India-Based Tech Provider Byju’s Misses Revenue Projection, Report Says
The most valued Indian ed-tech startup, Byju’s, has closed its audit for the financial year ending in March 2022, reportedly coming in with revenues for its core business at $429.18 million — significantly short of its projected revenue of $1.25 billion.
This is not the first time the ed-tech giant has missed its target, as revenue also came up short in the fiscal year ending in March 2021, according to TechCrunch.
The company also said that the most recent earnings before interest, taxes, depreciation and amortization loss for the core business decreased to about $270.9 million, a slight improvement from previous periods. The company has yet to file the financial accounts with the regional authority, TechCrunch reported.
Byju’s did not respond to EdWeek Market Brief’s request for comment. But in a statement to TechCrunch, company co-founder Byju Raveendran said the company had endured a turbulent period and sees reason for optimism.
“The takeaways from a uniquely belligerent year, which included nine acquisitions, are life-long learnings,” said Raveendran, chief executive of Byju’s, in a prepared statement, according to the publication.
“The core business has demonstrated good growth, underlining the potential of ed tech in India, the fastest-growing major economy. I am also humbled by the lessons [learned] in the post-pandemic world of readjustments. Byju’s will continue on the path of sustainable and profitable growth in the coming years.”
The announcement comes after a series of challenges that the Bengaluru-based startup has faced in recent months as ed-tech demand has cooled post-pandemic.
This includes the departure of chief financial officer Ajay Goel late last month, as well as a company auditing the firm, Deloitte, and three key board members in June.
This summer, Byju’s also settled a lawsuit brought by a group of lenders over a $1.2 billion loan. The lenders had accused the India-based company of “repeated and ongoing breaches” of a credit agreement when the organization had not provided them with updated financial data, among other complaints. Byju’s disputed the allegations.
Byju’s has drawn significant attention over the past few years and has attracted a torrent of venture capital from investors intrigued by its vows to greatly expand the reach of its interactive digital learning platforms.
In the midst of those pressures, Bloomberg reported this week that Byju’s is in advanced talks to potentially sell Epic! Creations Inc., its U.S.-based kids’ digital reading platform, for about $400 million to Joffre Capital Ltd.
This is part of a bigger plan to divest several companies it purchased in 2020 and 2021 to settle up with lenders, according to TechCrunch.
Funds from the sale, if it goes through, will help Byju’s pay down the $1.2 billion term loan, which the startup had taken out during the pandemic to support its global acquisition goals, and had proposed to pay back in less than six months through asset sales, people familiar with the matter told Bloomberg.
Though decisions have not been finalized, a deal could be locked in as early as this month, Bloomberg reported.
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