PhysicsWallah, Lenskart, and Nykaa Report Record Profits in Q2 of FY2027

The second quarter of the 2027 fiscal year marked a turning point for PhysicsWallah (PW), as scaling up and improving operational efficiency led to record quarterly revenue and doubled net profit.

Founder and CEO Alakh Pandey stated that the company achieved record revenue and significantly improved profitability, while the student base continues to grow in K-12 segments, local languages, and new categories. He emphasized that the company's focus remains on scaling accessible, technological education with disciplined capital allocation.

For the second quarter of the 2027 fiscal year (July to September 2026), PW recorded its highest quarterly revenue in history, driven by an increase in enrolled students and improved course delivery. Consolidated operating revenue reached ₹1242.26 crore, which is 18.2% higher compared to the same period last year. Total income, including other non-operating receipts, increased by 21.5% year-on-year to ₹1334.64 crore.

The company operates through two main service delivery channels, as well as auxiliary services. The online channel remained the primary driver of revenue growth, generating ₹693.52 crore in operating revenue for the quarter. This represents a 26.4% year-on-year growth compared to ₹548.72 crore the previous year and accounts for 55.8% of total operating revenue. The offline channel contributed ₹540.87 crore, which is 9% higher than ₹496.10 crore the previous year, making up 43.5% of operating revenue.

Other operating streams, such as YouTube advertising, hardware sales, and institutional support, brought in ₹7.87 crore, showing a 22.4% year-on-year growth.

Profitability significantly increased because fixed platform, content, and educational infrastructure costs were spread over a wider user base. Consolidated profit after tax doubled to ₹142.29 crore in the second quarter, a 104.1% increase compared to ₹69.72 crore the previous year. It is important to note that the net profit in the second quarter of the 2027 fiscal year was realized after a loss of ₹87.04 crore in the first quarter of the 2027 fiscal year.

The profit margin after tax, calculated as net income divided by operating revenue, expanded by 482 basis points to 11.5% from the previous 6.6%. Earnings before tax grew by 111.6% year-on-year to ₹209.15 crore. This amount included a one-time goodwill impairment charge of ₹20 crore and an increase in fair value of financial instruments of ₹10 crore.

EBITDA, according to Indian Accounting Standards (IndAS), reached ₹348 crore, providing a margin of 28.0% compared to ₹228 crore and a margin of 21.7% in the same period last year. Adjusted EBITDA, which accounts for fair value adjustments and lease obligations, grew to ₹399 crore with a margin of 32.1%, compared to ₹270 crore and 25.7% previously. Cash EBITDA before IndAS grew by 45.0% year-on-year to ₹233 crore, raising the margin to 18.8% from 15.3%.

Total consolidated operating expenses amounted to ₹1105.43 crore. The largest cost center was employee benefits at ₹522.38 crore, including ₹482 crore in basic salary and ₹40 crore in non-cash stock-based compensation. Other operating expenses totaled ₹237.58 crore, with marketing, advertising, and public events accounting for ₹87.92 crore.

The online segment benefited from increased student engagement and higher enrollments. The number of unique users transacting online grew by 12.9% year-on-year to 1.5 million for the quarter, while the average fee per user increased by 10.6% year-on-year to ₹4280. Growth was supported by high demand for premium course packages, as revenues from Infinity and Infinity Pro collections rose by 49% in the second quarter.

Expansion also occurred in more expensive non-medical categories: the average fee for civil services increased by 34.2%, GATE grew by 30.7%, preparatory courses by 22.6%, and MBA programs by 21.4%.

During the quarter, there was an operational shift in demand for medical entrance preparation. The postponement of the NEET UG 2026 exam results until July 16 delayed student admissions, shifting a significant portion of enrollment activity into the second quarter. Consequently, online enrollments for NEET grew by over 30% year-on-year over the three-month period.

In the offline segment, revenue reached ₹541 crore across 370 physical centers, compared to 314 centers the previous year. The offline channel recorded an EBITDA before IndAS loss of ₹8 crore in the second quarter, a decrease compared to previous periods due to improved resource utilization in mature centers.

Company management has intentionally slowed down physical expansion to 25–30 new centers annually to focus on center-level profitability and smaller footprint models. To optimize capital deployment, PW sold a portfolio of loans worth ₹96 crore from its subsidiary FinZ Finance Private Limited to Auxilo Finserve Private Limited on October 3.

The integration of artificial intelligence has enhanced operational efficiency on learning platforms. The company reported that automated systems resolve 80% of student support queries without human intervention and generate 92% of internal source code. Furthermore, the company is developing AI Tuto—a voice-based 1:1 conversational tutor, estimated to cost ₹17 per hour to serve students.

FSN E-Commerce Ventures, the parent company of cosmetics retailer Nykaa, demonstrated an almost threefold increase in net profit in the second quarter of the fiscal year 2026-2027 (Q2FY27). This growth is attributed to the accelerated development of premium cosmetics and improved operational efficiency of the company.

The company's net profit for Q2FY27 increased to 101.19 crore rupees, compared to 32.98 crore rupees for the same period last year. The consistent growth in net profit amounted to 26.8 percent.

The company's operating revenue for Q2FY27 grew by 28 percent year-over-year (Y-o-Y) to reach 3,006.04 crore rupees, whereas last year this figure was 2,345.98 crore rupees. In the first quarter of FY27, revenue stood at 2,782 crore rupees.

Year-over-year expenses also rose by 24.7 percent, totaling 2,867.05 crore rupees. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) for the quarter increased by 65 percent Y-o-Y, reaching 263 crore rupees, with the margin expanding to 8.7 percent in Q2FY27.

Falguni Nayar, Executive Chairperson, Founder, and CEO of Nykaa, noted that the results of this quarter reflect the strength of the Nykaa ecosystem, where each business contributes to growth and productivity. She added that the company continued to improve operational efficiency, especially in marketing and overhead costs. Growth is observed in the beauty and fashion segments, while House of Nykaa and Wellness provide significant opportunities for long-term development.

The company's beauty vertical showed a 25 percent Y-o-Y growth in Gross Merchandise Value (GMV), reaching 4,454 crore rupees, thanks to the sustained development of its omnichannel presence, supported by new customer acquisition and repeat purchases. The company reported that this includes metrics from e-commerce, physical stores, eB2B distribution, and the House of Nykaa Beauty portfolio.

Nykaa Now's express delivery vertical expanded to 15 cities, with plans to reach over 25 cities by the end of FY27. Nykaa Now offers over 1000 brands and a depth of beauty and personal care (BPC) inventory more than twice that of standard express delivery. The statement emphasized that carefully selected premium and luxury offerings resonate with consumers, leading to an average transaction value three times higher than the average transaction value in the express delivery BPC category.

The fashion segment also demonstrated growth, increasing GMV by 42 percent Y-o-Y to 1,674 crore rupees. Nykaa currently has 338 offline stores and added 73 new stores over the year.

House of Nykaa achieved an annual GMV rate of 4,000 crore rupees. To date, the portfolio has served over 19 million customers. The company stated that House of Nykaa continues to strengthen its relevance to consumers and open new growth opportunities through innovations in products, packaging, and formulations. It was also noted that Dot & Key released eight new shades of its Tinted Sunscreen, as well as Dragon Fruit Jelly Bounce Moisturiser. Kay Beauty entered the skincare segment this quarter, marking its first year of operation in the UK through its presence on Space NK and TikTok Shop.

The company's B2B distribution channel, Superstore by Nykaa, reached a GMV of 328 crore rupees. The base of registered retailers grew by 27 percent Y-o-Y, exceeding 550,000. During the quarter, Superstore strengthened its portfolio with next-generation brands in skincare, makeup, and wellness, including Recode, Lacto Calamine, Clay Co., BLA BLI BLU, Renee & Love Earth, and others.

The educational technology company PhysicsWallah reported on Wednesday that its net profit for the second quarter of fiscal year 2027 nearly doubled, reaching 142.29 crore rupees. In the same quarter last year, the company reported a profit of 69.72 crore rupees.

The net profit in Q2FY27 followed a loss of 87.04 crore rupees recorded in the first quarter of fiscal year 2027.

The company's operating revenue amounted to 1,242.26 crore rupees, which is 18 percent higher compared to the previous year when it was 1,051.24 crore rupees. Meanwhile, total expenses increased by 10.5 percent, reaching 1,105.4 crore rupees in the quarter ending in September, compared to 999.55 crore rupees the previous year. In the preceding quarter, the company's expenses were 1,242.17 crore rupees.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) rose to 348 crore rupees, and adjusted EBITDA stood at 399 crore rupees. As of September 30, 2026, the company's treasury balance reached 5,268 crore rupees, including proceeds from the initial public offering.

Founder's Statement

Alakh Pandey, founder and CEO of PhysicsWallah, noted that the current quarter demonstrates the strength of their business model. He stated that the company achieved record revenue and significant improvement in profitability, while the student base continues to expand in K-12 segments, local languages, and new categories. The company maintains a focus on scaling accessible, technology-driven education with disciplined capital allocation.

Previously, the company mentioned that in the previous quarter, the examination cycle was postponed due to the NEET exam leak scandal, which led to a temporary change in admission timelines and a decrease in NEET applicants in Q1. However, in the second quarter, NEET applicant enrollment grew by more than 30 percent as demand postponed due to the NEET UG postponement was realized.

In addition to JEE-NEET exams, PhysicsWallah reported that growth is expanding through other categories, which accounted for 73.8 percent of online enrollments, up from 64.8 percent. Specifically, enrollments for council and CUET exams grew by 130 percent, reaching 4.55 lakh, while enrollments for preparation courses grew by 15 percent to 5.7 lakh, and enrollments in local languages grew by 77 percent to 1.23 lakh.

The company's online revenue increased by 26.4 percent year-on-year, reaching 694 crore rupees, while offline segment revenue grew by 9 percent year-on-year, amounting to 541 crore rupees.

Regarding expansion into the southern Indian market, PhysicsWallah indicated that its target market covers approximately 15 million students in Andhra Pradesh, Telangana, Tamil Nadu, Karnataka, and Kerala. The company noted that in the first half of the current calendar year, the number of students on the PhysicsWallah app from South India grew by 32 percent to 4.1 lakh, and paying students grew by 14 percent to 1.17 lakh. Currently, the company has 63 centers in the southern region.