Peak XV-backed edtech Cuemath's revenue drops 14% despite narrowing expenses
While Cuemath managed to cut down its expenses, its financials reflect a drop in business sales, hitting the topline significantly. The edtech recently sacked about 100 employees to improve efficiencies amid a challenging landscape for edtechs.
Edtech startup Cuemath’s consolidated net loss widened 8% year-on-year (YoY) to Rs 234 crore in the financial year FY23 while the revenues took a hit of 14%.
The company had registered a loss of Rs 216.6 crore last fiscal. The rise in Cuemath’s net loss was in line with the drop in revenues to Rs 126 crore in the financial year ended March 2023 from Rs 148 crore in the previous fiscal year.
Between March 2021 and March 2022, its expenses grew 1.6X on the back of employee benefit costs and legal fees. However, this time around, the total expenses dropped to Rs 360 crore from Rs 369.6 crore in FY22.
Whilemanaged to cut down on expenses, albeit marginally, its financials reflect a drop in business sales, hitting the topline.
Of its total income, the major earning came from teaching at Rs 119 crore. However, it decline from last year when Cuemath made almost Rs 132 crore from teaching, with the remaining coming from franchisee fees revenue, teachers onboarding fees, and sale of books.
All other streams of revenue also remained subdued in FY23.
Founded in 2013 by Manan Khurma and Jagjit Khurma, Cuemath offers mathematics-focused online learning programmes for K-12 students.
Amid a challenging environment for K-12 (kindergarten to class 12) edtech firms, the Peak XV Partners and Alpha Wave Global-backed learning platform recently sacked 100 employees as it looks to reduce costs.
It had sacked 100 employees in May last year as well to improve efficiencies.
In an email, Founder and CEO Manan Khurma had told employees, “…unfortunately, our revenue and cost trajectories are still divergent from expectations, and our problems are compounded by the bad macro situation around capital availability, particularly for edtech. This means that we will have to move to a leaner team structure, in which some roles will get redundant. That exercise is being carried out today.”
Cuemath had raised $57 million in June last year at a valuation of more than $400 million.
Edited by Kanishk Singh