Urban Company’s InstaHelp push drags FY26 into loss

Urban Company Ltd slipped back into losses in 2025-26 as investments in its quick household-help vertical, InstaHelp, weighed on profitability, even as the home services platform posted its fastest growth in nearly four years during the March quarter.

The Gurugram-headquartered company’s revenue rose 43% year-on-year to ₹426 crore in the March quarter and 36% to ₹1,556 crore for the full fiscal year, while net loss during the quarter swelled to ₹161 crore from ₹3 crore a year earlier. The loss included a one-time non-cash deferred tax asset charge of ₹61 crore, and excluding this, the underlying pre-tax loss stood at around ₹100 crore, the company said in its shareholder letter.

For the full year, the company slipped into a net loss of ₹235 crore in FY26, compared with a net profit of ₹240 crore in FY25.

Consolidated net transaction value (NTV), the total value of customer orders on the platform after adjusting for discounts, refunds or incentives, rose 42% on-year to ₹1,148 crore in the fourth quarter, the highest growth in the last 15 quarters. Annual NTV rose 31% to ₹4,290 crore.

“Q4 was one of the strongest quarters we have ever had in the history of Urban Company,” Abhiraj Singh Bhal, co-founder and chief executive, said during a post-earnings analyst call. “We delivered our highest-ever consolidated NTV growth in 15 quarters and crossed 10 million orders for the first time in a single quarter.”

InstaHelp hit

The biggest drag on profitability was InstaHelp, launched in 2025. The segment posted an adjusted Ebitda loss of ₹119 crore during the quarter, up from a ₹61 crore loss in the previous quarter as the company stepped up spending on customer acquisition, subsidies, marketing and partner onboarding.

“InstaHelp is our highest priority. We are investing aggressively to cement market leadership and will continue to do so,” the company said.

In the analyst call, Bhal said the company was prioritizing market share and scale over near-term profitability amid intensifying competition. “We are not optimizing for margins. We are optimizing to win,” he said. “If we have to be irrational from time to time, we should be willing to be irrational.”

This comes amid rising competition in the home-services segment, with rivals raising fresh capital to scale aggressively. Snabbit recently raised $56 million at a valuation of about $350-390 million, while rival Pronto this week raised $20 million in fresh funding, doubling its valuation to $200 million.

Ambit Capital, in a 24 March report on initiating coverage on Urban Company, said rising competition in InstaHelp from well-funded rivals such as Snabbit and Pronto could keep profitability under pressure for longer than expected. The brokerage said Urban Company has a “right to win” given its large user base, brand recall and cash reserves, but warned that “high cash burn by competitors is likely to constrain profitability”.

The report said Urban Company’s core India business may face slowing growth in its top eight cities, where penetration has already crossed 50% of the target market, making expansion into smaller cities and newer categories critical for sustaining growth. The brokerage expects InstaHelp to break even only by FY31, compared with the company’s target of consolidated adjusted Ebitda breakeven by Q3FY28. Ebitda is short for earnings before interest, taxes, depreciation and amortization.

The shareholder’s letter said losses in InstaHelp are expected to remain elevated over the next few quarters as it prioritizes expansion across micro-markets and denser supply onboarding, but reiterated its target of achieving consolidated adjusted Ebitda breakeven by Q3FY28.

During the quarter, InstaHelp fulfilled 2.7 million orders, with March alone crossing 1.1 million orders. The business generated an NTV of ₹40 crore in Q4FY26, up from ₹28 crore in the previous quarter.

Strong core

Urban Company’s core India consumer services business continued to anchor growth. NTV rose 26% on-year to ₹808 crore during the quarter, the fastest pace in 11 quarters, while revenue from the segment rose 27% to ₹288 crore.

Bhal attributed the acceleration to a “faster, cheaper, better” strategy driven by denser supply networks and quicker fulfilment. “Once you cross a threshold density in a category and micro market, service professionals localize better, earnings improve, and the cost to serve comes down,” he said.

The company has also begun rolling out “UC Instant”, which enables fulfilment within 30-60 minutes across select services and micro-markets.

Urban Company’s international business, comprising the UAE and Singapore markets, reported revenue of ₹58 crore in the March quarter, up 89% on-year, while NTV surged 84% to ₹211 crore. The segment remained profitable, posting adjusted Ebitda of ₹4 crore compared with ₹0.3 crore in the year-ago period.

However, growth in the UAE moderated towards the end of March due to the escalating West Asia war. “In the last 3-4 weeks of the quarter, we saw a 15-20% drop in demand in the UAE, driven by some users leaving the country,” the letter said.

Urban Company’s Native products business, which sells water purifiers and smart locks, also continued to scale rapidly. Revenue from the segment rose 75% on-year to ₹70 crore in the March quarter, while NTV increased 67% to ₹89 crore. The segment reported an adjusted Ebitda loss of ₹9 crore.