as to what's changed over the last 35 days would be fantastic.

Maybe I'll start and then you can chip in, Marie-Anne. So as we announced our full year results, that was roughly 2 months into the year. So effectively 2 months into our investment cycle that we mentioned that we will double down on quick commerce in Middle East and particularly Talabat as well as in Korea.

So we were 2 months into that investment cycle, which means that we only effectively have roughly 1 month of returns. Now we have 2.5 months of returns. So we can see a little bit more what the returns have been. And I think so far, we have seen tremendous -- very good results on the quicker side when we look at acquisitions, frequency. So we have great momentum there.

We have seen very positive results in Korea, continued progress, I should say. And we have seen very good results also in Middle East and in particular, in Talabat, where we already start seeing certain category momentum in our favor despite very recent launches by a discount provider.

So I think we have significantly more data on the returns now versus 1.5 months ago. So that's why we feel confident that we are going to land in the higher end of the range. Yes. I hope that helps a little bit.

No, nothing much to add on my side. I think Niklas captured it really well. I think it's really that the result of that better visibility we have at that point, right, versus where we were a few weeks or a few months ago. And I think in particular, how the growth that we're seeing and that we've seen in the first quarter starts to translate in terms of profitability. So I think that's really how we bring it together and kind of came to the conclusion that we're confident on the upper half of the range.

Our next question comes from Marcus Diebel with JPMorgan.

So very solid results. The question comes, why don't we see now the time for maybe starting a share buyback program? I previously commented that you want to stay conservative on the cash side. But given that we likely end up at the higher end of the EBITDA range, the business continues to go well and there are some potential action on the side, why is that not a good time now to buy back shares?

Marie-Anne, do you want to cover?

Yes, yes, I'll take it. I think as we've also previously discussed when we talked a bit more about capital structure on previous calls, I think for now, it's not a plan that we have. But I think what's really important for us is that we are set up from a capital structure point of view, from a liquidity point of view with a lot of flexibility with a lot of optionality.

You will have seen us buy back convertible bonds in the last few weeks and therefore, address the debt maturities we've had for '26 and '27 to give us basically visibility all the way into 2028. So that's really been the priority to make sure that we are set up in a flexible way and have a number of options available.

So I think I would say the share buyback is one of the tools that we have in our toolkit, and then we very much value having in the toolkit. But for now, we've decided not to activate it yet.

Our next question comes from Xavier Le Mené with BofA Global Research.

Just one actually on Asia because you mentioned stepping up investment, which is great. And you're seeing also the like-for-like trends recovering. But potentially, can you help us to understand a bit more the kind of typical lag you've got between making the investment and seeing the traction with the customers. So when you start to get the volumes up, is it already started? As you mentioned, you've seen already -- you've got a bit more data now, but can you give us a bit more granularity on that?

Yes, absolutely. And yes, what many people think is that we step up investment and initially or directly, we see a response into growth. That's unfortunately not what happens.

If you take the example of stepping up investments, acquiring new customers, then the customer acquisition is just a very small portion of our monthly orders. So increasing acquisitions will just very marginally increase our growth. However, it has a compounding effect as we add more and more and more customers and they order more and more frequently.

So we have a very easy way to see how the returns are coming from those investments. And that's why we see that the investment we have done so far will play out really well in terms of return and why we also feel comfortable with second half of the year as well as 2027.

So when we speak about things like customer acquisition, has a very long payback period, but a very high payback period. If you speak about building up Dmarts and so on, it has a little bit time to first set up the store and will have a negative impact or mostly the investment impact very initially and then you even see there. It will take a few months before you have any return on that at all, potentially even more.

So there are different investments. If you want to invest into vouchers, then you have a very immediate impact. And you will see instantly. And if you would do vouchers, we will easily be able to boost our order volumes. But that's not what we do. And we have seen other players doing these vouchers, deep discounts. Those customers are literally useless. So we don't see any repeat behavior when you give a customer a deep discount. So therefore, that's nothing that we believe in.

But that would have been the very fast return to instantly get the customer to order, instantly drive GMV. But again, that's not our strategy. Our strategy is to build the best customer experience, building loyalty, building service and those are investments that are done. So many of the investments will be returns of multiyear. But yes, you will start seeing some of the impact already this year, but it will also flow into 2027, '28 and so on.

Our next question comes from Giles Thorne with Jefferies.

It was a question on Korea, please. Niklas, it would be interesting to hear what you think the upside to your consumer value proposition would look like if you can move Korea in vendor funding to be as well developed as one of your best-in-class markets. I've always had the impression that it's a bit behind. And so understanding how much the consumer can benefit from developing that would be useful.

Yes, it's very, very large. It's a huge opportunity. So I don't know if I want to put a number here, but yes, I imagine you will be able to give another 5%, 6%, 7% more value to your customers. Of course, that is hugely valuable.

Alternatively, we don't have to spend that vouchers discount on that. So there will be a saving of several percent potentially that will flow directly into EBITDA. So of course, it's an enormous opportunity.

I think you're right. We haven't leveraged that opportunity enough yet. We are moving slowly, carefully on some of those topics, but yes, a big opportunity, same big opportunity when it comes to certain logistic efficiencies and huge opportunities in ad tech.

So we think there's a lot of opportunities. We are executing on those opportunities. But given the size of the business, it's still happening gradually, but we start seeing that playing out. So even if it grows fast, it's still a big opportunity and it will take some time until fully there.

We are also not -- as you know, we are not fully integrated into the global tech stack. In Korea, that is, of course, a big disadvantage. Some of the tools that we have like global incentive service and so on are not on our platform, and that is a big disadvantage, both for growth and profitability.

We hope that -- yes, that's where we stand today. So a big opportunity.

And just a follow-up on that around the execution risk and around the timing. It's quite noticeable that you've signed a lot of framework agreements and memorandums of understanding with various trade association -- restaurant trade associations in Korea over the past 18 months. How should we interpret that? Is that laying the groundwork for vendor financing?

Yes, I think we have been -- the team has done a tremendous job to build -- to revive the Baemin brand and make it a loved brand. That was one of the key priority of Austin to build a loved brand. And of course, we have had some very positive momentum, partially also by our competitors' mistakes has been partially helpful.

So I think we're getting there and part of building a loved brand is to making sure that all stakeholders are happy. And that's what we've been doing. We work very actively to making sure that all stakeholders are part of how we're building and building this together.

And that is why we are moving a little bit slower than probably what we normally would do. We take everyone along the journey. And I think that's long term the best way to do it. But yes, short term, of course, we could have been driving more profit, but that long term is better for our profit generation by making sure that we're building a loved brand among all stakeholders.

Our next question comes from Monique Pollard with Citi.

I had a question just on the quick commerce penetration. So obviously, massive improvements in the quick commerce penetration year-on-year and in terms of its share in the group, but very different regional dynamics that we see between the different regions. And interestingly, the region -- some of the regions with the highest penetration also showing the highest growth.

So what I was trying to understand is more a sort of medium- to long-term question, which is, are there -- do you think there, Niklas, a lot of structural and cultural reasons why the penetration in one region can't be read across to another, like MENA can't be seen, let's say, as the gold standard that everyone can move towards? Or do you think there can be a lot more conversion in that quick commerce penetration over time?

Yes. I think that's a great question. And what we see is that the markets where we started off, where we prioritize this first are the ones that are large. If you take the example in Middle East, that's where we started building multi-vertical, same with APAC. That's where we started building.

While if you take Asia, that was not really a priority and in Korea was not even a priority at all. So while Korea has only prioritized or we have only really been able to prioritize this over the last months, this is clearly behind, but we see the growth is accelerating, great momentum. So I think that is changing.

I think in terms of -- yes, no, I don't think there is a cultural difference there, except that if into our platform 10, 15 times a month, then, of course, it's a little bit easier to upsell them on the day of ordering other things than the restaurant food. While if your customers only coming to you 2, 3, 4 times a month, it takes much longer to building that penetration and get them to try something.

So that's why if you look at Europe, it's just going to take longer to kind of influence them. So that's why we also see kind of the best growth are markets where we already have high penetration share. And you can even see that on a country level, like there are some markets that are even above 50% now, and they grow really fast. So I think it's just about how we prioritize and how frequently we already today interact with our customers. Yes.

Our next question comes from Joe Barnet-Lamb with UBS.

Yes, I just wanted to circle back around to Saudi, where obviously, we've seen great growth and EBITDA trajectory as well. I think you also said that you sort of gained category share Q1 versus Q4.

Can you help us understand what you think the driving factors behind this have been? I mean, obviously, your competitive response has built, but we've also had sort of regulatory change there. I'm interested if you've seen any shifts in your competitors' sort of approach? And any color you can give that you think is driving that improved performance on your side?

Yes. So many factors here. Like one is, of course, everything that we build adds up and accumulates up. While on the other hand, what I mentioned before on the return question is if someone just gives Varion discount, yes, you build volume very fast. You have a very quick so-called return in terms of getting more GMV, more orders. But the sustainability of that return is very short term.

So you might never get more order of that customer unless you keep doing it. So you can easily get like 500,000 daily orders and stuff like that, and we have done it too. But how do you build from there? Because you have to spend a lot of money to get those 500,000 daily orders to come and order again next day and order then next day.

So in order to keep growing that, you just have to increase your burn. And at some point, they come to burn levels that just are not sustainable for anyone. So unless -- yes, so if you stop your incremental spend, you are going to decline as a company. And that's where we see that once they stop or no longer increase their burn, yes, that's trouble because there's nothing sustainable in that order or in that business.

I think that is one reason. And of course, if you pull back a little bit on that spending, it also means that some of those customers who might have been low-value customers, move to somewhere else to order, they will obviously come back if they don't get the deals anymore. So you have someone educating the market and potentially building that frequency, but if they can't sustain the discount vouchers, those customers will eventually come back to us over time.

Then yes, the regulatory side, of course, that can also be a contributing factor that you are not allowed to do price dumping and predatory pricing. So that's helpful. But I'm not even sure if that is really the limiting factor. It could be, but I also think anyone who looks at the return of the investments, would you see that is just throwing money out of the window and there is no return on the investments that is made.

So at some point, when you look 1, 1.5 years, someone will look at returns and probably come to conclusion that this is nonsensical and why would we keep investing in things with bad return. So I would also assume that at some point, there might also be a reduction in investments based on kind of seeing the true returns that they will have. So that might be another reason, but hard to tell.

Our next question comes from Wolfgang Specht with Berenberg.

One additional from my end on the legal side. Can you give us a quick update on the judicial situation in Italy and the legal challenges in Spain? Any changes over the last months?

Do you want to cover, Marie-Anne?

Yes, sure. So I would say as we've disclosed in the annual report, you have basically all the visibility there, and there's been no further updates since then. I think you mentioned Italy. I mean, there -- obviously, the work continues, right, which we've been engaged in over the last months, but nothing further to point out there and nothing in Spain. So the visibility that you have is the latest.

Our next question comes from Giles Thorne with Jefferies.

A question from Marie-Anne, please. How much of the costs associated with the tech hub in Singapore are linked to Taiwan, i.e., how much are you paying to people in Singapore can be removed or how many of the headcount in Singapore can be removed?

I would say, overall, and this is not particularly linked to Singapore. There is obviously services provided to the business in Taiwan as we do provide to all the platforms we operate in the countries you operate in, right? So that will be on the product side, on the tech side, et cetera. We will obviously take that into account as we transition the business.

And again, don't expect that to have overall an impact, right? So that we will basically be addressing some of those over time as we transition the business over. But I wouldn't link that specifically to Singapore, right, because services being given to Taiwan might be a broader base than just coming specifically from Singapore. But overall, as we mentioned, there is obviously costs associated with the business in Taiwan, which we will address over time.

Let me maybe add to that. So there is very little of the tech work that is done for Taiwan directly. So there is a point there that we are losing some of that scale. Having said that, we are going to run the tech platform for up to 1 year after the deal closes in H2. So there will be a very long time for us that we keep having to service Taiwan. And as you know, we are being compensated for maintaining that service to Grab in this case.

And yes, after that, we keep driving growth in our business and making sure that we have a good leverage on the work that we're doing. So we are confident that by the time we no longer service Taiwan, we will be at an appropriate level of investment for the size of the business at that point in time when it comes to APAC, Turkey as well as Europe or Foodora, which are the 3 brands which are operating on one platform. And Taiwan is a small portion of that platform.

Our next question comes from Annick Maas with Bernstein.

My question was with regards to the EUR 100 million annualized advertising revenues you published and integrated. I was keen to understand how much driving advertising was really a priority for you in this segment? Or respectively, if we should think about this as a very nascent opportunity and much more advertising revenues to come in the next quarters?

Yes. So we have, over the last years, really prioritized our ad tech actions and development when it comes to the restaurants and the food side. And I think we are a couple of steps ahead of our restaurants -- sorry, our peers in sophistication and returns that we can give to restaurants and to ourselves.

When it comes to the other side of the business, when we speak about groceries and retail and so on, it's much more early stage. We think that if the restaurant side, I think we have said between 4% and 5% long-term advertisement revenue and in many places, we're already there.

When we look at the -- if you take the Dmart side of the integrated verticals, we think that percent is significantly higher. And for the non-Dmart side, but on the quick commerce side, non-Dmart, it is higher than the food, but lower than the Dmart, putting it this way.

And here, we have been doubling down a lot starting end of last year. So we put a lot of the teams focused away from the restaurant side. We have more evolved into more people on the NMR side. So CPG companies and so on can do there. And I think we are doing very fast progress there. So we expect that by the end of the year, we'll be in a very, very good position to drive already now driving it very fast, but it's going to grow even faster next year, that revenue side. So we are early stage on that side.

Our last question comes from Andrew Ross with Barclays.

I wanted to ask about trading in the Middle East. You mentioned in the remarks that there had been a high single-digit percent boost in March on the back of the Iran conflict. Is that still persisting? It would be kind of interesting just to get a sense of what's happening on the ground there.

And I guess as a follow-up, any other comments you want to make in terms of thinking about growth into Q2 more broadly? And I guess I'm thinking out loud in Korea that you might start to lap up against the moment where you stabilize share on a sequential basis, but maybe any other comments?

Yes. So yes, March was a single -- high single-digit uplift, as mentioned. April, we had rather a little bit tailwind from moving school starts. So schools got moved a little bit and there were -- so I would say there was a slight negative in the first half of April. So 2 or 3 weeks, there are a little bit less. And then the last couple of weeks, we are completely back to normal.

So now we're back to where we were prior to the war. And hopefully, we can -- that we keep having positive momentum from there as more people coming back to the regions and so on. But right now, it's neutral impact. So back to normal, I would say.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Yes. Thank you, everyone, for listening in. While the strategic review remains our primary focus, our operational performance continues to excel. Growth across Asia and MENA has accelerated and our investments into deepening our offer are progressing exactly as planned.

The Everyday app strategy is delivering clear results, evidenced by the exceptional growth in quick commerce. Furthermore, the integration of AI across our day-to-day operation is significantly accelerating our pace of innovation.

We are highly encouraged by the momentum as we remain dedicated to execute on our core strategy and concluding the strategic review. So thank you, everyone, for listening in.

This concludes today's call. Thank you, everyone, for joining. You may now disconnect.

Welcome to the Delivery Hero Annual Report 2025 and Full Year 2025 Results. Today's presentation will be followed by a Q&A session. [Operator Instructions] I will now hand over to Andrea Ferraz Estrada to begin the presentation.

Thank you. Hello, and welcome, everyone. Thank you for joining our full year 2025 earnings call. Joining me on this call are Niklas Oestberg, CEO; and Marie-Anne Popp, CFO at Delivery Hero. Together, they will present the key highlights of our full year 2025 results. Following the presentation, we will be delighted to address any questions you might have.

Now over to you, Niklas.

Thank you, Andrea. So 2025 was a defining year for Delivery Hero. We came into the year with a clear plan, delivering profitable growth and provide -- or prove that our platform can evolve well beyond food delivery as we transition towards becoming an everyday app. I'm proud to say that we did both.

We just -- or we didn't just defend our core markets, we strengthened them, seeing a return to momentum or return momentum in Korea and Saudi Arabia towards the end of the year. We scaled quick commerce, a key driver of growth and our everyday strategy. We migrated additional brands to our single global tech stack, leveraging a single platform to drive both improvements to the customer proposition and efficiencies across Delivery Hero.

Looking ahead, our priorities for full year '26 are clear and focused on 4 pillars. First, we will continue strengthening our leadership across geographies. We will do this by driving growth and deepening loyalty through our subscription program, expanding our offering and continued improvements in our proposition.

Second, we are doubling down on quick commerce, expanding our assortment and experience to ensure we are relevant for customers' daily shopping needs, whether it's grocery, beauty products or health care. Third, we are accelerating our AI initiatives automating 85% of first-line service contacts, rolling out AI agents for sales and support and launching conversational ordering.

Internally, our engineers are integrating AI agents and tooling to maximize development efficiency. And last but not least, we continue to progress on our strategic review with a clear mandate to unlock shareholder value. To understand where we are going, you have to look at the shift from a single vertical food platform to a multi-vertical ecosystem.

Two years ago, the vast majority of our volume was restaurant delivery. In 2025, quick commerce alone surpassed EUR 7.5 billion in GMV, growing over 30% year-on-year. We are expanding into health and beauty, pet care, household, essentials and more. Our customers are responding with loyalty and frequency.

Higher engagement also enables us to find ways to monetize the experience with our ad tech products now approaching EUR 1.5 billion revenue run rate, moving us beyond a reliance on commission alone. Most importantly, customer behavior is transforming customers who engage with us across multi-verticals spend 5x more than those who only choose us for their meals. This is the everyday app advantage in action.

Next slide shows us the incrementality of quick commerce. When food customer places their first quick commerce order, we see a strong flywheel effect. Their food order frequency drastically increases from 4.6 to 5.9 orders per month, while adding a whole new stream of quick commerce orders on top. This boosts the frequency to 8 orders per month.

By offering a full day service from morning breakfast essentials to late-night snacks, we are not just weekend treat, we are a utility. This is why we are confident in hitting EUR 10 billion in quick commerce GMV by 2026 full year. And by pairing the broadest local selection with a superior delivery network, we are widening our competitive moat in every market.

Finally, I wanted to touch on the strategic review. Earlier this week, we announced the Taiwan disposal of $600 million, which was the first major step in our plan to unlock shareholder value. This is our fifth big country divestment over the years and shows our pragmatic view to the value -- our comprehensive strategic review supported by JPMorgan is ongoing. We are evaluating multiple strategic options with due care. While our operational momentum is strong and independent of these reviews, we acknowledge the current valuation disconnect.

We do not believe our share price accurately reflects the growth trajectory of this business. As I've said before, we welcome the dialogue with our shareholders. We are fully aligned from the Management Board to the Supervisory Board on our commitment to closing the gap and delivering the value our shareholders expect from us.

Thank you, and I'll hand over to you, Marie-Anne to walk us through the financials.

Thank you, Niklas, and a warm welcome from my side as well. We delivered another year of solid GMV growth of 9% on a like-for-like basis and revenue growth of 23%, reflecting the expansion of our own delivery offering and growth of our Dmarts business.Dmarts business.

Adjusted EBITDA grew by a strong 30% year-over-year, reaching EUR 903 million, highlighting the strong underlying operational performance and continued cost discipline. We also saw strong gains in cash generation with free cash flow growing 15% year-over-year to EUR 250 million, driven by improved working capital efficiency and lower tax payments.

Finally, we strengthened our balance sheet through multiple corporate actions, including the recent refinancing and the sale of Taiwan, putting us in a stronger liquidity position and giving us more flexibility going forward. Zooming out to our performance over the last few years, the trend is clear. We've been able to deliver very consistent growth and improved profitability. We've turned the business profitable on an adjusted EBITDA basis and continue to materially expand margins since.

Very importantly, we have delivered positive free cash flow for a second year in a row. And we have delivered this progress in the face of FX headwinds and an evolving competitive landscape. The work we've done over the last 4 years brings our brands onto one central tech platform to drive order frequency and basket sizes, defend and expand our market positions as well as grow ad tech revenue and generally to focus on cost control, while continuing to deliver top line growth has paid off.

On the next couple of slides, I will look to bridge some of the key movements between adjusted EBITDA, net income and free cash flow. Management adjustments came down considerably to EUR 147 million. They now account for less than 0.3% of GMV. The main item this year falls under reorganization measures, which were mainly driven by provisions for legal risks associated with the transition to the new employment-based rider model in Spain.

Share-based compensation increased to EUR 224 million, driven by a different vesting structure and lower expense reversals due to a new long-term incentive program. Going forward, we expect it to remain broadly stable. The shift in other reconciliation items moved from positive EUR 158 million to negative EUR 260 million, which can be traced back to the Uber breakup fee we recognized in 2024 as well as goodwill impairment in 2025.

Putting everything together, this translates into an EBITDA increase of 74%, ahead of the adjusted EBITDA increase of 30%. The financial result was affected by fair value adjustments of minority investments, which were positive last year and negative this year. Taxes for Delivery Hero are levied in the key profit centers. One-off events led to a higher level of tax in 2024 with 2025 offering a better reflection of ongoing tax levels. The net result improved by EUR 183 million in 2025.

Let us now have a look at our free cash flow on the next slide. While the net result improved by EUR 183 million, cash flow from operating activities declined year-on-year. Change of working capital improved by EUR 138 million, but it was largely offset by the one-off Uber breakup fee in the comparative period and payments related to the shift in rider model in Glovo Spain.

Changes in provisions were driven by opposing effects. In 2024, we increased the provision for the EU antitrust case as well as provisions for rider-related risks in Spain and Italy, while in 2025, we made the payment and released the provision for the EU antitrust case. CapEx increased moderately, reflecting investments in our ecosystem as part of our everyday app strategy.

In the last year, we've made significant progress in reducing our leverage. We recently announced a new term loan facility due 2032 of USD 1.4 billion. We intend to use the proceeds to fund the repayment of our maturities in 2026 and 2027 as well as general corporate purposes. Pro forma for the refinancing, it would leave our cash balance at EUR 2.7 billion against EUR 2.25 billion in outstanding convertible bonds and EUR 2.8 billion in term loans.

We expect to receive a further EUR 520 million at closing of the Taiwan transaction, which will be used primarily for debt reduction as well as general corporate purposes. Our liquidity position is robust, providing the financial flexibility we believe is prudent given the current geopolitical backdrop.

Let's have a look at our guidance for 2026. Our full year GMV guidance remains 8% to 10% like-for-like, consistent with our growth rates during the last 2 years. While Q1 growth is currently tracking within this range, year-over-year FX comparisons remain a headwind following last year's USD and Korean won devaluation. Revenue growth is expected to continue to exceed growth in GMV through a combination of our ongoing own delivery rollout and the strong growth of our quick commerce business.

The gap is expected to be lower than in 2025, reflecting a slowdown in the transition to own delivery, having already achieved a level of 78% on a group level in 2025, strongly increasing from 67% in 2024. For adjusted EBITDA, we expect a range between EUR 910 million to EUR 960 million in 2026 as we increase our investments in customer loyalty in key markets, including MENA and South Korea as well as investments in integrated verticals.

Free cash flow is expected to be more than EUR 200 million for 2026. This guidance reflects the ongoing improvement in business performance and the investments in our Dmarts business. As discussed during the call earlier this week, we expect to receive EUR 520 million at the closing of the Taiwan transaction, while the impact on adjusted EBITDA will be marginal. That's it from my side.

Thank you for your attention and for your continued support as we build on the strong momentum. We're now looking forward to taking your questions. Operator, please go ahead.

[Operator Instructions] Our first question is from Jo Barnet-Lamb with UBS.

The market is clearly concerned by the process overhang. It almost feels if it's acting as a cap on your share price at present. I'm interested in how you view that stake. Do you see it as an issue that you have a role in fixing? Or do you see it as process and the market's problem?

Niklas, I believe you might be on mute.

Apologies for that. Jo, I'll do it again then. So yes, the process overhang is obviously a clear problem for us. So -- but at the same time, it's not our decision. We are happy to help in whatever shape and form we can help. But in the end, it's a process decision what they do with that stake. And yes, I guess they will have to answer that. But again, we are happy to help in whatever shape and form we can.

Our next question comes from Andrew Ross with Barclays.

I wanted to ask about liquidity and free cash flow. This is for Marie-Anne. So when we think about your true free cash flow in 2026 when we include cash exceptionals, the minority dividend to Talabat and interest payments, how much cash do you expect to leave the business? And I appreciate you may not have perfect line of sight on all of the cash element of legal costs, but if there are any best estimates as to how we should think about exceptionals in the cash flow statement this year, it would be very helpful.

And then the follow-up is, can you remind us how much liquidity the business needs either for new covenants on the debt or just for kind of day-to-day operations? I think the last time we spoke about this was about EUR 800 million back in 2024, including the undrawn element of the RCF, but it would be very helpful to have a sense of what you need to run the business now relative to your current cash levels.

Andrew, so I'll start with the first part, which was, I think, the question on extraordinary cash flows expected. So as you saw, we guided on free cash flow, excluding extraordinary outflows. And part of that is because we do provide obviously detailed disclosures on provisions on contingencies in the annual report.

But at this stage, there's no material new updates or anything we could guide you on in terms of cash outflows, right? So I think the disclosures that we have given, I think, give an indication of where we see the need for provisions and for contingencies, and we've booked those. But at this stage, the guidance we can give is on, let's say, cash flow before extraordinary items.

Moving on to your second question, which was on the minimum liquidity. So I think you're referring back to the EUR 800 million, which is a covenant that requires us to hold that amount in cash. That is still in place. So that is basically still the, let's say, the minimum amount that we would operate under, right, and kind of brought the floor for us as to where we have to be.

And I'd say we have no, let's say, other fixed amount that we set ourselves and that we have fixed with the banks in this case, right? But I think you can assume a slightly higher amount for ongoing operations. But again, the floor and the minimum amount that we operate under is the EUR 800 million.

So we can conclude that the current cash on your balance sheet is a lot more than you need to run the business?

Yes. I think we currently have a very strong cash position, as you've seen, right? I think the primary use that we want to do with that cash and the funds from the new facility and then eventually also when they come from the Taiwan disposal is certainly to repay existing debt to strengthen the capital structure and to -- as a first step, as we announced already on the 5th of March, right, to utilize the proceeds to repay the existing '26 and '27 convertible bonds, which is pretty much in line with how we've addressed our debt profile in the past as well, addressing basically the short-term maturities first, right?

I think you can expect to see an announcement on that pretty soon. And I think as we see then how the market conditions improve, we would also contemplate refinancing some of the other existing debt. And certainly, we find that going to that process with a strong liquidity position is quite helpful, right?

Other than looking at the debt we hold, I think we always look at the most accretive ways to deploy cash reserves. But currently, I think in -- especially in the current geopolitical environment, we find that the high level of liquidity provides us with a lot of flexibility and is in the long-term interest of the company.

Our next question comes from Giles Thorne with Jefferies.

It was a question on Korea and specifically the spring discount event Baemin Festa. There's disclosure there that says you're seeing 40% order growth in the first 2 weeks. And my question was, could you clarify, Niklas, whether that's for the whole of Baemin, for the whole of Korea? Or is that just 40% order growth for the restaurants that are participating in the event? And then if you could just use your answer as a way to expand a bit more on current trading, that would be useful, too, Niklas.

Thanks, Giles. So we don't want to comment on potential external data. We often see that external data is very incorrect both on a daily, weekly, monthly, it's pretty random for one reason or another. The data sources that we have are very accurate also when we compare to our peers. But yes...

Sorry to interrupt you, Niklas, but the 40% is actually from your press release.

In that case, you can trust it, but it will be a short being for selected vendors and so on. So I wouldn't draw too much around that, what it means for the overall business. I could say, though, that the business is doing overall very good, as you would expect. And over the last 18 months, we have done a complete rebuild of that Korea operation model with overall in pricing, tech architecture, new subscription program, which is now nearly 50% of total order volumes.

We have also done UI changes. We expand our quick commerce, and we definitely see our category share has been growing during all of H2 since mid of last year, I would say, and not just related to coupons, credit card challenges. That was a very minor impact to us. But yes, so overall, we feel very good about Korea. We think we are well on track. And yes, we feel happy with the development.

And do you have a comment on why the current trading for the group?

Well, we -- I think what we said is that we are trailing within our guidance. So I think, yes, we have a solid start. And yes, I think the improvements that we saw, particularly in Korea and Saudi Arabia end of last year, they have also continued into Q1. So I think overall, we are happy with the development.

On a reported currency, you should keep in mind that we did have some FX headwind after liberation day, when it comes to U.S. dollar and then in Korean won, it was a little bit throughout the full year, at least until end of the year. So on a reported currency, it is lower than on the constant currency, in particular until then April. But yes, overall, I think we had a good start.

Our next question comes from Luke Holbrook with Morgan Stanley.

It's really just a follow-up really on Charles' question there on performance, but specifically in the Middle East, just given what's happening in the region. Can you just comment a bit directionally on the performance of Talabat and Hungerstation, presumably more people are at home at the moment, but also like have you had to invest a little bit more on the rider side as well?

Maybe first, given that it is a conflict and I just want to say that our first priority is to drive safety for our people, riders and partners. And we obviously monitor the regional development very closely and the local leadership teams remaining in close contact with authorities on the ground. And our teams are experienced in navigating complex environment.

And so I think on that side, I feel good that we can keep people safe. Then on service, we have kept a reliable service in place as well. In terms of demand, we saw a boost in the beginning of the conflict. We are now more on normal levels, when it comes to the food side, a little bit uptick in the quick commerce side as people stay home more.

So yes, net-net, maybe slight positive. It's too early to say what kind of long-term impact of a potential extended conflict would be. In terms of delivery operations, we operate full capacity. And again, our priority is to keep people safe and keep a reliable service. And let us hope that the conflict will end.

Our next question comes from Monique Pollard with Citi.

The first question, just following on from Luke's question there on MENA trading. Just interested in whether you've seen a boost, particularly to grocery delivery in UAE and whether the fact that Meituan doesn't have grocery delivery in that market is helping you, you think, with your market share there?

The second question I had, probably one for Marie-Anne, is about the contingent liabilities. I just want to make sure I've understood it properly. So from what I can see in the annual report, there's between EUR 640 million and just over EUR 1 billion of these contingent liabilities, of which just over EUR 500 million to close to EUR 900 million relate to the Spanish riders, but you've already paid out EUR 524 million for those at the moment. So the way I understand it is the absolute max potential further outflow from the contingent liabilities is EUR 523 million. And I just want to understand if that's correct.

And then the final question was just on the strategic review. To the extent you are able to give any high-level thoughts Niklas, just wondered if you could -- obviously, I don't expect to name markets, but any details you could give on the number of assets, for instance, being considered or high level, how things are progressing would be really helpful.

Sure. Yes. So on the first one, as mentioned, grocery has been a little bit stronger. I think what is also clear that our service is very strong. We have a significant advantage in product experience and service versus our peers. So -- and I think that has been in particular clear during this time, but also during Ramadan in general, it's usually a more difficult time to operate. And I think that has been very clear that we are -- yes, substantially stronger operational excellence there.

I think overall, there has maybe also been a little bit of a pullback from -- and I mentioned Meituan here, partially because of probably a government making sure that there is no use of predatory pricing. But I think also as they have been spreading themselves a little bit thinner, and I think it's also -- the impact has been less and less from that and the strength of our business has been stronger. But that's what we said all the time. I mean we have a superior product and experience, and that's what people appreciate. I think they appreciate that in particular during these times. Contingent liability, Marie-Anne?

Sure. So contingent liabilities, indeed, so for Spain, we have a range of EUR 520 million to EUR 860 million in the list of contingencies detailed out that has increased, since the middle of last year as we've obviously transitioned the model. And so we stopped accumulating more risk and more contingencies here.

And yes, EUR 524 million have been paid out. That is not to say that the remaining amount will need to be paid out, right? So it's not necessarily that each year of contingency will result in the cash outflow. But I think, if -- your example is a theoretical mass amount, then yes, that calculation would be correct. But again, it's not necessarily a one-to-one correlation between the amount of contingency and the cash paid out. So yes, I think it's a theoretical calculation that you're doing.

Then on the strategic review, we cannot say much than that we have taken a very broad approach in running this strategic assessment and review together with JPMorgan, and we obviously work very closely between the Management Board and Supervisory Board to make this evaluation and then also get into discussions with potential parties.

I can only share that we are very focused on executing well on this strategic review. We have already, over the years, done 5 successful asset sale in Delivery Hero, the latest one, obviously being Taiwan. This is, in fact, Delivery Hero is, in fact, the only delivery company that has successfully sold any assets. So we have seen many smaller fire sales like Hong Kong and so on, but we have not seen any company outside of Delivery Hero doing any successful sale of asset because it is difficult while we have done it 5 times.

This shows both that we are extremely rational in -- when it comes to driving shareholder value, but also shows that very good at it. And I think there are 5 reasons why we are very good at it. First, we know our parties very well, and we are very pragmatic in finding common value when we do these things.

And secondly, we follow a clear methodology. Thirdly, we come very well prepared, and we are very diligent. We are very patient, and we have plenty of experience. So for those reasons, we are confident that we'll be able to drive shareholder value through this process. A part of the M&A, the strategic review is also evaluating other strategic ways to drive shareholder value. But yes, that's pretty much what we can say on the strategic review. We will update you if there's anything that we can update you on...

Our next question comes from Annick Maas with Bernstein SG.

It's somewhat a follow-up on Monique's question. But in light of all these resources on the strategic review, if I think about Delivery Hero 5 years down the line, what's the vision for Delivery Hero? I think we all understood that it's an everyday app that's going to have 5% to 8% margins. But what is the vision? Is this going to be a quick commerce app in the Middle East? Is it going to be focused on the Americas? Can you just like -- how do you think about it a bit further down the line?

Great question. Yes, we do have a clear strategy, and we do see a clear opportunity, when it comes to our everyday app and the TAM and the opportunity we are approaching much larger than food delivery, where we're stepping into here. So we do see clear value in the strategic view of strengthening our balance sheet and focusing our efforts to drive clear leadership in the markets that we are very -- have a high priority on to making sure that we are emerging as a clear leader in those places.

So our strategy has always been to drive clear leadership, and that has not changed. And I think what has changed is that we see a much larger opportunity, much bigger than we ever thought it would be. And that's why we do see clear value in slight focus and improved cash balance to making sure that we can maintain the clear leadership we've had.

And I also like to emphasize that we have been competing for many years with the Uber and the DoorDash and now also mostly to Meituan, but we have competing with iFood in many markets, and we have competed with, yes, many other players over the years, GST, Deliveroo, et cetera.

And we have always or almost always, as you said, emerged as the clear leader. We are clear with almost every market. So it shows our strength in what we're building and our operational execution capability that the team is having. Now we want to make sure that we even further focus that execution to build on a much larger opportunity. So that's what we are very excited about and what we execute towards. And I hope that we'll have the opportunity to speak a little bit more about that sometime during this year.

Our next question comes from Jo Barnet-Lamb with UBS.

Excellent. We've had Talabat state their intention to start a buyback. I'm interested as to how you intend to respond to that. Do you think you'll sell pro rata into the buyback? Or do you expect to keep your stake unchanged? Sorry, do you expect to not sell into it, sorry?

We do not expect to sell into it, no. We are very bullish about Talabat.

Our next question comes from Andrew Ross with Barclays.

I'm going to sneak in 2 follow-ups if that's okay. First one on the back of Jo's. Can you kind of talk through the decision as to, I guess, why choose to use the holdco level cash to buy back shares in Talabat versus the Delivery Hero level? I understand that Talabat is part of that decision as well.

And when we kind of think more broadly, if you were to sell something in the strategic review, how do you kind of think about the relative value across the Talabat and Delivery Hero structures in terms of where the most accretive use of that capital may be for shareholder returns?

And then my second question is again on the strategic review. To what degree is the AGM a consideration in your thinking as to when we may hear anything more in the context clearly of some dissatisfaction being expressed by shareholders in the press?

Sure. Marie-Anne, do you want to cover the first part? Or do you wanted to...

Yes, I'll maybe start with the Talabat part. I think the decision for Talabat to announce the share buyback, I think, was on the back of Talabat being a strong and in particular, strong cash-generative business. From that point of view, it made sense as kind of Talabat reached that part in -- of being a mature company and having the cash necessary to do that.

And I think, again, also obviously, the valuation of the business being a factor in that. I think as Niklas already mentioned, we're strongly supportive of that. And obviously, we're part of the decision and -- but will not be participating in the buyback because we obviously believe that the company is undervalued and we will keep our stake in Talabat as is for the moment.

Then on the strategic view, if there is any asset sale and any cash income, what we would do, I think we will take that when that comes. We -- so I'll pass that for now unless you Marie-Anne wants to answer it. I think overall, we do have a target to reduce our debt level, so leverage ratio slightly from current level. But what we do beyond that, I think we'll come back when that time comes.

In terms of the strategic view and how we consider the AGM Well, as I said before, we have been very successful in this. And we have the first, second, third, fourth and the fifth most successful asset sales in history among all 6 or 10 or whatever players that have multi-markets, when it comes to asset sale or country sales.

So I think we are very confident in what we are doing. And that follows a clear approach, where -- which also include we have following a clear methodology, knowing the different parties and how we how we can together drive value together with those parties is being prepared, is being diligent, is being very patient because if you don't follow these things, you are never going to succeed in successfully in the strategic review.

So we are going to be very diligent as we do this and the Supervisory Board, with the Management Board and our adviser, JPMorgan. We are all very aligned on this. So we are not going to let an AGM impact our methodology and approach that has made us successful in the past. We are going to follow that and pay no attention to the AGM in that sense.

[Operator Instructions] Our next question comes from Silvia Cuneo from Deutsche Bank.

I have a question on Europe, where the adjusted EBITDA loss in 2025 was impacted by the shift in rider model. And I wanted to check if within the H2, you had reached close to breakeven in Q4 as you previously targeted? And if you could talk about your expectations for profitability of this segment in 2026 and risks of shift of the driver model in other countries beyond Spain? Would you consider taking a more cautious approach and employing the riders anywhere, like, for example, in Italy.

And then secondly, another question also related to the adjusted EBITDA outlook for 2026. If you could comment on whether you still expect around flattish levels of adjusted EBITDA for MENA and Asia at constant currency that you had previously indicated in the calls before.

Do you want to cover it?

Yes, I'll start. So I think I'll start with the Europe piece. And yes, as you correctly pointed out, obviously, last year was affected by, in particular, the wider model transition in Spain. That took place in the first half of the year and then the second half of the year was focused on improving operating performance after that transition. And so Europe, yes, ended up around breakeven in the fourth quarter as planned. And obviously, improving from there and continuing to work on, in particular, improving the operational performance post rider change.

I think your second question was more broadly around employment of riders. That's a topic that's very much country-specific, right, and very much -- it needs to be in line with the model in place and the requirements and the legislation in place. We're also seeing a number of markets where legislation is shifting, evolving or rider topics are being legislated, right?

So I think what we do make sure that we approach the topic very much on a case-by-case and country-by-country basis that we make sure that we are compliant, that we make sure that we anticipate changes and we adapt our operating model to what's needed in that particular market. And I think as you've seen in some markets, it does -- it does involve employing riders in some markets. It involves a hybrid model where we have some employment and some freelance.

So it -- I would say it very much depends what is possible, what the rules and regulations are and what economically makes sense in the market. So it's very tough to have a broad answer on that, but it's obviously something that's very front and center of what we're doing and constantly evaluating and where we also have to adapt as the market and the environment adapts. And then you have to remind me on your last question on EBITDA.

Just fishing in on -- you mentioned Italy specifically. And there are no discussions at this point in time that we will move to employment model. That is not what the prosecutor is after the way we understand. So -- and there is a clear circularity on operating model, and we follow that very carefully. So that at this point in time, we don't see that as an outcome.

And the second question is about the outlook in MENA, I think, in particular, and how we saw that. I think you also mentioned. I think we had a good start, but I know we're not going to change the guidance at this point in time, what we have given before.

Our last question comes from Jurgen Kolb with Kepler Cheuvreux.

Fantastic. Two probably smaller questions. The first one is on the Dmarts. How many DMarts are currently running? What's the plan for '26 and outgoing? And especially if you could maybe share some additional details about the KPIs, like what's the order per DMart? How do you see that trend developing and the number of SKUs within the Dmarts currently?

And then the second thing, very easy probably on Italy, again, a little bit of a follow-up. Is there any kind of a specific date, when there could be another comment from the authorities on that Italian situation? Or is that just simply just ongoing and a little bit with an open end?

Do you have the exact number ahead of you in front of you right now with the Dmart?

800 Dmarts, yes.

Yes. And there is a slight increase and slight growth in that number. So over the years, we have taken it down, and now we see a slight expansion of that. We are also expanding the number of SKUs. We also see orders per store obviously going up as the business is growing with around 30%, as we said, and with just a marginal increase in number of stores. So you can also see that the number of orders per store is going up, which is very healthy for economics.

As you can imagine, I think we have said that we will remain on slight positive EBITDA, while still reinvesting in this space. When it comes to Italy, yes, we will come back with more information, when there is something to say. I can only tell that we're working very closely on -- yes, with the authority to clear out any misunderstanding or misperception or any feedback that they give us on how we can improve our business in one way or another. I think that's very helpful. And yes, I hope that we over -- yes, not-too-distant future, we'll be able to speak more about it and hopefully have a very good outcome of it.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Thank you all for listening in. As mentioned, 2025 was a year in which we demonstrated that we deliver profitable growth and execute on our strategic priorities while continuing to generate positive free cash flow.

And our 2026 outlook reflects a deliberate choice to lean into the areas where we see the strongest returns, and that is, one, deepening our offering in our largest profit pool; and two, expanding our vertical reach. On the strategic review, as mentioned, we remain fully committed and confident that we can deliver good shareholder value from there. And that's it from us. Thank you very much.

This concludes today's call. Thank you for joining, everyone. You may now disconnect.

Welcome to the Delivery Hero Q4 2025 Trading Update. Today's presentation will be followed by a Q&A session. [Operator Instructions]

I will now hand over to Christoph Bast to begin the presentation.

Hello, and welcome, everyone. Thank you very much for joining our Q4 2025 earnings call. Joining me on this call are Niklas Oestberg, CEO; and Marie-Anne Popp, CFO at Delivery Hero. Together, they will present the key highlights of our Q4 2025 results. Following their presentation, we'll be delighted to address any questions you might have.

And now over to you, Niklas.

Thank you, Christoph, and welcome, everyone, and thank you for listening in. So 2025 was a challenging year with tough competition, FX headwind and regulatory uncertainties. Therefore, I'm very happy to share that we returned to growth in Korea as promised. We completed the rider model [ change ] in Spain and Italy. We accelerated growth in Saudi Arabia at the end of the year, which was even beyond our highest expectations. I'm also very happy to have turned the Integrated Verticals segment profitable while growing very fast. Staying on the topic of integrated verticals and Quick Commerce in general, then let's move to the next slide.

So what you can see here is our Quick Commerce business, which represents the next frontier of our platform's evolution. We have moved beyond traditional food delivery to become an indispensable Everyday App, leveraging a hybrid model of food delivery, owned Dmarts and local retail partnerships. The primary strategic advantage is the deep structural stickiness it creates within our user base.

We aren't just a service, we are a daily habit. We capture diverse shopping occasions across the entire consumer journey, starting from your essential grocery shopping over pet food, electronics to health and beauty products and so on. The result speaks for themselves. Quick Commerce is currently outpacing food delivery with GMV growth of over 30%. In addition to continued strong growth in groceries, we are seeing significant momentum across non-grocery verticals.

Within this, health and beauty stands out, contributing over 50% year-on-year growth, while non-grocery as a whole already accounts for 20% of our Quick Commerce volume. With 2025 GMV surpassing EUR 7.5 billion, we are scaling rapidly to meet our 2026 GMV. Target of around EUR 10 billion, solidifying our position as the leader in instant grocery and retail delivery.

Now moving to AdTech. Some time ago, we gave the ambitious long-term target for our AdTech business to reach more than EUR 1.5 billion revenues in the full year of 2025. As you can see, we came very close to this target despite a slower rollout of our AdTech products in South Korea. Although the share of AdTech revenues in Korea constantly increased in the last 2 years, it is still behind the group average, leaving plenty of upside.

On group level, AdTech revenues grew to 3.0% of GMV in 2025. And in Q4, 2025, the share reached already 3.2%, with very attractive adjusted EBITDA margins. Our continuous improvements to the performance of the ad products contribute strongly to this growth. To name some key developments: Our personalized ad ranking system leverages neural networks to improve the relevance of ads and the efficiency of our user targeting.

This, combined with our machine learning-based automated ad bidding and pacing, enabled return on ad spending to improve from 3.9x to 6x between 2022 and 2025, and is unlocking significant additional investments from vendors. In simple words, we offer better and more relevant ads with greater returns to our vendors.

Throughout the years, we have stretched and strengthening our ad product portfolio, from launching display ads in 2025, our CPC rollout in Woowa in 2022 to keywords revamp and video as launched in 2025. These products support restaurants and vendors to increase visibility and conversion rates. Going forward, the main growth drivers for our AdTech business will be Woowa, Glovo and PedidosYa, which are all below group average right now but growing strongly. Our long-term ambition remains to achieve AdTech revenues of above 4% of GMV.

And AdTech is just one area where we are seeing huge improvements from AI. As we navigate the broader AI transformation, they view our complex [ physical ] operations as profound structural moat. AI agents help us predict demand or recommend great restaurants to customers, but they cannot move physical goods, manage millions of real-time merchant integrations or run hyperlocal logistics, Dmarts and kitchens.

Because our business is fundamentally anchored in hard, real-world execution, we're highly insulated from purely digital disruption. Ultimately, we see ourselves as massive beneficiaries of this revolution, leveraging AI to drive huge upside across consumer experience, merchant success and bottom line efficiencies.

So with that, let me now hand over to Marie-Anne, who will guide us through the financial highlights.

Thank you, Niklas, and a warm welcome from my side as well. We finished the year 2025 strong, with Q4 showing further improvements in our 3 main focus areas: top line growth, profitability and cash generation.

GMV in Q4 increased by 8% year-over-year on a like-for-like basis, and including -- excluding hyperinflation and FX effects, accelerating from 7% year-over-year in Q3, driven by significantly improved momentum in Asia. Revenue grew by 21% year-over-year on a like-for-like basis, growing again markedly faster than GMV.

Profitability also improved with gross profit margin expanding to a new all-time high of 8.3% in Q4. The adjusted EBITDA grew to more than EUR 900 million in 2025 despite elevated growth investments in MENA and Asia, as well as particularly strong FX headwinds from the U.S. dollar and Korean won.

One thing I'm particularly pleased about is that our free cash flow came in at more than EUR 200 million. If we go to the next page, Orders on group level grew by 9% on a like-for-like basis in Q4, accelerating from 8% in the previous quarter as the Asia segment has returned to growth, while all other segments continue to grow strongly. As mentioned, GMV growth for Q4 reached 8% on a like-for-like basis in constant currency, and excluding hyperinflation accounting, improving from 7% in Q3.

Revenue increased by 21% and has remained above the 20% mark at the group level for several consecutive quarters. This robust growth continues to be fueled by the ongoing expansion of our own delivery logistics, particularly in South Korea and Turkey as well as a shift to the new rider model in Spain. In addition, the sustained strong performance of AdTech business and the continued appeal of our subscription programs have further supported this momentum.

Let us take a closer look at the preliminary results for the full year 2025. The guidance for GMV was increased to the upper end of 8% to 10% year-over-year growth during our H1 trading update. Our slightly increased growth in Q4 was not able to fully compensate for a slightly weaker-than-expected Q3 growth rate, and we arrived at a 9% year-over-year growth.

Total segment revenues rose by 23.1%, coming in at the midpoint of our 22% to 24% year-over-year guidance on a like-for-like basis. Adjusted EBITDA reached above EUR 900 million, compared to our guidance of EUR 900 million to EUR 940 million. And free cash flow exceeded our guidance of more than EUR 120 million and came in at over EUR 200 million, due to improved working capital efficiency and lower tax payments. Hence, we are pleased with our preliminary results for the full year 2025 and will now dive deeper into the Q4 performance on a segment level.

In Europe, GMV growth was temporarily softer in the second half of 2025 since we were still optimizing the operational efficiency following the successful transition of our rider fleet to an employment-based model in Spain. This will still have some effects on the top line in H1 before growth is set to reaccelerate again in the second half of 2026. Performance in markets outside of Spain stayed robust, supported by healthy increases in orders and GMV in the majority of countries.

Revenue growth in Europe was again driven by the year-over-year expansion of our own delivery logistics, which reached 82% in Q4 2025. The implementation of the new rider model in Spain and its associated change in revenue recognition as well as strong AdTech revenues and increasing basket sizes resulted in a particularly strong growth of 34% in segment revenues.

After business review of our operations in Finland, we concluded that reaching a category leadership position would require prolonged and disproportionate investment relative to the long-term returns. That's why we exited the market as of mid-February, and we'll focus our energy on countries where we are already #1 or strong #2 and where we can generate the highest long-term returns.

Adjusted EBITDA in Europe came in close to the breakeven point in Q4 2025. Through further efficiency improvements, we expect to be around adjusted EBITDA breakeven for the full year 2026.

Let's move on to MENA. We have again delivered robust GMV growth despite challenging prior-year comparables as Q4 '24 was exceptionally strong due to concentrated growth initiatives. Throughout the region, fair competition regulations are being rolled out across Saudi Arabia, the UAE, Kuwait and Qatar, creating a more balanced environment that benefits the entire MENA ecosystem. It puts a halt to predatory pricing mechanisms that distort competition, disrupt smaller innovators and add a significant cost burden on local restaurants.

Order growth in Saudi Arabia picked up again in December, with momentum even accelerating through January and early February. This performance was driven by an enhanced subscription offering with half of Saudi's GMV already coming from subscribers. Further investments are targeted incentives for high-value customers and the expansion of the multi-vertical proposition.

Talabat once again delivered strong operational results, achieving 20% year-on-year GMV growth in Q4 2025 despite exceptionally high comparables from the prior year with growth of 33% year-over-year in Q4 2024. Growth was supported by the continued expansion of Quick Commerce and subscription offerings, improved partner-funded savings and an ever-growing selection. In Turkey, profitability improved substantially, resulting in positive adjusted EBITDA in the second half of 2025.

Now on to the Asia segment. GMV returned to growth on a like-for-like basis in Q4 '25 across the entire Asia segment, supported by category share gains since May and increase in orders in South Korea, both driven by ongoing improvements in customer experience, which, among other things, has resulted in an outstanding year-on-year growth of 31% in the Quick Commerce business.

The rest of Asia continued to strengthen, delivering GMV growth of 11% in Q4 2025, supported by an improved restaurant selection, more attractive vendor-funded deals, subscription rollout and a leading Quick Commerce proposition. We expect this positive momentum to accelerate further throughout full year 2026. Our operations in Hong Kong can look back on a particularly strong year in 2025 with accelerating growth throughout the year in both orders as well as GMV.

Building on the momentum, the region and, in particular, Korea, has had a strong start to Q1 2026, with further acceleration in top line growth. Revenue growth remains robust, underpinned by the continued rollout of own delivery operations as its main driver, with the OD share for the segment increasing to 76%. Profitability was reduced by investments in product and customer experience to further strengthen our long-term business.

Now continuing with the Americas segment. We accelerated order growth by -- to 24% in Q4, reaching the milestone of 1 million average daily orders. GMV grew 17% year-on-year, slightly below order growth, even though basket sizes increased across most countries. This reflects the impact of reporting Argentina in euro even within a constant currency framework since Argentina qualifies as a hyperinflation country. Quick Commerce and our subscription offering continue to be key growth drivers, strengthening our value proposition across the Americas.

Revenue growth was further supported by the strong performance of AdTech, which outpaced the overall top line and still offers significant upside potential going forward. Adjusted EBITDA also improved materially in 2025, demonstrating the resilience of our business despite ongoing macro headwinds.

Now on to Integrated Verticals. Our integrated verticals business continued to deliver outstanding momentum, achieving 25% GMV growth year-on-year. This performance was especially strong in the MENA region where demand is exceptionally high.

Adjusted EBITDA improved markedly and reached breakeven for the full year 2025. This progress reflects our ongoing efforts to enhance the customer value proposition through broadening and strengthening the assortment to be more relevant as well as effective pricing strategies across our store portfolio. For the full year 2026, we expect a small positive adjusted EBITDA despite investments in our Dmarts expansion.

Besides the pure Dmarts business, also our local shop offering, which is actually included in the regional segments, continues to perform exceptionally well, supported by the onboarding of key partners like Jumbo in Argentina, Carrefour in Qatar, or KIKO Milano in UAE. Our combined Dmarts and local shop business collectively known as Quick Commerce has now surpassed EUR 7.5 billion in GMV, and we're on track to approach EUR 10 billion in full year 2026, underscoring the strength of the business model.

Let's now have a closer look at the gross profit margin. At the group level, our gross profit margin continued its upward trajectory, increasing by 10 basis points year-on-year to reach 8.3% of GMV, which is a new record high. Both MENA and Americas are already operating at strong and attractive GP margin levels. These regions are using their solid profitability as leverage to scale rapidly in the Quick Commerce space.

In Asia, gross profit margins also showed steady improvement, expanding sequentially by another 20 basis points in the fourth quarter of 2025, largely driven by stronger profitability in South Korea. Europe is gradually recovering from the temporary impact of the transition to the new rider model in Spain. With that adjustment now largely behind us, we anticipate further margin expansion as we move through fiscal year 2026.

Just as a reminder, as part of our continued efforts to streamline financial disclosures, starting in 2026, we will report gross profit only in accordance with IFRS and on a semiannual basis.

Up until the release of full year 2025 numbers, we have had 2 structurally different P&Ls for management reporting purposes and for IFRS reporting purposes. These differences draw significant manual reconciliation, limiting speed and transparency, while increasing risk across many levels. Hence, we harmonized the 2 P&Ls, and from 2026 onwards, we'll disclose slightly amended but fully aligned KPIs. This will accelerate our internal reporting cycles and provide great transparency and comparability of our profitability drivers for the financial community.

Let's now have a look at the affected KPIs. We're basically talking about 2 shifts. First, we will reflect revenue reductions, like vouchers or refunds, as a direct deduction from revenue. Instead of marketing expenses, thereby having the total segment revenues fully aligned with the IFRS revenue as published in our half year and annual reports.

Secondly, we will have certain cost reclassification within the P&L to ensure both reporting structures are fully synchronized. While this results in higher cost of sales and a lower reported gross profit, it reduces our other operating expenses, meaning this does not have any impact on adjusted EBITDA and free cash flow. Also, GMV and group revenues will remain unaffected by these changes.

Let's have a look at the upcoming dates. On 26 of March, we will publish our annual report 2025 and the full year 2025 earnings release, and also organize another analyst call. We will also give formal guidance for the full year 2026 that day. Until then, we would like to refer back to what we already stated in the Q3 trading update, namely that we expect moderate adjusted EBITDA growth for 2026 as we increase our investments in Talabat, Korea and Integrated Verticals. Without providing a specific outlook at this stage, we would characterize this as an adjusted EBITDA increase of up to a mid-single-digit percentage.

From a cash flow perspective, we anticipate that the business performance will continue to improve the underlying cash conversion. At the same time, we will see higher investments in our Dmarts business as previously communicated. With these opposing effects together, a free cash flow slightly above EUR 200 million appears to be a reasonable expectation for 2026.

Regarding the strategic review, we're carefully evaluating all relevant strategic options together with our advisers to unlock shareholder value. Given the nature and scope of the strategic options being evaluated, it is not in the best interest of the company and shareholders to give any interim details of discussions while they are underway. We will provide updates as soon as we are in a position to share details. Some options available to us may progress quickly, while others naturally require more time. Let me assure you that the organization is fully focused and working diligently across all work streams to assess every avenue to drive value for our shareholders.

One more heads-up we would like to give to today's audience. We are thrilled to announce that Andrea Ferraz will take on the newly created role of VP of Investor Relations and Corporate Communications. Andrea joins us from Klarna in March, and you will get to know her over the coming weeks.

That's it from my side. Thank you for listening, and we're now looking forward to taking your questions. Christoph?

Thank you very much, Marie-Anne. Before we enter the Q&A, I would kindly ask you to limit your questions to 1 panelist because this way we can ensure that every analyst has the opportunity to ask a question. And with this, operator, please go ahead.

[Operator Instructions] Our first question comes from Andrew Ross with Barclays.

Thanks for those comments on the outlook for '26 and strategic review. Given that I'm going to ask on Saudi, I ask if you can give a bit more color as to the changes that you've seen since the new regulation came into place at the end of last year.

So could you be more specific about where Hungerstation's market share is today versus where it was pre-Keeta launching in 2024? And how much have you been able to regain since those changes came into place? And then I guess the follow-up to that is kind of how you're thinking about regulation coming in through the rest of the GCC region in this year?

Andrew, so we don't really look at category share the way maybe you do. We rather focus on how we are growing. If someone gives out on EUR 600 million in vouchers, of course, we'll get a lot of orders. The question is what is the kind of long-term sustainable order level. So what is the true category share that such a player has, versus what is the temporary order growth that someone will generate.

Therefore, we don't really pay too much attention to that. We don't think it is that relevant. We try to look at underlying fundamental category share gains and losses. And the best way to do that is look at our own business and see how that is evolving and are we losing any of our customers.

We believe that the customers that we have, which we have gained over multiple number of years through aggressively pushing our service, whatever customer we didn't gain during that time period is probably not a very good customer. But of course, if someone offers $100 to order from SWAN, you will have a lot of riders and cleaning people and SWAN also ordering because it is simply free money to gain.

So coming back to that, like how does our business look and evolve? Well, first of all, we grew prior to Keeta entering, we grew at 15%. We obviously pushed a lot in Q4 that year when we launched, and we actually accelerated our growth 10% to 15%, I think 15% in Q4 2024. So that's why we have a pretty tough comp as we entered Q4.

Despite that, we managed to grow faster than 15% at the end of the year, so let's say, December here. So faster than 15% in December, and this trend continued into 2026. That means we are growing faster now than we did before Keeta entered the market in Saudi. And we have done that without any material downgrade to profitability. Our expectation is that we're going to grow in Saudi this year in terms of profitability. So overall, I think it's incredibly strong signals that we have there.

And we have achieved this not by doing massive discounts and vouchers and entered into the price war. And it's very easy to kind of get dragged into that. That's not what we have done. But we have actually rather focused on our best customer and continuously working on the service and the product offering that we give to them. And that's why we see that we haven't lost any of our good customers. The only customer that we have lost have been very low-quality voucher-driven customers. And therefore, we are incredibly excited about Saudi and, yes, we see a very good development for us.

When it comes to impact from regulatory, of course, if someone has to start making economics because you cannot do predatory pricing anymore, so therefore, you would see an impact. If someone starts adding different fees, they have to start charging restaurants, they have to start charging consumers and so on. So of course, it becomes a little bit more level playing field.

And of course, some of those, let's call it, fake customers or empty orders, those will disappear from those other platforms, which means that, technically speaking, yes, we will have gained share. But again, we don't consider it share gain when someone lost an order or a customer that wasn't really a true customer. So from that point on, we focus rather on our growth.

And outside of Saudi, I think the other markets have learned from the negative experience that Saudi had to go through that is hurting the restaurant ecosystem and many of the technology disruptors got disrupted. So I think the rest of Middle East learned from that experience and were much faster in applying and adopting predatory pricing practices, and that's what we also see then in the most of the markets that we operate. So in the majority of the markets in GCC have applied that. And yes, I think, overall, we view it pretty positively for the industry and the restaurants and the full ecosystem.

Our next question comes from Marcus Diebel with JPMorgan.

I guess I have a CFO question. Clearly, the free cash flow, EUR 200 million is a strong message. My question is how should we think about 2026 in terms of the cash flow? I think previously you commented that cash conversion should be better in '26 than '25. If I just say, okay, the sort of single-digit percentage growth, I mean, EBITDA gets us to roughly EUR 945 million.

Would you say we still have a sort of like EUR 600 million, EUR 700 million gap between EBITDA and cash flow? Or do we sort of like factor at least a meaningful improvement also in there? I appreciate it's not guidance time, but any sort of like conceptual help would be quite useful, I guess.

So I think I gave a bit of soft guidance already around that, right? And overall, I think we think a level above EUR 200 million is also what we would see for the current year.

And again, we can go into a bit more detail in about a month's time, right? But I think the way to think about it or the factors that would be driving it will continue to be some of what we've seen this year, right, which is to continue to actually work on, in particular, working capital improvements. I think we've done a lot already. We have improved tremendously in 2025, inventory management, in particular, cash conversion cycles in the Dmarts, we've been able to negotiate improved payment terms with payment service providers. We're monitoring payment cycles much more closely. So again, a lot of improvement has materialized already, but I think there's still more to do, right? So I think there's still some of that also happening or continuing to happen in 2026.

Obviously, any kind of overall improvement in the business will also translate into free cash flow. And I think then on the counter side, we obviously then also have investments that we've talked about, in particular, in the Quick Commerce segment, and that would then have obviously repercussions on the CapEx and the lease picture in particular, right? So I think you've got these 2 movements kind of maybe not fully offsetting each other, but I think leading to dynamic where you're probably looking at the numbers we so far gave for 2025 as well as 2026.

Yes. Okay. So basically, if you say EUR 945 million EBITDA, so the sort of incremental EBITDA should come through a better cash conversion than '25, or even better, let's call it like this?

Yes. But again, I mentioned other effects as well, right? The investments, I think, you have to factor in. So again, you have a number of moving pieces here. Some of them are -- will increase your cash flow. Others will slightly decrease it as we invest more. So I think there's a number of checks and balances here.

Our next question comes from Joe Barnet-Lamb with UBS.

Excellent. So you've spoken about the broadening out of your service and movement to being the Everyday App. You also specifically state your desire to raise Quick Commerce GMV to EUR 10 billion and to invest in IV. Can you give a little bit more color on IV? Can we expect it to remain breakeven with you investing incremental adjusted EBITDA into it? Or is it likely to get dragged back to negative adjusted EBITDA?

And sorry to push a little bit further on the cash conversion question, but it's sort of where partly where Marc was going, I think. Like are you going to expand your store footprint? And what's that going to mean for CapEx? A little bit of color around that would be helpful as well.

Maybe I'll start and you take then. Yes. So the plan is to -- and we've taken it to profitable, and we will maintain it there. But the growth that we're having is, of course, adding a lot of positive profit contribution. And that portion, the incremental profit contribution that has been generated will go back to expand and grow. But yes, we will keep it still around or slightly above EBITDA for 2026.

And then maybe you want to ask the cash flow conversion. Marie-Anne?

Yes, sure. So yes, I think the short answer is, yes, there is obviously plans to further invest in the business, in particular in the Middle East. And that means Dmarts additional ones or looking at expanding Dmarts at locations that are working very well.

So you will see additional investments and what that means for CapEx as you probably have a bit more of that. We also had some one-off effects in CapEx in '25 which you'll see a bit less of. We talked about Korea finishing some real estate projects there, right?

So again, I think overall, you will probably see CapEx going up a bit. And then I think the lease picture is obviously also important, right, as we expand the footprint of the Dmarts. So I think you should probably look at both of those increasing a bit.

Our next question comes from Luke Holbrook at Morgan Stanley.

I'm going to be the person that asks on your strategic review, just to try and get a little bit of sense here. Is everything on the table, small, medium, larger-sized geographies? And when you say the time line for some of these discussions might be shorter, some others longer, is those longer discussions still within the realms of 2026? I'm just trying to -- try to get more of a framing around how we think about that?

Yes. Very hard for us to comment much around here. As we said in our strategic review announcement, we are looking at a wide range of option. We basically look at everything, from -- without any -- from the ground up, putting it this way, to review what could be shareholder friendly. Based on that, we have also come to some assessment where we think there is value to be generated to shareholders. And we are working very hard and diligently through those potential options. Some of them will be fast to execute and not dependent on others. Others will take longer and/or dependent on others. So therefore, it's hard to give a specific time line on any announcement that will come there. But yes, we are taking a very deep look and we are looking at a wide range of potential options. And yes, that's what I can say.

Our next question comes from Giles Thorne with Jefferies.

Niklas, a question on your [indiscernible] Everyday App. Does it continue to exclude any services around mobility? Or is that something that you could see yourself leaning in harder on?

Giles, so it does not include it as for us building it. But we are, as you know, partnering in some locations and regions with existing ride-hailing companies, to see how we can benefit or how it can benefit our customers to have that as part of our subscription program and also have it integrated into our app, to cross-sell and leverage both our user base as well as improving the stickiness of our users.

We are still at, yes, somewhat early stage there to see how much we're expanding on this partnership, to what extent how much it adds value to our users and to us. But we have no plans to expand with our own business at the time.

And just by way of follow-up, the Bolt partnership in the GCC, in the UAE, how is that going? Is there any kind of color that you can share? I appreciate it's still pretty early doors, but any color on how that's going would be useful.

Yes. I think we do see -- we like the partnership. I think there is an argument for extending it or deepening some of these partnerships. I would still say it's -- it could be value accretive, but it's not a game changer. As I have maintained before, there is a clear value in having restrictions to what the brand stands for. Our brand stands for being the best delivery company. And of course, the more you expand into other areas, the more you dilute your message.

I want people to think about how do I get something delivered to me and not anything else. And I think that is also the benefit that we've had in many markets and against many players, that we are that focused and that we are also dedicating all our tech resources as one to building that. And there is a lot that needs to be built and improved still. So therefore, we also like to be focused when it comes to our resources on what we're building and what we spend for. But yes, I think there are also some encouraging signs, we see some value, but it's not a game changer yet.

Our next question comes from Annick Maas.

My question is on the AdTech business. Can you just explain us again, how much of the AdTech business is today contributing to profits? And with that, you are today already at 3% of GMV, you're now saying 4% of GMV is the long-term target. Why is that not higher? I think at some point in your history, you had a bit more ambitious targets here. Can you just explain us what is driving this?

Yes. So most of the revenue that we generate that goes to the bottom line, and increasingly so. So of course, in the beginning, when we sold ad products, we had to use sales team members. That is gradually being moved over to automated biddings and self-service, AI-generated sales agents to support. So we see that the margin on that revenue is increasing over time and will continue to increase.

In terms of our ambition, I think our ambition was 3% to 5% for a long time. Now we're saying above 4%. I think for the nonfood side, if you look at the groceries, and in particular, when you look at our own Dmarts, we think that level will be higher. So that's maybe what you're referring to.

There we see that we can grow substantially above 5%. We are still very early in that phase because we have been prioritizing more on the restaurant side given that it was a larger part of our business. But during [ '25 ] and even more so in '26, we are pushing the NMR revenue stream, so CPG companies and so on. And we think there's a lot of value and money that can be generated and improved there. But we're still very early in the stage.

But yes, here, we have bigger ambitions than that. Of course, you can look at things that, okay, if you make that margin that a big part of your profit is coming from there, and you see it as 2 businesses. But of course, it's not 2 businesses. If we would have less ad revenue, we would have to make more money on something else, then maybe we would have increasing our delivery fee or our commission or something else. Because in the end, we have a target on gross profit that we want to deliver. And of course, the more we can deliver through AdTech, the less we have to generate through other parts of the business. So we can charge less to users and so on.

So you can't see it as 2 different businesses, and that one is breakeven and one is making money, because we calibrate those together to making sure that we hit our target margins and target profitability. And you can't do one without the other either. I hope that answered.

Our next question comes from Silvia Cuneo with Deutsche Bank.

My question is on the guidance and the FX. Thanks for the color on the outlook for 2026 on the adjusted EBITDA growth front. I just wanted to check, because in the previous commentary around the Q3 stage, you referred to local currencies levels of growth in your message. So I wanted to check if what you commented about today, the up to mid-single-digit percentage growth in adjusted EBITDA is in reported terms for 2026, or is it not?

And related to that, if you could comment about the FX headwind that you currently foresee based on exchange rates at the moment?

Sure. Yes. So yes, so with the kind of soft guidance or indication we have today assumes the visibility we currently have on FX. And yes, so that basically is what we see at the moment.

I think overall, what we've obviously seen in 2025 is that FX had a very strong impact on our financials, and we talked about that a few times in previous trading updates, right, especially kind of after March 2025. And I think if I look at the overall impact on EBITDA that FX had at the end over the course of all of 2025, it's probably around EUR 100 million, maybe a little less, about EUR 90 million on free cash flow. So there was a very, very strong impact, which was obviously very hard to foresee.

I think where we stand right now in 2026, it's very hard to have a crystal ball. I think we don't see right now the same massive impact, but probably there will be some effect, right, and some slight headwind. So in terms of the outlook we're giving, it is currently based on current assumptions, right? And I think as we speak again in March, we would kind of further confirm that.

Our final question comes from Bharath Nagaraj from Cantor Fitzgerald.

How should we think about the timing lag between the higher investment that you're making and EBITDA inflection? Basically, does 2026 represent like a trough year for profitability?

Yes. So there are different types of investments. And you could make investments that would give an instant kind of almost return. For example, if you give a voucher, then very quickly we'll make back that money on that order, that voucher. But there's no long-term positive effect. If you buy a customer, it costs a lot more and it can take a multiyear to get that return back.

But of course, it is still a very good return from an IRR perspective even if it takes a multiyear. Same if we invest in technology, it will take time until you deliver that return or if you build a Dmart more, until you have building the volume and so on, it will be a longer payback period.

I think the investments that we have structurally done or want to do this year, in particular when we speak about Dmart in the Middle East is to strengthen in our service and operations, product offering and, in particular, with the Dmart in Integrated Verticals and multi-vertical, some of those have very long payback period, but they are, nevertheless, incredibly strong payback period.

So when we push multi-vertical, it will -- we will keep investing also next year, we will invest in expanding and improving our multi-vertical offering. Long term, we will have built a business that is worth in terms of billions probably in that space. But there will be also a number of years we'll keep investing in order to get that.

So even if the payback period is good, and it's still -- some of these investments will be multiyear investment. The same with Dmart. It took us -- we invested for 3, 4 something years. Now we have an incredibly strong business, but it was still an investment over a number of years until we start seeing a profit from that.

So it's a little bit hard to give you now an exact number. There will be returns of it already next year, but there will also be investments happening next year. So that's why you -- it would still be hard to look like-for-like what were the actual returns from the investment this year as they may continue.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Many thanks, everyone, for listening in and thanks also to all Heroes for your hard work. We are, as I've said, leaning in during 2026, and it will be an exceptional important year to deliver. So many thanks in advance for an even harder work during 2026. Thank you, everyone.

This concludes today's call. Thank you, everyone, for joining. You may now disconnect.

Welcome to the Delivery Hero Q3 2025 Trading Update. [Operator Instructions] I will now hand over to Christoph Bast, Head of Investor Relations, to begin the presentation.

Hello, and welcome, everyone. Thank you very much for joining our Q3 2025 earnings call. Joining me on this call today are Niklas Oestberg, CEO; and Marie-Anne Popp, CFO at Delivery Hero. And together, they will present the key highlights of our Q3 2025 results. Following the presentations, we will be delighted to address any questions you might have. And now over to you, Niklas.

Thank you, Christoph, and welcome, everyone, and thank you for listening in. We have a solid quarter behind us and enter Q4 with momentum. We have returned to order growth in Korea. We have excellent numbers in Saudi Arabia and very strong development in our multi-vertical offering. This current development gives us confidence to accelerate our strategy. We will be focusing our investments in 3 key areas: expanding our multi-vertical offering, enhancing our customer value proposition, invest in strategically important markets.

We are confident this is the right strategy to build on our momentum and drive sustainable long-term value. Later in the call, we will share more specific areas where we plan to lean in.

Now let's start with an update on our Global Technology platform, which represents our greatest strength and a key differentiator in our industry. What makes our global platform unique is that it is a single unified platform across 65 countries, exactly like Uber Eats or DoorDash with the important difference that we have enabled deeper localization for multiple brands across all verticals. This platform provides world-class logistics, AdTech, customer service, AI personalization, search, payments, quick commerce, partner integrations and much more.

Last quarter, we finished the integration of Glovo, demonstrating the power of our platform with significant operational improvements reflected in a better customer experience, increased delivery efficiency and a stronger advertisement business. With the ongoing integration of Uber, we are working on the integration of the last brand to our global platform. The first regions in South Korea have already been migrated with promising results such as significantly increasing the numbers of deliveries per rider per hour while still delivering slightly faster, which point to significant delivery efficiencies that leads to higher rider earnings while also lowering cost for us and vendors.

While business enablers are fully globalized, our global platform also allows for unprecedented deep localization of the customer experience. This enables us to fully embrace uniquely local customer preferences without any global one-size fits all compromises, leveraging our leading local heritage brands much better and faster than our competitors.

To give you some examples, we are offering a fully customized Ramadan experience in MENA, curbside pickup in KSA, special student discounts in Greece, a customer loyalty program in Turkey, group ordering in APAC and so much more. It is this unique combination of fully globalized business enablers and deep localization of customer experience that is the heart of our platform's comparative edge.

Another pillar of competitiveness that we have been building for some time is AI personalization. We firmly believe in end-to-end personalization. We want to offer a customer experience that is individually optimized and curated for each specific customer, those becoming much more relevant, inspiring and engaging than any unpersonalized experience.

Over the last 2 years, we have developed a proprietary global AI personalization platform that leverages state-of-the-art AI algorithms to process all of customer vendor and product information, continuously learn how to personalize the experience for each individual customer. With millions of customers in around 65 countries, every day, this platform processes more than 10 trillion features. The result is that all relevant aspects of our customer journey in our apps are becoming personalized. That goes for search results, recommendations, deals and promotions, ads, delivery fees, vendor and product lists and so much more.

This end-to-end AI personalization of the customer experience leads to significantly increased conversion rates, higher average order volumes and improved customer lifetime values. But the deployment of AI has also been impactful when it comes to cost. If we move to the next page, here, we can see that we are laser focused on improving our operational leverage by increasing efficiency through deploying AI automation. It's fully integrated throughout our business and constantly improving our performance. Over time, we have reduced SG&A and marketing costs as a percentage of GMV from 7.2% in Q1 2023 to 6.0% in Q3 2025, reflecting measurable efficiencies and smarter marketing spend.

Looking at the ratio G&A, including research and development costs to GMV, we are now world-leading in our peer group. This improvement is supported by our AI and automation road map, which began in 2023 with self-service for customers, vendors and riders. In 2024, we introduced copilots for service agents and productized incentives. By end of 2025, we will have implemented vendor-funded deal optimization and AI content optimization. And finally, in 2026, we will focus on agentic services and sales, along with AI-driven incentive optimizations. These steps position us for sustained margin expansion through automation and personalization.

Let me now hand over to Marie-Anne, who will guide us through the financial highlights.

Thank you, Niklas, and a warm welcome from my side as well. Q3 2025 was a strong quarter with continuous growth in our 3 main focus areas: growth, profitability and cash generation despite tough comparables. GMV in Q3 increased by 7% year-over-year on a like-for-like basis and excluding hyperinflation and FX effects. The slightly softer growth in Q3 was due to a strong Q3 last year following growth initiatives in South Korea and MENA. However, the GMV development is set to accelerate again in Q4, driven by Asia's recovery and robust demand across key markets.

Revenue generated a plus of 22% year-over-year on a like-for-like basis, growing again markedly faster than GMV. In addition to the top line, adjusted EBITDA in Q3 2025 further increased, driven by stable GP margin as well as strong cost discipline. Free cash flow continued to improve in Q3 2025 and is well on track to meet the full year guidance of exceeding EUR 120 million. Our capital position remains strong with EUR 2.2 billion in cash at the end of Q3 2025, reflecting the convertible bond buyback of nearly EUR 900 million earlier this year and the net outflow for extraordinary items of around EUR 500 million during the first 9 months.

Let us now take a closer look at the individual building blocks of the Q3 performance. As of this quarter, we will show order growth on a group level. In Q3, orders grew by 8% on a like-for-like basis with double-digit growth in all segments outside of Asia outperforming GMV development. As mentioned, GMV growth for Q3 reached 7% on a like-for-like basis in constant currency and excluding hyperinflation accounting. The slight deceleration compared to Q2 can be traced back to strong comparables following free subscription trial in South Korea and growth initiatives in MENA.

In Q4, growth is expected to pick up again, driven by Asia's return to growth. Revenue growth came in at 22% and have consistently exceeded 20% at the group level for several consecutive quarters. The strong growth was driven by the ongoing expansion of own delivery logistics, especially in South Korea and Turkey as well as the change in the rider model in Spain. Furthermore, the continued strong performance of our AdTech business as well as the attractiveness of our Subscription programs have contributed to this development.

Let's now dive into the Europe segment, where we temporarily scaled back GMV growth to manage the initial efficiency impact following the transition to an employment model in Spain. Performance outside of Spain remains strong with category share gains as well as healthy GMV growth in the majority of markets. Revenue growth in the Europe segment was driven by the expansion of our own-delivery logistics with OD's share increasing by 8 percentage points year-over-year to reach 82% in Q3 2025.

Furthermore, the introduction of the new rider model in Spain and the associated change in revenue recognition resulted in a higher take rate. In addition, we successfully adjusted the rider model in Italy in line with new regulations and completed the global transition to Delivery Hero's tech stack, resulting in improved delivery times, lower failure rates and higher operational efficiency. We maintain a strong profitability outlook with adjusted EBITDA expected to reach near breakeven in Q4 2025.

Let's move on to MENA. We delivered very robust GMV growth despite challenging prior year comparables, which had benefited from heightened growth investments. Our competitive playbook in Saudi Arabia has worked out very well. We see strong performance with a significant outperformance versus local peers. More on this later on.

Talabat sustained strong performance with GMV growth of 27% year-over-year in Q3 2025, driven by order volume growth across markets and verticals and supported by highly effective partner-funded savings, which reinforce a unique competitive advantage. In addition, the multi-vertical offering continues to thrive with over 70% of the GMV now being generated from customers who order food and groceries.

Furthermore, talabat's loyalty program continues to grow and the share of GMV generated by subscribers is now accounting for nearly 50%. With the increased competitive environment, we aim to apply a similar competitive playbook as in Hong Kong and Saudi Arabia by making some incremental investments into our service offering. We also believe that the regulatory environment in the MENA region addressing predatory pricing is moving in a positive direction. Turkey significantly improved profitability through a strong increase of vendor-funded deals and gross profit improvements. This led to positive adjusted EBITDA in Q3 2025 with further earnings growth expected in Q4 2025.

Now on to the Asia segment. For Asia, the picture is slightly mixed. GMV trends in Korea were constrained by high comps in Q3 2024, given a full quarter of free delivery and free subscription trial. However, both the subscriber order share as well as subscriber frequency continues to increase at double-digit rates. For the remaining part of Asia, we have seen a strong growth trajectory across the region, with Hong Kong being a large outperformer with elevated growth levels. Today, we're significantly larger than when competition started to heat up 2 years ago.

Moving on to revenue. In line with previous quarters, the ongoing robust revenue growth of 17% on a like-for-like basis was primarily driven by the rollout of own-delivery operations, which now account for 75% of orders in the Asia segment, an increase of 18 percentage points. Adjusted EBITDA in the Asia segment continued to grow year-over-year in Q3 2025. As you might recall, our operations outside of Korea under the foodpanda brand have been generating positive adjusted EBITDA before group costs already for several consecutive quarters, and we saw further margin expansion in Q3.

Looking forward, the Asia segment had a strong start into the fourth quarter. With a number of orders in Korea returning to growth during October and trends further improving in early November, it is setting the stage for overall GMV growth in the Asia segment in Q4 on a like-for-like and constant currency basis.

Now continuing with the Americas segment. The top line development again highlights the sustained momentum we have in this region with GMV growing 19% year-over-year, driven by 21% order growth from both new user acquisition and increased order frequency. We continue to expand our Quick Commerce and Subscription offerings to reinforce our value proposition by driving deeper customer engagement and broadening our multi-category offerings. Revenues in this segment grew 19% year-over-year in the third quarter with AdTech outperforming the overall top line growth and offering additional upside potential going forward.

As profitability continues to improve, the Americas segment is demonstrating resilience amid current macro headwinds like currency devaluations in some of the segment's countries with adjusted EBITDA continuing to expand year-over-year during the last quarter.

Now on to Integrated Verticals. Our Quick Commerce business continues its rapid expansion, fueled by 24% year-over-year growth in Dmarts and even faster growth in local shops, boosting annualized GMV to more than EUR 7 billion. Overall, the Integrated Verticals segment significantly enhanced its profitability, achieving its first ever positive quarterly adjusted EBITDA in Q3 2025. The business remains on track to achieve adjusted EBITDA breakeven for the full financial year 2025. We're big believers in this segment. And in 2026, we aim to add more stores and reinvest incremental profit contribution to drive customer experience further.

Let's now have a closer look at the gross profit margin development on group level. Overall, our gross profit margin on group level continued to increase by 40 basis points year-over-year to 8.0%, primarily driven by better margins in Korea and the scaling of the Integrated Verticals segment. Assuming the elevated competitive environment persists, we might consider to keep our gross profit margin flat during 2026 and to expand margins as and when the competitive environment eases.

Our MENA and Americas segments are already achieving an attractive gross profit margin of around 10%, while leveraging profitability further to expand rapidly in the quick commerce space. Gross profit margins for the Asia segment continued to improve with an expansion of 90 basis points year-over-year in the third quarter of 2025. This was mainly driven by improved unit economics within our own-delivery business. The quarter-over-quarter decline is primarily due to the monsoon season in Southeast Asia, leading to temporarily elevated delivery costs in line with our planning.

The Europe segment faced a temporary negative impact due to the rider model transition in Spain, which led to short-term elevated delivery costs, but has started to show gradual recovery. Further margin expansion for this segment is anticipated in the fourth quarter. As part of our continued efforts to streamline financial disclosures, starting 2026, we will report gross profit only in accordance with IFRS and on a semiannual basis.

Niklas will now take you through our case studies on Korea and Saudi Arabia.

Thank you, Marie-Anne. As you're aware, we made substantial improvements to our South Korean business over the past 18 months with a clear focus on enhancing the customer experience and returning to a growth trajectory. We improved our logistics capabilities, introduced our subscription program, simplified platform architecture, several product innovations and drove UI improvements. All in all, we had to make some radical changes in the past 18 months, and I'm very, very pleased to see these efforts bearing fruits.

On the left-hand side, you will see order development presented as a 14-day trailing average growth rate. Based on this, we have seen an uptick in order volumes returning to year-on-year growth during October and early November, while maintaining stable category share. We remain on track to reach growth for the quarter. We now know that our growth playbook works and growth will remain our priority in 2026. As a result, we would expect to maintain adjusted EBITDA around current levels in local currencies.

We feel confident in doing these investments as we see clear tangible results. Some examples of those. We introduced and expanded our offering for low-frequency users, new users and churn users, which led to new acquisitions going up by 8% year-on-year and 25% quarter-on-quarter as well as reacquisitions up 12% year-on-year. Our subscription program, we continuously enhance our value proposition through new products like Meal for One and partnerships with [indiscernible] and YouTube, which are extremely popular in South Korea. Around 80% of Koreans use them regularly. As a result, the number of subscribers doubled year-on-year with 30% increase in order frequency since the beginning of the year.

Delivery Experience, own-delivery service share increased by 30 percentage points year-on-year, of which we have begun to see the positive impacts of. This was only possible as we made significant improvement in economics over the past 18 months.

Let's have a closer look at Saudi Arabia. So what you can see is Saudi Arabia exhibits a very resilient customer base despite increasing competition. The order growth increased by around 15% before and 14% after the Keeta entry 1 year ago, reaching now almost 50 million orders per quarter. The customer mix continues to improve with the number of high-frequency customers growing the fastest at 19% and medium frequency and low-frequency customers growing at 10%, all of which exceeds last year's growth rates. Growth is driven by a very strong product offering, which is much larger than just food.

Quick Commerce customers' adoption went up 1.5x year-on-year and the share of quick commerce as a percentage of GMV doubled year-to-date with a huge upside potential going forward. We have also seen Subscription adoption triple year-on-year, supported by multiple new initiatives like attractive discounts on the top 3 items, reduced delivery fee, pickup, Meal for One or our loyalty program. Subscribers now account for 39% of GMV with further room to grow. Current growth has come with some incremental investments, and we will maintain these investments during 2026.

With this, Marie-Anne will now take us through our guidance.

Following the solid results in Q3, we're confirming our 2025 guidance, which was updated during the last trading update. We continue to expect GMV growth to come in at the upper end of the 8% to 10% growth range year-over-year and on a like-for-like basis. Total segment revenue growth was upgraded to 22% to 24% on a like-for-like basis, and we continue to see it in that range for the full financial year 2025.

The adjusted EBITDA result is expected to come in between EUR 900 million and EUR 940 million, in line with what we communicated in August during Q2 results. This includes around EUR 110 million of FX headwind coming from the second half of the year. Excluding this negative impact, adjusted EBITDA would be expected to come in somewhere between EUR 1.01 billion and EUR 1.05 billion based on FX at the time of initial guidance from February 2025. Lastly, we continue to expect free cash flow to be more than EUR 120 million, including the previously communicated negative FX headwind of around EUR 80 million.

That's it from my side. Thank you for listening, and we're now looking forward to taking your questions. Christoph?

Thank you very much, Marie-Anne. [Operator Instructions] Operator, please go ahead.

[Operator Instructions]

Our first question will come from Jo Barnet-Lamb with UBS.

So Niklas, you spoke about leaning in to accelerate your strategy and touched on some really interesting initiatives. You also dropped a few comments about ongoing investment in a number of regions. I'm wondering if this points to heightened investment into 2026. So could you talk a little bit about what these initiatives might mean in aggregate for 2026? And perhaps any color you can give us on adjusted EBITDA at the group level for next year?

Thanks, Jo. So at this stage, we are not ready to give next year's guidance. We typically provide that -- our guidance in Q1. Having said that, as we mentioned in our prepared remarks, we are making some investment next year, such that continue investing in improving growth initiatives in Korea, investments to push customer experience in UCC to maintain customer loyalty, multi-vertical offering is another one and in particular, Dmart efforts.

And I would say, despite this and the elevated competition that we're seeing, we still expect to deliver both top line growth and moderate bottom line growth next year while further improving cash conversion. We believe -- or I believe that this indicates the fundamental strength and resilience of our business model and our team's ability to execute.

Our next question comes from Luke Holbrook with Morgan Stanley.

It would just be on Slide 18, the order trajectory in South Korea. There seems to be a bit of a dip in that growth rate towards the end of October. It then suddenly reaccelerates. So I'm just wondering if you could provide a bit more color on whether that's a function of more promotional campaigns and timing of that? Is it a function of comps? And then just how we think about that trajectory as we go through Q4?

Thank you. So -- sometimes this can be that there is an extra holiday or something like that. So I can't remember what it was exactly. I know we're speaking about it came down 1% or 2%, but it's often just 1 day that some special event. Again, I can't remember exactly what it was. You would expect it to continue at this current level or maybe even come up a little bit during end of November, possibly also beginning of December. It might come down a little bit from mid-December again as we did some big push last year during end of December, early January. But yes, the direction is clear and it's upwards.

Our next question comes from Marcus Diebel with JPMorgan.

Similar on Korea question, I mean, the roughly 2%, 3% that you're seeing, could you help us maybe understand conceptually what it means sort of like longer term? Do you think there are some elements of sort of like initial one-off effects? Obviously, you've done a lot, as you said, in Korea. But do you think sort of like this is just about to start and we should assume at least conceptually a higher number than the 2%, 3% that we just saw in recent weeks. That is my main question.

My half a question as you reflected is just a follow-up on Jo. You said the EBITDA is going to grow at a moderate level. I didn't fully catch that. Was that meant for just Korea? Or was that meant for the group? Sorry for being ignorant, but it's obviously important. I just wanted to make it clear?

Yes. So on the first one, there is no one-off effect to certain special things that we do. Of course, we continue to do promotions with our partner, certain vendor-funded deals. That's an ongoing thing that will also be there in '26 and beyond. So I don't think there's anything out of the extraordinary there. So it's just hard work over a long time that is bearing fruits. And as I said, we will keep leaning in, in Korea and prioritizing growth for next year. So we will continue on that direction. There will always be a month here and there where things can go a little bit up or down. That's normal, but the direction is clear, and we will keep driving that.

Yes, my view is more on an aggregated base for Delivery Hero. As mentioned, we are -- we are leaning in a little bit more in Korea, but we're also leaning in a little bit more in GCC, where we really want to protect the customer experience and maintain the customer loyalty that we have. You also see that multi-vertical, as Marie-Anne mentioned, is an area that we truly believe in that makes us very unique and that is significantly improving the customer experience for our customers where we offer that. And these are the things that really makes us unique and why we can fight back so good when we compete against player who spends hundreds and hundreds of millions, and it still doesn't impact our customer base. So we'll keep leaning in on those things and drive that customer experience because we think that is the cheapest way of maintaining share.

But that also means that there are certain investments next year. And I would say, despite this elevated competition and despite the investment we're doing, we are still going to deliver at least a moderate bottom line growth in -- on the bottom line while also growing the top line. But yes, that's an aggregate, I would say.

Okay. I would like to ask you what moderate means, but I'm sure that's difficult.

Look, I don't have a number for what moderate is, but I would say moderate is more than stable or flat, putting it this way.

Our next question comes from Andrew Ross with Barclays.

[Technical Difficulty]

Andrew, really hard to hear you. Sorry.

Andrew, there seems to be some connection issues.

Operator, can we just move on with the next analyst and then we try Andrew after again...

Is that better now?

Now, we can hear you. Go ahead. Andrew, you're still there?

Our next question will come from Giles Thorne with Jefferies.

Look, I think Andrew's first question, I'll ask it. Was just category share for Hungerstation today versus where it was a year ago. I'm sure he'll come back around again, but I certainly heard that much. So if you could answer that.

And then my question was also on Saudi Arabia, and it would be useful to know what the contribution margin is looking like on orders at the moment. The order growth that you're reporting certainly looks very impressive, but it would be useful to know to what extent it's a tailwind or a headwind to EBITDA?

Thanks, we are not looking that much into category share, at least not in this like super promotional case where every cleaner and rider is getting money to feed their families. It's a little bit irrelevant. What matters is what is the category share of actual orders that would have happened without promotion. And there, we would have to make a lot of calculation to get there, and it gets very complicated. But measuring category share when someone is buying orders is a little bit irrelevant.

And also what we are focusing on, and I think way more important is like are we losing any of our customers, and if we're losing any of our customers, who are those customers? And do we lose them for one order or do we lose them for many orders. And as you have seen there in the slides, we maintain our best users. We keep growing our best users. There is a little bit of churn on low customer orders or low-value customers. I think you have also seen from some of our local peers actually have a decline. So I do think that we have a stronger loyalty in our product and service than what you have seen in the local peers and possibly also some additional investments we have done in our product offering.

So yes -- so based on that, we feel very comfortable. We feel very good. We are growing. And yes, customers are loyal to us. I think we see a little bit similar even more so in Hong Kong. We took a big dip in the first 12 months -- 6 to 12 months where we lost a lot of low-value users. Year 2 was improving. So we start -- and we can only lose a customer once. So that's good. So that we start seeing stabilization. In year 2, we have seen rapid growth. And right now, it's one of our fastest-growing market. As Marie-Anne said, it's significantly larger now than when Keeta entered. So that makes us also comfortable for Saudi Arabia for the next year or 2.

But yes, initially, it means some incremental investment. It still means that our margins are good in Saudi. Maybe we took down margins a little bit, but also thanks to growth, it means that EBITDA was maintained more or less stable last year. So yes, I hope that helped a little bit to answer the question.

Yes. And then on the contribution margin, please, that you're seeing currently in Saudi Arabia?

Yes, it remains good. So it's roughly in line, a little bit lower than what it was pre as we are making a few investments in a few areas also on the consumer side. But it's fairly small difference. So most of our investments has not necessarily been on that or being compensated other way. So it's a small margin reduction, but thanks to growth, overall EBITDA is roughly stable -- marginally down, but fairly stable, I would say.

And just a follow-up, and I appreciate that's question #3, but one of them was Andrew's. Just to follow up, we're now quite deep into the Meituan phenomenon. Do you think the body of evidence, Niklas, supports the idea that as long as you have product parity or product leadership against Keeta, the investment that they're putting in is effectively accelerating changes in consumer behavior. And as an incumbent, with product parity or product leadership, you actually benefit from that long term? Or is the jury still out on that idea?

I don't want to be too optimistic here. But I think there is a clear argument also if you look at Hong Kong and we look at Turkey and some other places, that you are taking a hit short term because you're losing some of your least valuable customers. And that means also -- that helps your gross profit. So to your earlier point, it actually helps our gross profit that we actually also then reinvested in some high-value customer to make sure that we keep loyalty there.

So as long as we have a strong product offering, and I think we do, I think we have a substantially better product offering than all other players in the region. And we are no longer just a food delivery company. So I don't think that we necessarily compete head-to-head. I think there is a valid argument to make that those customers who got -- who are low-value customer, maybe even some other customers who got hooked by delivery will become real customers. And once this kind of initial voucher spend is kind of phased away, some of those customers will come back, and you will have a little bit of a tailwind over time.

But again, let's not be overoptimistic. We have a good development. We'll keep that good development. If there is some tailwind in 2 or 3 years or maybe 1 or 2 years, that's great, but let's not bank it in yet.

Our next question will come from Monique Pollard with Citi.

The question I have was just on Korea. So your own-delivery share, you're seeing now of orders is up 30% year-on-year. So am I right in thinking about 3/4 of your orders now in Korea are own-delivery? And just a follow-on, I guess, if the rest of Asia GMV was growing 8% like-for-like in the third quarter, we can see kind of low single digit so far in Korea. So mid-single-digit growth, is that reasonable for GMV as we go into the fourth quarter?

I don't know what we disclose exactly on this other part of Asia, but I think your assumptions are sensible. And as we mentioned already in Q2, Q3 was a very tough comp for Korea, given that we did free delivery for everyone regardless if we had a subscription or not. We had free subscription effectively. So that's also why we've seen a kind of return to growth as we have an easier comp as we come into Q4 and going forward effectively.

So the fact that we're growing now is not that we're doing a lot of activities in Q4. It's actually all the work that we've done in the last 12 months, building subscription program, innovating, UI improvements, logistic improvement, moving OD to roughly what you said 3 quarters. So yes, but I think your assumption is fair. And we also expect that to grow. APAC is doing very well, both on top and on bottom line.

Our next question comes from Silvia Cuneo with Deutsche Bank. Can you hear me?

I have a question on take rates. In MENA, GMV growth was largely in line with revenue growth in Q3. And given the planned investments to respond to competition that you mentioned, should we expect this to potentially lead to a lower take rate and therefore, lower revenue growth and GMV potentially next year? Or can you counterbalance these perhaps with an increase on delivery-share, if possible? And then similarly related to this also in Americas, we noticed steady take rates. And just wanted to ask if this is instead driven by perhaps the multi-category effect to the mix?

Yes. So we don't go into details on how take rate evolves, and we are a little bit more focused on gross profit. So I can't fully answer that question. But I think it's -- as I said before, with Hungerstation and the playbook we have that is very strong. We lost some low-value customers that actually lost money per order, so negative unit economics to GMV. We use some of that money to find strong, loyal, good customers closer to us. Net-net, there was still maybe a slight gross profit reduction. But thanks to the growth, the effective EBITDA was flat to slight down or slightly down.

And for talabat, I don't want to guide for them, but you should expect something similar that in the markets where they compete aggressively, there might be a slight gross profit reduction net-net. But as they are growing, that also means that, yes, the total impact on EBITDA is -- I think it's fair to assume that is -- yes, I think we should be happy if it's a flat to maybe slightly upwards next year. I think that will be a great performance. When it comes to Americas, yes, stable take rate, stable gross profit is what -- yes, we are happy where we are right now. We don't intend to increase it next year.

Our next question will come from Jurgen Kolb with Kepler Cheuvreux.

Fantastic. Two -- 1.5 questions. First of all, you mentioned this moderate EBITDA growth for potentially 2026. At the same time, you're trying to improve the cash conversion. I was just wondering if we have to maybe look at some of the building blocks that increase the cash conversion. Are we talking about maybe lower CapEx? Is there anything there going on with any of the other drivers to the bottom line of the cash flow that we should be aware of? First one. And the half one is basically housekeeping. Can you remind us what kind of special cash out we had in Q4, so to reconcile the cash performance from the EUR 2.8 billion, I think it was in H1 to the EUR 2.2 billion in -- or after 9 months?

Sure. So to your question on cash generation and cash conversion, I think, in fact, the biggest driver of our free cash flow is our EBITDA performance, right? So I think that remains very much the place where we draw improvements in free cash flow from, right, as a basis. And then looking at the individual lines and that go from EBITDA to free cash flow, I would say there is nothing unusual there right now to be expected.

I think as we talk about investments, in particular, on the Quick Commerce side, obviously, you will continue to see CapEx there, right? So we will continue to have CapEx investments for sure. We'll continue to have lease expenses going through this as well as we invest in some of our Quick Commerce operations. And I think across all the other lines, you might have a small increase on taxation as more markets reach profitability. I think on the financing, there's nothing there. I think you basically mostly deduct the free cash flow improvement and conversion from the operational performance.

Maybe some of the entities that are also increasing its profitability will also have some losses carry forward. So a small item there. One thing that Marie-Anne didn't mention, but she and her team, including myself, also pushing very hard on working capital when it comes to retail. So when it comes to Dmarts and so on. Everyone who knows retail is that it's all about cash flow. So extending payment terms, improving your turnaround of your stock inventory and not holding the stock more than -- we have a very strict guidelines how fast we should get it out of the stores. And so we continue to see increased working capital in our Dmarts, in particular. So that is also helpful.

And sorry, the Q3, any specific cash out to reconcile EUR 2.8 billion to EUR 2.2 billion, as you're looking to EUR 450 million?

Well, the main cash outs you will have seen this year, a lot of them were obviously in Q1 related to buying back convertible bonds, to having the breakup from Taiwan coming in. What you see in the second half of the year and some of that in Q3 is obviously the payment of the Atomium fine, which I think we talked about in August, and it was -- at that time was literally imminent. So that's happened for EUR 328 million.

And then we also discussed at that point in time, Spain, where we were expecting about EUR 450 million of payments related to the rider model, right? And that's come through to the large degree. And that's maybe a place where we expect a little bit more as well, maybe EUR 100 million more or so over the next months, but the timing of that is a bit going into Q4 and beyond as well. So that will be the main building blocks of the, let's say, the nonoperating cash elements.

Our last question will come from Jo Barnet-Lamb with UBS.

Excellent. I'm going to follow up on my own question earlier, if that's okay. Just thinking about how you're able to keep growing profitability despite substantial reinvestment. And it draws me to a question on Korea. Your OD penetration in Korea has increased substantially, as Monique referenced. We know that OD margins in Korea have been below marketplace margins but improving rapidly. As such, Korean profitability has been working against both FX headwinds, but also blend headwinds throughout 2025. So how materially different are Korean OD margins versus marketplace today? How materially have they improved? And what does that all sort of mean for Korean profits into 2026?

Thanks. There are many things at play there. So when you look at, OD margin is lower than the NP margin still. It's improving, but it's still lower and in particular, for subscribers because it's free delivery versus for nonsubscriber it's a better economics for our OD than for our marketplace. So therefore, you have both the difference in marketplace OD and you have the increase in subscription and you have the increased margin that we continuously work on that will continue to improve. So all this together makes kind of the average gross profit. And we don't guide now overall on every single line items or anything.

But as I mentioned before, taking it all in together, we want to prioritize growth. We are on a good journey. We know exactly what needs to happen and what need to do and what are the growth levers and that's what we're prioritizing for next year. And that means that, yes, next year, it's fair to assume that it's a flat development on EBITDA in local currency. Then what happened in local currency, that's another topic.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Yes. Thank you very much, everyone, for listening in and in particular, all heroes for your very hard work. We are now having great momentum, and I'm very excited about the plans for 2026 and beyond. So thank you, everyone.

This concludes today's call. Thank you, everyone, for joining. You may now disconnect.

Welcome to the Delivery Hero Q2 2025 Trading Update. Today's presentation will be followed by a Q&A session. [Operator Instructions].

I will now hand over to Christoph Bast, Head of Investor Relations at Delivery Hero to begin the presentation.

Hello, and welcome, everyone. Thank you very much for joining our Q2 2025 earnings call. Joining me on this call today are Niklas Oestberg, CEO; and Marie-Anne Popp, CFO at Delivery Hero. And together, they will present the key highlights of our Q2 2025 results and the performance of the first half of 2025. Following the presentation, we will be delighted to address any questions you might have.

Now over to you, Niklas.

Thanks, Christoph, and hey, everyone, and thank you for tuning in. We are starting with updates on our global technology platform as it's our #1 strength and huge competitive advantage. It's a unified global tech platform across all verticals. What's unique is the deep localization of the customer experience allowing us to adapt to local customer preferences and to fully leverage our local leading heritage brands, much better and faster than our competitors.

In Q2, our platform reached an important milestone. Glovo is now end-to-end integrated, and the migration is completed. This also means we have reached full integration across all our brands and markets, except for Korea, where the integration is on track, but not yet completed. The integration of Glovo provides an interesting case study that demonstrates the power of our platform comparing performance across different KPIs.

Before and after the integration, we see that our platform unlocks significant operational improvements, ranging from customer experience, example here, 6.7% conversion rate improvement and 9.8% late -- less late orders. To deliver efficiencies, example here, 9.5% reduction in cost per order, a very key metric and service improvement with 10.7% less or more self-service. It also gives us more ad revenue as another example, which was then up 29% with this migration.

We are also excited to provide a sneak peek into Woowa integration, which is currently still ongoing, as previously mentioned. One of our largest components is the global logistic stack, which is now live in the first regions in Korea. And we see that we can significantly increase the number of deliveries per hour -- per rider per hour. So that's an 18% increase in utilization rate, which is a huge implication on the cost side. We have done this while still delivering slightly faster, so 2.4% lower delivery times than before the integration. This points to significant delivery cost savings potential for the future.

In addition, we are approaching another milestone, and we go to the next slide. And here, you can see that soon, half of our GMV will come from customers who are using multi verticals on our platform. When we double down on becoming a multi-vertical platform 6, 7 years ago, it was nothing but clear that this would become a huge success. Today, we can truly say that we have transformed from a food delivery company into a multi-vertical platform with stronger engagement and higher spend.

The driver is a powerful frequency flywheel. It's each new use case, not only adds incremental usage, but also amplifies activity in existing verticals. Multi-vertical customers now spend 5.2x more than single vertical customers, a clear proof point of our platform's impact. We will keep scaling this opportunity by expanding vertical coverage and offering great selection affordability and experience across all verticals. This not only opens up a huge TAM, but it also makes us less vulnerable to competition in one or another vertical. Today, we believe we are less than 1% of the total TAM opportunity.

Let me now hand over to Marie-Anne, who will guide us through the financial highlights.

Thank you, Niklas, and a warm welcome from my side as well. So Q2 2025 was another strong quarter, marked by continuous improvement in our 3 main KPIs, both profitability and cash generation. GMV in Q2 increased by 11% year-over-year on a like-for-like basis and excluding hyperinflation FX effects, which represents a slight acceleration compared to the previous quarter. The driver to the acceleration came from our Asia segment. Revenue generated a plus of 27% year-on-year on a like-for-like basis, continuing the trend of the last quarters and growing faster than GMV. In addition to the top line, the bottom line also grew substantially.

Adjusted EBITDA in the first half of the year increased by 71% to EUR 411 million, representing a margin expansion of 70 basis points compared to the prior year period. The FX headwind in H2 is expected to be materially larger than in H1, which we will outline in our outlook. Free cash flow before extraordinary items also improved significantly, almost reaching positive territory with minus EUR 8 million in the first half of the year.

Here, I would like to point out that the Taiwan breakup fee of EUR 212 million is excluded. Free cash flow after extraordinary items even amounted to EUR 165 million. We will go into the exact reconciliation later. Our capital position remains strong with EUR 2.8 billion in cash at the end of H1. This already reflects the repurchase of nearly EUR 900 million in convertible bonds during the first half of the year.

Let us now take a closer look at the individual building blocks of the Q2 performance. As just mentioned, GMV growth accelerated for the second consecutive quarter, reaching 11% in Q2. Figures shown in green reflect performance on a like-for-like basis in constant currency and excluding hyperinflation accounting. A key driver of this positive development is a significantly improved growth momentum in Asia. This growth is driven by a rising customer base, combined with a steadily improving customer experience.

With an expanding selection of restaurants and shops and the rollout of our multi-vertical offering, we're creating more shopping opportunities for our users. In addition, continuous improvements to our delivery service and the ongoing enhancement of our subscription model are increasing the attractiveness of our platform, resulting in higher order frequency and larger basket sizes for the majority of our business.

Revenue growth continues to build on the strong GMV momentum and has consistently exceeded 20% at the group level for several consecutive quarters. In Q2, revenue growth accelerated further reaching 27%.

Moving on to adjusted EBITDA. As mentioned already earlier, we delivered strong progress in profitability in H1 with adjusted EBITDA increasing by 71% year-on-year to EUR 411 million, implying a margin expansion of 70 basis points. Besides the increase in gross profit, this was also achieved through operating leverage. Given enhanced marketing efficiency, reduced IT expenditures and lower personnel expenses we managed to further optimize our operating expenditure in H1 2025.

Overall, adjusted EBITDA continues to follow the trajectory we set some time ago. Since the first half of 2021, our EBITDA margin has expanded by approximately 440 basis points, while we have consistently invested in growth initiatives, product development and technology as well as reinforcing our operations in highly competitive markets.

I'm also pleased to share that we have reached breakeven at the EBIT level after accounting for share-based compensation and management adjustments. We narrowly missed positive free cash flow by just a few million euros, but it has improved significantly compared to the previous year and is expected to turn clearly positive in the second half of the year.

Let's now turn to the business development on segment level. Let's now dive into the Europe segment where we see a continuation of the strong growth trajectory, again outperforming major European peers. GMV grew by 18% year-over-year on a like-for-like basis, adjusting for portfolio rationalization during 2024. Revenue in Europe grew even faster with growth rates of 35% on a like-for-like basis. This was a clear acceleration compared to the last quarter, mainly driven by the further expansion of own delivery logistics, AdTech and subscription programs.

Another major achievement is that Glovo has now successfully transitioned its entire rider fleet in Spain to an employment-based model and implemented structural adaptations to the rider model in Italy. In the first half of 2025, we provisioned EUR 50 million rider-related topics in Spain and Italy, which led to an adjusted EBITDA of negative EUR 51 million.

Let's now turn to our MENA segment. In the second quarter of 2025, the MENA segment showed another impressive performance, with GMV growth of 26% year-over-year, which was fueled by strong order growth the further rollout of Quick Commerce and an exceptional category position across all countries.

Saudi Arabia posted another strong quarter with order growth once again at more than 20% year-over-year. This growth was driven by the further enhancement of the subscription program and an increase in vendor-funded deals. Overall, adjusted EBITDA increased by 22% year-over-year to EUR 256 million in the first half of 2025 despite selective growth investments in Saudi Arabia and FX headwinds from a weaker U.S. dollar.

Now on to the Asia segment. The GMV development in Q2 2025 shows sequential improvement driven by better growth dynamics in both South Korea and APAC. GMV growth improved in constant currency and on a like-for-like basis, excluding the Thailand business and certain discontinued services in Korea. Revenues grew by 23% on a constant currency and like-for-like basis, showing a clear acceleration compared to Q1. This was mainly driven by the material expansion of our own delivery service in South Korea, where a broad range of game changes have been implemented that touch all areas of the business from customer experience to logistics quality, subscriptions and operations.

To point out some of the measures taken. We massively rolled out our own delivery service, which led to a significant increase in the OD share. The rollout of own delivery, both hand-in-hand with overall strengthening of our logistics, which resulted in an improved operational performance. This can be seen an improvement in delivery time and delivering experience as well as lower delivery cost to order. We consistently enhanced our subscription program, which now accounts for a significant share of total order volume. Overall, subscribers show better customer behavior such as increased order frequency and customer retention.

In April, we also introduced the Meal For One product, which increased Woowa's value proposition further. Not only has South Korea improved a lot, we can also see a remarkable improvement in the APAC region. This is a clear indicator that the new leadership structure is yielding positive results. In terms of profitability, the Asia segment exhibited an improvement of adjusted EBITDA to GMV margin of 40 basis points year-over-year to 1.7% in the first half of 2025 despite the cost for rolling out own delivery in Korea and FX headwinds.

Now continuing with the Americas segment. Americas continues to perform strongly with GMV growth of 30% and revenue growth of 29%, both in constant currency and excluding hyperinflation accounting. This performance was driven by double-digit order growth in all leadership countries and an increased lender base. Also, profitability has improved significantly, resulting in an adjusted EBITDA in the first half of 2025 of EUR 46 million, up from negative EUR 13 million in the same period of last year. This corresponds to an adjusted EBITDA margin of 2.3% of GMV in H1.

Now on to Integrated Verticals. The Integrated Verticals segment showed exceptional top line momentum with growth in GMV and revenues of 30% and 27%, respectively. This development is driven by customer experience enhancements in MENA and product optimizations in Americas. Profitability has again significantly improved with an adjusted EBITDA margin of only minus 1% in the first half, driven by expanding gross profit margins and better store utilization. We're fully on track to reach adjusted EBITDA breakeven before group costs and hyperinflation effects in 2025 on a full year basis.

Let's now have a closer look at the gross profit margin development on group level. On a group level, the gross profit margin has again improved by 40 basis points year-over-year to 8.2%. MENA Americas are already at around 10%, while expanding fast into quick commerce and further rolling out on delivery in Turkey. While we saw a dip in the Asia gross profit margin in Q1, due to the introduction of the new industry-wide vendor commission rate in Korea, the margin has recovered again to 6.9%, following the significantly stronger profitability in own delivery. In Europe, DP margins in Q4 were affected by the legal provisions in Italy and in the first half of 2025, the transition to an employment-based model in Spain weighed on the DP margin.

Let's now have a look at our results for the first half of 2025. GMV growth for the first half of 2025 amounted to 11% on a like-for-like basis. Total segment revenue once again exceeded expectations, rising by 25% and outperforming our initial full year guidance of 17% to 19% growth. This strong performance was primarily driven by the accelerated rollout of our own delivery operations in Korea. At the same time, adjusted EBITDA exhibited a robust development with an increase of 71% to EUR 411 million. Also, free cash flow showed a solid development and almost reached breakeven with negative EUR 8 million, which is an uplift close to EUR 100 million.

Let's have a look at the transition from adjusted EBITDA to net income. Starting on the left of the slide with the adjusted EBITDA of EUR 411 million. Management adjustments totaling EUR 43 million include expenses for reorganization and other restructuring measures in the amount of EUR 46 million as well as expenses for services related to corporate transactions and financing measures, which were partially offset by income from certain legal matters. In addition, we recorded EUR 126 million in share-based compensation, the majority of which is attributable to the long-term incentive plan.

Depreciation and amortization amounted to EUR 157 million and lease payments, which in alignment with IFRS or below adjusted EBITDA were EUR 73 million. Taking all factors into account, our operating result or EBIT for H1 2025, turned positive for the first time, reaching EUR 5 million. Net interest paid amounted to EUR 111 million. Other financial and at equity results include net losses from the fair value measurement of financial instruments in the amount of EUR 110 million, and FX losses amounting to EUR 72 million.

Income taxes include paid income taxes in the amount of EUR 129 million and a positive effect from deferred income taxes in the amount of EUR 55 million, mainly due to the recognition of deferred tax assets that became recoverable as profitability improved in certain entities. In total, this leaves us at a negative net result of EUR 356 million, which has been cut in half compared to the same period in the previous year.

Let's now review how free cash flow has evolved over the past compared to last year. As already mentioned, net result has improved to negative EUR 356 million on the back of strong operational performance. Noncash items have increased to EUR 730 million, mostly due to currency translation effects and fair value effects on minority investments as well as amortization effects on financial liabilities, while income taxes paid remained stable. In the same period of the previous year, we saw an unusual positive change in working capital of EUR 95 million. This year, change in working capital has normalized to negative EUR 65 million, excluding the Taiwan breakup fee of EUR 212 million and the antitrust settlement of EUR 329 million.

The position change in provisions was mainly impacted by the shift of EUR 329 million from provisions for legal risk to other current liabilities due to the antitrust settlement. CapEx was higher due to an increase in intangibles, while lease payments remain stable. When we now exclude extraordinary items such as sustained rider liability as well as the Taiwan breakup fee, we arrive at a free cash flow of negative EUR 8 million, an uplift of EUR 96 million compared to last year.

At this point, I would like to once again refer you to our announcement from December 2024 when we increased the contingent liability for Spain. At the time, we highlighted that while pursuing the final court decisions, Glovo would be required to provisionally pay or provide bank guarantees for the outstanding contingent liability, which will become due progressively over the coming years. The first payment of bank guarantees were expected no earlier than Q2 2025.

As you can see here, we made the first payment of EUR 40 million in Q2. In addition, we received final reclassification decisions from local authorities in Spain in July, resulting in payment demands totaling approximately EUR 450 million. We plan to settle these obligations in the second half of the year, which will allow us to continue pursuing our legal case through all levels of jurisdiction in parallel.

And just to clarify, the EUR 450 million mentioned is, of course, part of the previously disclosed contingent liability and does not represent an additional obligation. Irrespective of this, we can be pleased with our robust liquidity position. We ended last year with a cash position of EUR 3.8 billion following the IPO of Talabat in November and then bought back convertible bonds with a nominal value of around EUR 900 million to optimize our leverage position in February 2025.

As outlined on the previous slide, the significant increase in profitability resulted in an increase of free cash flow before extraordinary items to close to 0 in the first half of 2025. Most of the rest of the change in cash can be explained by the cash inflow of the Taiwan breakup fee in the amount of EUR 212 million and negative FX effects of EUR 134 million due to an appreciation of the euro and a weakening U.S. dollar as well as South Korean won. This leaves us with a healthy liquidity position of EUR 2.8 billion.

Let's now turn to our guidance. Due to stronger-than-expected currency headwinds, particularly from the U.S. dollar and Korean won, both of which have significantly depreciated since our guidance was published in February, we will be adjusting our outlook for 2025. While we had previously projected GMV growth of 8% to 10%, we now expect to reach the upper end of that range on a like-for-like basis, which reflects the true operational performance.

There are a few additional points on why we look at the business on a like-for-like basis. These like-for-like adjustments reflect the impact of business units or services that have been discontinued or divested, which accounts for approximately 2 percentage points. Following the faster-than-anticipated rollout of own delivery in South Korea, we're updating our guidance for revenue growth in constant currency excluding hyperinflation accounting from the previous range of 17% to 19% to 22% to 24% on a like-for-like basis.

While this stronger-than-expected revenue performance will not immediately translate into EBITDA uplift in 2025 due to the associated cost of scaling on delivery, we do expect EBITDA to benefit over time as order frequency increases and delivery efficiency improves. However, in the short term, adjusted EBITDA, which is reported in actual currency has been impacted by the aforementioned FX developments.

In the publication of our guidance in February, both U.S. dollar and Korean won have started to depreciate. While in our last trading update, we assume that we could mitigate the FX impact, currency developments have since deteriorated further relative to our initial planning. As a result, we now expect a more pronounced FX headwind in H2 than originally anticipated. At the same time, we have significantly accelerated the rollout of our own delivery model in Korea outperforming our initial plans early in the year. We've also stepped up efforts in our subscription service. We believe that investing in these structural initiatives in Korea delivers more long-term value than mitigating short-term FX headwinds.

While we still expect to offset part of the estimated FX headwind of around EUR 110 million, we are revising our guidance to a range of EUR 900 million to EUR 940 million. This adjustment enables us to continue investing in customer experience, and in particular, the fast rollout of own delivery and subscription in Korea.

At this point, I'd like to add that if today's FX environment were consistent with the conditions at the time we issued our guidance, we would be on track to deliver the adjusted EBITDA of EUR 1.01 billion to EUR 1.05 billion this year. The FX headwind is expected to have an impact on free cash flow, prompting us to revise our guidance to exceed EUR 120 million for 2025. This outlook excludes extraordinary cash inflows and outflows, including M&A breakup fees and ongoing larger legal disputes.

That's it from my side. Thank you for listening, and we're now looking forward to taking your questions. Christoph?

Thank you very much, Marie-Anne. [Operator Instructions] Operator, please go ahead.

[Operator Instructions] Our first question comes from Joseph Barnet-Lamb at UBS.

It's Joe from UBS here. I just wanted to clarify the FX headwinds driving the full year downgrade. There's no doubt that the won and dollar have moved materially against your year-to-date However, that move overwhelmingly happened prior to the 1Q results presented in April, at which point you stated you could "mitigate the current FX headwinds." And in the last month or so, FX has actually moved in your favor a little bit, I think, on the dollar side at least, and you've beaten on profits at 1H.

So I guess the question is, given all of this, what has changed now in the last few days or weeks to cause you to warn on profits driven by FX now? Is there an additional profit benefit that you'd hoped in April, you could obtain which you no longer think you will or some further investment that you now think needs to be made?

Marie-Anne, do you want me or you to cover?

Yes, I'll take it. I'll take it. Thanks, Joe. I think the difference between April and now is very much the visibility, right? I think April was a time when, yes, strong movements had happened, but it was, I think, rather unclear whether those FX movements would continue and whether the situation would stabilize, right? So I think at that point, the visibility was rather low, which is why we decided to call out the FX subject and last time we had a call. But it was very difficult at this stage to know for how long the situation would continue whether it was more of a permanent shift, right?

I think at this stage, we are further into the year. We have more information. I think the FX volatility has continued. And then we have further visibility as to how this will play out towards the end of the year. I think that's basically informing why we update now.

Thanks, Marie-Anne. And if I ask a quick follow-up, if that's okay. That implies that in April, you weren't using the prevailing spot for the rest of the year. So can you just confirm what FX rate you're now assuming in your guidance? Are you using spot from now on?

We're basically using -- I mean, we basically go through normal monthly planning process, why we update our view on FX rates for the rest of the year, right? So we're basically using the visibility we have at this stage, the same as we were doing it in April. And so that rate has obviously changed. I think, again, in April, the additional element was probably that I think it's a lot more volatile, right? Whereas now that volatility has become a little bit more normality, I would say.

Wonderful. But no incremental investment that you sort of weren't expecting in April that is driving anything else down.

No, other than the investments we just called out, right?

Our next question comes from Andrew Ross at Barclays.

If I could just kind of follow up on that and talk a bit more specifically about your expectations for Korea this year. I think previously in local currency terms, you've spoken about getting back to GMV growth in Q4 and you've spoken about platform EBITDA being down slightly versus 2024. Does that assumption still hold? And it would be very helpful if you could give us an update in terms of what you expect from GMV and platform EBITDA in Korea in local currency this year?

Would you like to cover, Marie-Anne, or?

Yes, you can start and then I'll chip in.

So yes, I think we had a very good quarter. Korea has not been easy. It's been very hard at 12 months, pretty painful. We had to change the business model from listing feed commission-based model. We had optimized our logistics to afford free delivery. We had to rebuild our tech stack. And also, we then decided to move very aggressively into own delivery, which has moved from 35-or-so-percent of the year ago to 70%. That was a move that we did sometime in Q2, and it dramatically improved the customer experience. There have been a lot of other changes. And I think we now finally start to see the effect, and we're also now in a position where we can start to push product features properly and drive customer experience. And I think that there are some good results there.

I think we're again the clear product leader in Korea, and we are pretty excited about the outlook. So we are if -- yes, we feel very confident in what we have said before. I think, we have moved faster on moving to own delivery, and we still have slightly less margin on own delivery than we have in the marketplace. So we are making more money in the marketplace than we're doing own delivery on a per order basis. So we have some incremental investments there in the own delivery space.

I think on the positive, our own delivery economics have dramatically improved and also now with the change to our delivery or logistics tech stack, we see even much better performance than we anticipated. Of course, that rollout is happening between now and end of Q1 or February -- end of February. So there will be incremental development improvement from there. But it also means net-net with a big push to own delivery, netting with better economics and own delivery still means that there is slightly more investment in this move to own delivery than previously announced.

Maybe tie back a little bit to the previous comment also from [indiscernible] here is that we also consider [indiscernible] mitigate for any FX headwinds, we came to conclusion that now we have to still keep pushing on own delivery and subscription rollout. We think those are fundamental investments that are very good for the long term. So we took those decisions. So yes, I hope that helped a little bit on the Korea side.

That's helpful. If I could just follow up. Are you still expecting that you can get back to GMV growth year-on-year in the currency in Q4?

Yes, yes.

Okay. And we should conclude, therefore, that the EBITDA in local currency is down, I guess, more than slightly, but you're not going to quantify how much in Korea. Is that a fair assessment?

Yes, it will be slightly, but I think the baseline at which we will operate from will probably be better than we anticipated in terms of, yes, we have pushed own delivery more. We expected that shift to happen. Now, it happened earlier than probably expected. We moved faster than we expected, but the economics in own delivery is better than we anticipated, in particular, with the change in logistic tech stack. So net-net, I think we're entering next year in a better position for driving economics. But yes, the massive increase in own delivery percent is taking a little bit of hit this year.

Our next question comes from Marcus Diebel at JPMorgan.

Could we talk about Saudi margins. Obviously, top line is still very strong, but it seems that the profitability took a hit. Just when I sort of like to try to back out the Talabat numbers and what you reported for MENA. Niklas, if you could just tell us a bit more sort of like what happened in terms of investments in Saudi and what the current situation is from your perspective given the competitive environment? Any more color would be helpful here.

Yes, I don't think that we have invested more than we expected, and I think the investments are still fairly small. We are speaking about yes, low double-digit amount of investments here. So I think it's not material. I think some of the back calculation is probably also coming from a big push of own delivery in Turkey. So that might be rather the explanation to the slight increased investment that you referred to or a little bit of combination of both maybe.

In terms of the business, I think so far, we have seen limited impact especially among our mid- to high-value customers. We already, as you've seen, we're still growing about 20% on the order side. So there has actually been a slight acceleration in Q2 versus Q1. So that has not been impacted. We -- yes, I think we grew nicely as we remain very focused on building the best experience by far. And yes, we're pretty excited about Saudi Arabia.

Okay. And just a follow-up then on Turkey. How long do you think the investments sort of like will continue? Because obviously, also there, the dynamics have changed now?

Yes. Maybe I need a help there from Marie-Anne on the EBITDA. I think the biggest part of the EBITDA or if you look at the increase in the net out and so on, it's rather on the dollar side. But I think in Turkey, it's economics are continued improvement in OD, similar to Korea. But there is a fairly fast rollout. We are now even a little bit ahead in Korea, but yes, we see pretty good development in Turkey as well. But there is a slight increase in cost as we have been rolling out own delivery. I don't have the exact numbers here.

Yes, just I can add there. I think we are expecting actually positive adjusted EBITDA in Turkey in second half of the year. So that's again, it follows the evolution that Niklas Oestberg and we talked about previously of really incrementally improving that business and getting it back into positive territory. And I think overall for the MENA region, yes, you do see a bit of impact from U.S. dollar in particular, right? But I think Turkey has taken individually is on track to become positive again.

Our next question comes from Giles Thorne at Jefferies LLC.

Apologies. Still managed to forget to do that. So this was a question on Korea and merchant funding as a means of driving GMV growth and dealing with competition. It's a strategy that appears well developed in other parts of the footprint, most notably in Talabat. So Niklas, it'd be interesting to hear you talking about how underdeveloped merchant funding is in Korea and what your plans are here over the next 12 months or so?

Yes. It's a very good question. And I -- we like to keep it a little bit first off. You might speak more about it at a later point. I do think that there is a clear room for improvement. I don't exactly want to share exactly how we're improving it, but we are still far away from best practice.

Our next question comes from Monique Pollard at Citi.

The question was just on the delivery expenses. They ramped a bit in the first half of the year. And I'm just trying to understand how we should think about the ramp in terms of how much is driven by own delivery rollout. We see the aggressive and successful own delivery rollout in Korea, there's more in Turkey, et cetera, versus how much of that delivery expense increase is a shift to the employment model in Spain, just so we can think about the development going forward?

Yes. I think overall, as you see on the gross profit side, we have continued to improve gross profit. I think 40 basis points, if I don't remember incorrectly here. So we are gradually improving the gross profitability and most of our businesses on delivery with a few exceptions. But the increase in absolute cost is driven by Turkey and Korea. So that's the largest driver. But overall, we keep improving the cost or the gross profit per order in overall as a business as well as for delivery even more so.

Maybe just adding to that, I think the main driver of that is indeed Korea and the shift to Korea. So I think what you are observing is probably mostly that, right? Where the cost comes in and then obviously, the fees also grow, but are affected by fee deliveries reductions as we sometimes use those as tools to push usage, right? So -- but the main driver will be Korea.

Yes. You do correctly pointed out a slight reduction also in Europe, as we also highlighted in the introductory remarks. And that is then also driven by certain provisions and as well as the move to employment model. And as you do this move, I don't know if you take Spain as an example, we had to move from more or less no employees to 30,000 or so riders that we had, and everyone had to be offered an employment model. So, of course, and some of them may never have started to work, but we still had to have them on our payroll, until they have not showed up enough times, and we still have to pay social security even if they never did that job. So that's a little bit odd, but that also means that there are quite some traditional -- transitional costs associated with this move. It is also hard to move from a complete freelance modeling -- employment model and make that super-efficient on day one. So there is still a lot of work to be done there. I think we have done huge progress, and I think it looks very good, but there is a transition cost associated also with this move to employment.

Our next question comes from Annick Maas at Bernstein.

Can you hear me?

Yes.

Okay. Great. So my question is on Foodpanda. You've mentioned that you reentered growth trajectory. Can you maybe give us a bit more color around where the growth is coming? Is this country-led, volume-led, price-led comp based? If you could just give us a bit more indication of what you've seen and what you're expecting for the rest of the year?

It's pretty broad-based. I think more or less in growth in every country now, or maybe there's some exception, but overall on a good growth direction across the region, and there's a big uplift across the board. So as you know, we did some big changes, leadership changes. Of course, it was also a business that was a little bit put on the back burner while we were in M&A discussion. I think that was a big mistake. And we did a very poor job during this transition.

I think the focus we have had over the last year, you really see how that is paying off, and we have a fantastic leadership there, which you can also see. So lower cost, more growth and it's broad-based.

Our next question comes from Wofgang Specht at Berenberg.

Yes. One additional question on the installment payments you indicated in your presentation. We understand that a large part of that should go to the antitrust case. I guess the figure was around EUR 330 million. So if you're indicating some outflow of EUR 450 million other remaining EUR 120 million purely installment payments for the legal actions in Spain? Or is there something else?

It was a bit hard to hear, but I'll try to answer what I understood. So the question was around upcoming outflows for certain legal cases, correct. So yes, you've seen the EU settlement, right? And that amount is agreed, but not paid yet, but will be paid in the course of this quarter. So you will have that as an outflow. And then on Spain, we highlighted the EUR 450 million of payment notices we received and those will also be paid in the coming months, right? So that's another outflow you're going to see. I don't know if that covers the question. I didn't quite hear you at the beginning of it.

That's the Spain payments would be reversed in case you made -- you strike a better deal with authorities?

Yes. I mean the cost of action here is that the case proceeds through the legal route, and we will pursue it in the legal -- in the courts, right? So depending on that outcome, obviously, there could be a reversal of that once that reaches its conclusion, which will take a while.

Our next question comes from Jurgen Kolb at Kepler Cheuvreux.

Just indeed, one on a more longer-term view, it looks like the OD share is growing stronger than you may have initially expected. We're now talking about the rider employment model in some more markets. The 5% to 8% EBITDA margin, is that still reachable and still absolutely in line with what you're currently seeing? Or would you think that you need to do some adjustments there?

Thank you. So generally, how we see it is that there is a certain gross profit rate that we are aiming for -- that we aim for in order to reach a certain target EBITDA margin that we find reasonable and acceptable, both for shareholders and everyone involved, and we do not want to take it higher because that also, yes, we want to keep it at a certain level. So that is the target.

Then how we get to the target? Ideally, you get to the target by charging the consumers less delivery fees and that you can still deliver very fast in a speedy fashion, that's one. The -- but there's always a fallback there. If we see that we cannot get to that level, then we have to stack more. That means delivery times would be a little bit longer, but of course, the economics will be much better, or we have to narrow delivery distances and kind of try to drive orders in a much shorter delivery distance to reduce delivery cost, or we have to charge more for subscription or we have to charge a delivery fee or a service fee or -- so that's kind of the last resort, but as always, I don't know what you will do to get to your target.

But ideally, we want to get to the target by not charging more to consumers and by keep delivering very fast and keep as much option as we can and so on and then work really hard and innovate and use other means, including robotics and other things that we will keep doubling down on. And -- but again, the fallback is that we will have to charge consumer. And of course, the more we charge consumer, there is also then a slight impact on growth.

But from where we stand now, we think that consumer fees will go down, service will go up and we will still reach that target. We think there's still a lot of room to improve, both in ad tech or in our logistic efficiencies, et cetera, et cetera. So -- but the target -- it's just where we want them to, and that's where we're going to go to. Then you ask the question how you get there.

Our next question comes from Luke Holbrook at Morgan Stanley.

My question is actually just on recent speculation around your Talabat stake and particularly the willingness for a potential sell-down. Can you just indicate if you're keeping options open currently or whether that type of option is not on the table?

We have no interest in selling any single share of Talabat at current valuations. That's our current stance.

Our next question comes from Joseph Barnet-Lamb at UBS.

Yes, obviously, since the last time you spoke to us, it's been announced that your largest shareholder will be selling down their stake in Delivery Hero very meaningfully. I'm just interested if you're able to comment on the degree to which you could be interested in either fully or partially sort of buying back stock, if that's something that you consider or any comment you can give around that?

Yes. We can't give any comment on that. But good try, Joe.

Always worth a try, my friend.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Thank you very much, and thank you, everyone, for your support. Yes, I hope and believe your patience will eventually pay off. I know it's tough times for shareholders. But I hope the patients will pay off. I think the business is doing very well. I hope you see it the same way. And then to all Heroes, yes, keep filing every day to improve the service to our customers, vendors, riders and pickers, and yes, work hard every day. Thank you very much, everyone.

This concludes today's call. Thank you, everyone, for joining. You may now disconnect.