Ola Electric’s auto business turns profitable for the first time in September quarter

Ola Electric said on Thursday that its automobile business made a profit for the first time in the quarter ending September 2025, marking a key milestone for the electric two-wheeler maker. The company reported a small pre-tax profit of 0.3%, compared with a 5.3% loss in the previous quarter.

This is also the company’s first quarter of positive EBITDA, which means it earned more from its core operations than it spent, before accounting for interest, taxes and depreciation. Ola Electric said its auto gross margin — the difference between what it earns from vehicle sales and what it costs to make them — rose by 5.1 percentage points to 30.7%, higher than most petrol two-wheeler companies.

Ola added that this progress came mainly from better cost control and improved efficiency rather than government incentives, which contributed only about 2% through the Production Linked Incentive (PLI) scheme.

During the July–September quarter, the company earned Rs 690 crore in revenue and delivered 52,666 vehicles. It said its strong performance reflected the benefits of doing much of its manufacturing and component design in-house.

Ola also reduced its spending: auto operating expenses fell to Rs 258 crore from Rs 308 crore a year ago, and total group expenses dropped to Rs 416 crore from Rs 451 crore. It expects these costs to keep falling over the next two years as it consolidates operations and adopts more automation.

For the second half of the financial year, Ola Electric is targeting about 1 lakh vehicle deliveries while maintaining a focus on profitability in a competitive EV market. It now expects full-year revenue of Rs 3,000–3,200 crore, with new Ola Shakti model deliveries beginning in the last quarter of FY26.

By the end of FY26, Ola expects to have gross margins around 40% and an EBITDA margin of 5% for its auto business. Its battery cell manufacturing unit will also start contributing to revenue from the fourth quarter, with margins expected to reach 30% by early FY27.

The update comes at a time when India’s electric two-wheeler market has slowed, with price cuts and tighter competition reducing overall demand. Independent reports show that Ola’s revenue fell 43% year-on-year to Rs 690 crore, but its net loss narrowed to Rs 418 crore from Rs 495 crore a year earlier. Despite the pressure, analysts see this as a potential turning point for Ola Electric’s business, as it posts its first-ever operating profit and works toward long-term financial stability.

-With inputs from PTI