The Ed-tech giant, Unacademy reported a net loss of Rs 1,678.15 crore in the Financial Year 2022 shrinking by around 40% for the FY 2022-23. The Softbank backed startup saw a modest 26.15% increase in revenue for the fiscal year ending in March 2023, while also reducing losses by 39.4%.
According to the reports sourced from the Ministry of Corporate Affairs revealed that the company’s employee benefit expenses fell to Rs 1,281.28 crore from Rs 1,771.64 crore in FY22.
Meanwhile, the ed-tech company witnessed an increase of 26 percent in operating revenue, reaching Rs 907 crore compared to the previous year's Rs 719 crore.
How much reduction in loss?
Unacademy's expenses for employee benefits increased to Rs 1,772 crore in the financial year 2022 from Rs 749 crore in the previous year.
The edtech unicorn’s total expenses declined to Rs 2,734.22 crore in FY22 from Rs 3,703 crore a year earlier. The company’s employee benefit expenses accounted for 47 percent of the company’s total expenses.
More than 2,000 workers laid off
Unacademy laid more than 2,000 workers since the start of 2022 in a bid to cut costs during a funding shortage in the startup industry, particularly affecting the edtech sector.
Last year saw of over 80 percent:
However the increase in growth was lower compared to the previous year, when the company's operating revenue surged by over 80 % from Rs 398 crore. In FY23, the total income rose to Rs 1,044 crore from Rs 845 crore in the previous year.
Other Ed-tech companies also reducing their losses
Unacademy, along with other edtech unicorns such as upGrad and Eruditus, is now part of a trend among startups to decrease their losses as investors are becoming more cautious about backing high-growth, yet loss-making ventures. This move reflects a broader shift in the startup ecosystem towards financial sustainability and prudence.
Positive cash flow for the first time
In June 2023, Unacademy had its first month of positive cash flow. While the financial reports for FY23 are not available, the company had a net loss of ₹2,848 crore in FY22, marking an 85 percent increase from the previous year.
