Several new-age tech-based companies reported improving profitability in the December quarter, underscoring a continued shift away from growth-at-all-costs strategies towards more sustainable business models. Of the 12 major startups that have reported results so far for the October-December quarter, nine showed an improvement in their bottomlines, with most also posting double-digit revenue growth.
Payments and fintech firms were among the strongest performers. MobiKwik swung to a profit of Rs 4 crore in Q3 from a loss of Rs 53 crore a year earlier, helped by sharply lower lending-related expenses. Pine Labs reported a profit of Rs 42 crore compared with a loss of Rs 57 crore in the year-ago period, as it continued to pivot towards software-led and higher-margin deals.
Consumer and enterprise-facing startups
Other consumer and enterprise-facing startups also moved into the black during the quarter. Jewellery retailer Bluestone reported a profit of Rs 68.9 crore, while logistics platform Blackbuck posted a profit of Rs 32 crore. Beauty e-retailer Nykaa recorded a 142% year-on-year jump in net profit to Rs 63.3 crore, driven largely by growth in its core beauty segment. Food delivery firm Eternal reported a 73% rise in profit to Rs 102 crore.
Some companies remained loss-making but showed signs of financial improvement. Electric two-wheeler maker Ather Energy. Energy narrowed its loss to Rs 84.6 crore from Rs 197.5 crore a year ago, reflecting tighter cost controls even as it continued to invest in product development and distribution.
However, the profitability trend was not uniform across the sector. Online gaming firm Nazara Technologies reported a 36% decline in profit to Rs 8.8 crore, primarily due to the de-consolidation of its e-sports subsidiary Nodwin Gaming. Excluding this impact, profit after tax grew by about 3%.
E-commerce platform Meesho, which listed in early December, saw its loss widen sharply to Rs 490.7 crore from Rs 37.4 crore a year earlier. The company stepped up investments in its logistics arm Valmo and in driving user growth, which weighed on margins during the quarter.
Food delivery firm Swiggy also remained in the red, with its loss widening to Rs 1,065 crore from Rs 799 crore a year earlier, despite a 54% increase in revenue. The company continued to invest aggressively in its quick commerce business Instamart amid intense competition.
On the topline
On the topline, most startups reported strong growth. Eternal’s revenue nearly tripled to Rs 16,315 crore, driven by gains from Blinkit and its core food delivery business. Swiggy’s revenue rose 54% to Rs 6,148 crore. Edtech firm PhysicsWallah posted a 34% increase in revenue to Rs 1,082 crore and a similar rise in net profit to Rs 102.3 crore. The main outlier was Nazara, which reported a 24% decline in revenue due to the Nodwin deconsolidation.
Overall, the results suggest that while the path to profitability is becoming clearer for many startups, the sector remains split between firms consolidating profits and those still investing heavily to build scale and market leadership.