In a groundbreaking fiscal year, upGrad, the leading edtech firm spearheaded by Ronnie Screwvala, reported a stellar revenue of Rs 1,194 crore for FY23, marking an impressive 96% surge from Rs 608 crore in FY22. The company, aligning with its listing plans, transitioned to the widely accepted IndAS accounting standard in FY23.
On an annual recurring revenue (ARR) basis, upGrad indicated potential higher revenues; however, some mergers and acquisitions (M&As) did not consolidate in FY23. Consequently, the company carried forward a deferred collected revenue of Rs 443 crore to FY24. The adjusted Ebitda loss (operating cash loss) stood at Rs 558 crore, a slight improvement from Rs 572 crore in FY22.
Mayank Kumar, co-founder and managing director of upGrad, expressed confidence, stating, “We are in a very strong place as we build upGrad for the world, out of India.” He emphasized the company’s focus on long-term growth in the skilling, careers, job placements, formal learning, and workforce development space.
In FY23, non-cash expenses included an accelerated goodwill write-down of Rs 410 crore and depreciation and amortization costs of Rs 140 crore. The finance cost amounted to Rs 34 crore, contributing to total other non-cash costs of Rs 584 crore. The firm disclosed that Ebitda, non-cash expenses, and finance costs led to a loss of Rs 1,142 crore, up from Rs 648 crore in FY22.
Kumar highlighted key financial metrics, stating, “Our gross margins are close to 80 per cent; we have zero net debt, and have one of the best return on capital employed (ROCE) ratios for a new-age company, having raised a tight $265 million since inception.” He outlined the company’s trajectory toward operational profitability by H2 of FY24 and beyond.
Significant changes in large cost items showcased a notable reduction in marketing costs to 19 per cent (Rs 371 crore) of total costs, compared to the previous year’s 33 per cent (Rs 403 crore). Employee costs remained the highest contributor at 36 per cent, amounting to Rs 707 crore, inclusive of non-cash costs for the Employee Stock Ownership Plan (ESOP) accounting.
Despite the challenging economic landscape, upGrad reported minimal layoffs in the last 12-18 months, a rarity in the new economy sector. The overall learner base surpassed 10 million, with paid learners growing by 54 per cent compared to the previous year. upGrad’s enterprise arm expanded its global footprint, projecting a higher share of international revenue at 21 per cent in FY24, compared to 10 per cent in FY23.
