Urban Company Q2 results: InstaHelp vertical drags margins as investments weighs on profits

Urban Company Q2 results: New Insta Help vertical drags margins as upfront investments weigh on profits

Urban Company’s new daily housekeeping service, Insta Help, has seen strong early adoption since launch earlier this year — but the rapid scale-up has come at a cost. The company reported an EBITDA loss of Rs 44 crore from Insta Help alone in the second quarter (Q2) of financial year 2025-26 (FY26), as it invested heavily in partner training, onboarding, and network expansion to build capacity in the new category.

The loss from Insta Help weighed on overall profitability, with Urban Company’s consolidated adjusted EBITDA turning negative at Rs 35 crore, compared with a profit of Rs 21 crore in the previous quarter. The company said these upfront costs were expected as it expands into a high-frequency use case aimed at boosting customer retention and platform engagement.

“Foregoing the Insta Help opportunity would have preserved short-term profitability, but that would be the wrong strategic choice for long-term growth,” Urban Company said in its shareholder letter.

What is Insta Help?

Launched in February 2025, Insta Help offers daily housekeeping and cleaning services within 15 minutes, catering primarily to working professionals and families seeking consistent in-home maintenance. It marks Urban Company’s entry into a high-frequency, high-engagement segment, complementing its existing on-demand categories like beauty, salon, and appliance repair.

The service is now live in Mumbai, Delhi NCR, Bengaluru, Hyderabad, Kolkata, and Pune and has scaled faster than any previous category launch by the company. As of October 2025, Insta Help fulfilled 4.68 lakh monthly orders with an average order value of Rs 184, with customer demand outpacing supply in most markets.

How did Insta Help affect Urban Company’s profitability?

Urban Company said it is still in the early phase of scaling Insta Help and that the category’s steady-state unit economics will take time to mature. Early losses were primarily driven by investments in partner training, early earnings support, and selective discounting to accelerate adoption.

“We recognise that these upfront investments impact short-term profitability. However, the opportunity is significant and immediate, and we are committed to maintaining clear market leadership,” the company said.

Despite the near-term drag, management said the focus remains on building long-term scale and network efficiency. As utilisation rates and repeat usage improve, Urban Company expects margins to recover gradually.

Why is the company investing heavily in this vertical?

Urban Company views Insta Help as a strategic extension of its core platform, designed to increase how often customers use its services. While beauty and appliance repair bookings are occasional, daily cleaning represents a recurring need, giving the company a more predictable revenue stream.

The company also said Insta Help helps improve income stability for its service partners, offering more consistent work compared to episodic bookings. Over time, it expects this vertical to deepen customer relationships and drive cross-selling across categories.

How does competition factor into this bet?

Urban Company’s push into daily cleaning coincides with rising competition in India’s on-demand home services space, as several startups gain investor backing to capture the same market.

In October, Snabbit, a Bengaluru-based home services startup, raised $30 million in Series C funding led by Bertelsmann India Investments at a $180 million valuation, to expand its same-day repair and cleaning network. Others such as Pronto and Pync are also expanding across metros, building subscription-based cleaning and quick repair models.

This surge in funding underscores growing investor interest in “quick home services”, a category many see as the next urban convenience battleground after food and grocery delivery. Urban Company’s early entry, brand trust and professional network give it an advantage, but management acknowledged that competitive intensity will remain high in the near term.

What’s next for Insta Help?

Urban Company said it will continue to expand coverage within existing cities before launching in new ones, focusing on high-density residential clusters. The company expects steady improvement in unit economics as order density, partner utilisation, and training efficiencies improve.

“We see a substantial opportunity for a trusted, tech-enabled, and quality-first platform like Urban Company to establish clear leadership,” CEO Abhiraj Singh Bhal said. “Our focus will be on scaling with sound unit economics and eventual profitability.”