Ocado reports significant revenue growth as customer numbers soar
- Ocado's annual revenue reached £2.7 billion, reflecting a 14% increase over the prior year.
- Customer engagement surged, with 1.1 million active customers and a significant rise in weekly orders.
- The strong sales growth indicates a positive shift for Ocado as it aims for sustained market leadership.
In the United Kingdom, Ocado, the online grocery platform in partnership with Marks & Spencer, experienced substantial growth in sales and customer base over the year leading up to December 1, 2024. The company reported revenues of £2.7 billion, marking an increase of nearly 14% from the previous year. This surge was attributed to an increase in the number of active customers, which reached approximately 1.1 million, alongside a rise in average weekly orders and a more extensive range of products including popular Marks & Spencer items. During the crucial Christmas trading period, Ocado noted record sales, significantly boosted by consumer demand for party food offerings such as pigs in blankets and a variety of cheeses. Their revenue for the fourth quarter amounted to £715.8 million, reflecting a year-on-year increase of 17.5%. Additionally, average orders per week grew 17%, demonstrating a strong customer engagement during this peak shopping season. The company’s chief executive, Hannah Gibson, emphasized the importance of lowering prices to attract customers, as they promised to match prices with Tesco on over 10,000 products. Such strategic pricing was part of a larger plan to enhance customer service and ensure that shoppers could access their favorite M&S products easily, which contributed to a stellar performance in order volume. Looking ahead, Ocado expressed optimism regarding maintaining market-leading sales growth and further operational efficiency. Improvements in their customer fulfilment centers showed promise as their network exceeded design capacity during peak trading times. However, market analysts indicated that consistent profitability remains a challenge for Ocado, despite its growth. Securing international orders for its logistics technology was mentioned as a potential pathway to diversify revenue streams. Such a strategy may not only bolster revenues but also provide a long-term framework for sustainable growth in the competitive grocery sector.