Dive Brief:

• HelloFresh’s U.S. revenue was up sharply in the second quarter of 2022 compared with the same period a year ago, but customer growth in the country decelerated, the German meal kit company reported Monday.
• The company took in just under 1.1 billion euros ($1.1 billion) in the United States during Q2, up 21.6% in constant currency over the second quarter of 2021.
• HelloFresh’s active U.S. customer count expanded by 5.5% year-over-year in Q2, the company’s slowest rate of growth by that measure since the start of the pandemic.

Dive Insight:

HelloFresh’s revenue is surging in the United States against a backdrop of high inflation, especially for food. The company also posted strong revenue growth for its operations in other countries, and saw its global revenue come in just shy of 2 billion euros, up 16% in constant currency compared with the second quarter of 2021.

The company has continued to perform well despite the rising costs it faces, Dominik Richter, CEO and co-founder of HelloFresh, said in a statement. “Even though we’ve been facing a number of macroeconomic challenges, our teams have been able to continue to make significant progress across a number of dimensions,” Richter said. “These include progressing investments in production sites and automation, improving productivity across our distribution centers and improving the customer experience by adding more choice, more flexibility and an overall better service.”

Richter added that HelloFresh has not had to pass on all the higher costs it has been dealing with to its customers, which has helped the company offer “attractive and competitive pricing” despite the economic pressures.

HelloFresh’s strong revenue growth in Q2 followed the robust results it posted in Q1, when the company’s U.S. revenue rose 27.6% in constant currency and passed 1 billion euros in a single quarter for the first time.

But while HelloFresh’s revenue has remained robust, the company expanded its customer base during Q2 at a much slower pace than it did in prior quarters.

The company’s U.S. active customer count grew at a 15.2% rate during Q1 compared with the first quarter of 2021, which represented a sharp slowdown from the 34.9% year-over-year pace in U.S. customer growth HelloFresh recorded during the fourth quarter of 2021.

HelloFresh’s active customer growth rate in the United States hit a 92.9% year-over-year rate during the second quarter of 2021 and has slowed during every quarter since then. Growth in the number of orders the company has received from U.S. customers and the quantity of meals it has delivered in the country has also steadily decelerated.