Ola Electric’s net loss for the first quarter of FY26 widened to Rs 428 crore from Rs 347 crore a year ago as revenue halved due to faltering sales and rising competition from legacy two-wheeler makers.
Revenue from operations of the Bengaluru-based electric two-wheeler (E2W) manufacturer fell 50% to Rs 828 crore in the quarter, down from Rs 1,644 crore in Q1FY25.The results beat Bloomberg estimates Rs 735 crore revenue and a net loss of Rs 452 crore for the quarter.
Ola Electric shares surged over 19% to close at Rs 47.46 on the NSE as the company reported improvements in key operating and financial metrics on a sequential basis.
Sequentially, revenue rose 36% from Rs 611 crore in Q4FY25, while net loss narrowed sharply from Rs 870 crore in the January–March quarter.
The company’s Ebitda loss for the reporting quarter stood at Rs 237 crore in comparison to Rs 205 crore in the same quarter last year. Bloomberg pegged the Ebitda loss at Rs 287 crore for the quarter.
The Ebitda in the auto segment improved significantly to -11.6% from -90.6% in Q4FY25 with June emerging as the first Ebitda-positive month.
Ola Electric founder, chairman and MD Bhavish Aggarwal attributed the sequential turnaround to the launch of its cost-effective Gen 3 scooter range and its internal cost-saving initiative, Project Lakshya, aimed at boosting operational efficiency.
“Improved gross margin, which was as a result of our Gen3 platform and also the Project Lakshya helped us reduce our operating expenses (Opex) significantly,” he said during the earnings call. He added that this quarter’s gross margins came largely without any incentives.
The company reduced monthly auto operating expenses (opex) from Rs 178 crore to Rs 105 crore.
“Operating cash flow for the auto business was nearly neutral in Q1, and free cash flow improved to -Rs 107 crore, a significant improvement from -Rs 455 crore in Q4FY25,” the company said.
On the sales front, Ola Electric dispatched 68,192 units in Q1FY26, a steep drop from 125,198 units a year ago as rivals TVS, Bajaj, and Ather Energy ramped up their market share.
Aggarwal said the company has shifted its focus in recent quarters from aggressive expansion to more sustainable growth.
“After the initial hyper growth phase, industry is steady and consolidating and there will be another growth phase in the near future but till then it’s time for players to actually consolidate their operations,” he said.
Sequentially, however, vehicle sales rose 33% from 51,375 units in Q4FY25. Ola expects its Gen 3 scooters and Roadster electric bike to drive volumes going forward.
“Roadster is now available in about 200 stores and will scale up to the majority of our stores this quarter in time for Navratri,” Aggarwal said. He added that Ola’s EVs will gradually transition from using supplier cells to its indigenously developed 4680 cells, beginning in Q2FY26.
For FY26, Ola Electric expects to sell between 325,000-375,000 vehicles and generate Rs 4,200–4,700 crore in revenue. It sold 359,221 units in FY25. With PLI benefits kicking in from Q2 for its Gen 3 portfolio, gross margins are expected to rise to 35–40%, and the company anticipates full-year auto Ebitda of over 5%. The auto segment is also expected to remain Ebitda positive from Q2 onwards.
On the issue of rare earth magnet shortages, Aggarwal said the company is working on parallel solutions. “We have a dual strategy of managing through alternate suppliers for magnets and also coming out with a rare earth free motor for vehicles. We have been working on these technologies for the last year or two. It will be delivered to customers in the next quarter,” he said.
