Top Korean food delivery app posts record profits

Woowa Brothers Corp., the operator of South Korea’s top food delivery app, posted a record profit in 2022, which also marked its first profit in four years, led by the exponential growth in the food delivery market during the COVID-19 pandemic.

The company, commonly known as Baemin or Baedal Minjok, reported 424.1 billion won ($325 million) in consolidated operating profit in 2022. That compared to a 75.7 billion won shortfall the previous year, according to its regulatory filing on Friday.

It snapped out of four years of losses recorded between 2019 and 2021.

Sales jumped 46.7% on-year to 2.9 trillion won. The results are on a preliminary basis.

Since the COVID-19 pandemic struck in 2020, food delivery services have spread to almost all age groups. In 2022, food delivery orders increased nearly threefold to 1.11 billion cases, compared to 400 million in 2019.

The number of restaurants or stores available on the app has more than doubled since the end of 2019 to 300,000 by the end of last year.

The turnaround was also attributed to a 39% cut in marketing costs from the previous year to 2.1 billion won.

Woowa Brothers also reduced advertising spending by 3.8% to 71.5 billion won as competition waned between food delivery apps.

However, with the easing of the pandemic, there are signs of the food delivery market sputtering.

Last month, Baemin's active monthly user number reached 19.5 million, a 5.7% drop from the year-earlier period.

Write to Jong-Kwan Park at pjk@hankyung.com


Yeonhee Kim edited this article