Just Eat takes £2.5bn hit on Grubhub as takeaway orders dwindle

Just Eat Takeaway.com revealed a 3 billion euro (£2.5 billion) hit over its US-based Grubhub business as it reported a drop in half-year orders after demand eased with the waning of the pandemic-fuelled boom.

Total orders fell 7% in the first half of 2022 compared with a year earlier due to the lifting of lockdowns and fewer people ordering food to eat at home, the delivery giant said.

The group’s first half losses narrowed to 134 million euros (£112 million) against losses of 189 million euros (£158 million) a year ago.

Just Eat said its “path to profitability is accelerating” as it strives to swing into profit as a top priority in 2022.

But the takeaway company took a 3 billion euro (£2.51 billion) impairment charge as it wrote down the value of its US subsidiary Grubhub, which it bought in 2021.

In July, it announced that Amazon would take a stake in the businesses and Prime subscribers in the US would get free Grubhub+ membership for a year.

Just Eat said on Wednesday that it is still assessing the financial impact of the deal.

Chief executive Jitse Groen said: “After a period of exceptional growth, Just Eat Takeaway.com is now two times larger than it was pre-pandemic.

“Whilst this growth required significant investment, we have continued to focus on executing our strategy to build and operate highly profitable food delivery businesses.”

Revenue also leapt 13% higher year on year in the UK and Ireland, reflecting efforts to improve profits from its individual food sales.

Just Eat forked out 414 million euros (£346 million) on marketing in the first six months of 2022, a 40% increase on last year, following the Grubhub acquisition and launching a costly advertising campaign with Katy Perry.