Seven of 11 new-age listed companies continue to be loss-making in Q2FY26, but investors remain upbeat

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Seven out of 11 listed tech and internet firms that have declared Q2FY26 results so far have posted losses during the three month period, according to a Moneycontrol analysis. The performance has however not dampened sentiments as investors look past the short-term declines and bet on positive future outcomes.

During the July-September period, Delhivery, Swiggy, Mobikwik, Urban Company, Ixigo, BlueStone and Ola Electric, all reported losses. Some firms even saw their profit profile worsen on a year-on-year (YoY) basis.

Investors are upbeat

While some firms, such as travel solutions company Ixigo and fintech platform Mobikwik, slipped into red largely due to a special one-time expenses, there were other also firms like Swiggy and Urban Company which saw their profits take a hit as they prioritised growth, over profitability, as they continued to ward off competition from unlisted players and protect their market share.

Several of the technology companies are compounding and growing which is why short-term profits are compromised, according to Ambareesh Baliga, an independent public markets participant. “As long as the bread and butter businesses, the core units, of these new-age companies are growing and are profitable and these companies are also adding new verticals, they will continue to attract investor interest,” he said.

For such businesses, it is usually the new verticals that are responsible for the losses. “Earlier it was one vertical which was profitable and the second vertical being in the investment stage, because of which they were showing a loss. Two-three years later, these tech companies will have two or three verticals making profits and one vertical making a loss, so net net they’ll be profitable.” Baliga said. “Investors cannot stick to the same old idea that a business should be run in a particular and traditional way only. The world is changing,” he added.

Core businesses turn profits

In fact, that is exactly what is playing out at the listed tech companies. Take for instance Urban Company, the company which reported a net loss of Rs 59 crore in Q2FY26, widening from a loss of Rs 2 crore incurred during Q2FY25.

The company invested heavily in InstaHelp, a unit that provides professionals for certain services in 10-15 minutes, during the quarter. In addition, it also invested in Native, a brand through which it sells water purifiers and more initiatives during the quarter all of which weighed on profitability, but will likely help grow revenues in the future.

Excluding InstaHelp, Urban Company delivered an adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) profit of Rs 10 crore, marking a year-on-year (YoY) improvement of Rs 15 crore, implying the core business is profitable, Abhiraj Singh Bhal, co-founder and CEO of the company told shareholders.

“We recognise that these investments impact short-term profitability, but the opportunity in InstaHelp is both significant and immediate,” Bhal said.

Similarly, Swiggy’s food delivery business, its core unit and oldest vertical, is profitable and generates cash which offsets losses in the new divisions, like quick commerce, to an extent. Swiggy is now looking to raise an additional Rs 10,000 crore to invest in Instamart, its quick commerce division, to fast-track growth.

Shift in expectations

Another reason why businesses like Urban Company’s InstaHelp and Swiggy’s Instamart see their losses widen is because of the competition from unlisted and venture capital-backed businesses, which have no pressure to show immediate results on a quarterly basis.

While InstaHelp faces competition from new Snabbit, which has been on a fundraising spree to gain market share, and Pronto, another startup looking to make gains in the quick services space, Swiggy’s Instamart is seeing its unlisted private rival Zepto up the competitive intensity which has forced listed players to react, too. ( )

“The tone turned more aggressive (in Q2FY26), with renewed push for discounts and brand marketing. After a couple of quarters of low competition, all (food delivery and quick commerce) players have shifted their focus back to growth,” the analysts at Motilal Oswal in a recent client note on Swiggy and Eternal (formerly Zomato).

In the private space, venture capitalists incentivise companies to grow their revenues by expanding the market and in the process, their bottom line takes a backseat.

However, when these firms go public, the expectations shift.

“For most of their lives, these new-age companies have been taught to grow at all costs by investors who have been with them for several years. Suddenly, a new set of investors – the public market fund managers – have a different set of expectations from them which is what causes short-term mismatch,” said Deepak Shenoy, CEO, Capitalmind Mutual Fund.

The public market investors operate in a certain way because they are looking to profit by betting on the company and its share prices in just a few months’ time. Once their goal is met, they exit their position and move on to their next targets, which is almost the opposite of VCs who stick around for several years, as per Shenoy.

“It takes every company a few quarters to get used to the public market life. Then, the good ones – who show they have good and interesting business models that can turn profits – continue to get investor support. The others fall by the wayside,” he concluded.