Urban Company’s InstaHelp push drags FY26 into loss

Urban Company Ltd swung to a loss again in 2025-26 as investments in quick home help vertical InstaHelp weighed on profitability, even as its home services platform posted its fastest growth in nearly four years in the March quarter.

Gurugram-based company’s revenue increased by 43% YoY ₹426 crore and 36% in March quarter ₹1,556 crore in the full financial year, while the net loss in the quarter ₹161 crore ₹3 crore a year ago. The loss included a one-time non-cash deferred tax asset expense. ₹61 crore and out of this the underlying loss before tax amounted to approx. ₹100 crore, the company said in its shareholder letter.

The company made a net loss for the entire year ₹235 crore in FY26 compared to net profit ₹240 crore in FY25.

InstaHelp hit

The biggest drag on profitability has been InstaHelp, which launches in 2025. The segment reported an adjusted EBITDA loss. ₹119 crore in the quarter. ₹61 crore loss in the previous quarter as the company increased spending on customer acquisition, subsidies, marketing and partner engagement.

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

In the analyst call, Bhal said that in an environment where competition is intensifying, the company prioritizes market share and scaling over short-term profitability. “We’re not optimizing for margins. We’re optimizing to win,” he said. “If we must be unreasonable at times, we must also be willing to be unreasonable.”

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This comes at a time when competition is increasing in the home services segment and rivals are raising fresh capital to scale aggressively. Snabbit recently raised $56 million at a valuation of around $350-390 million; Rival Pronto raised $20 million in new funding this week, doubling its valuation to $200 million.

Ambit Capital said in its March 24 report breaking news on Urban Company that increased competition from well-funded rivals like Snabbit and Pronto on InstaHelp could keep profitability under pressure for longer than expected. The brokerage said Urban Company had “the right to win” given its large user base, brand recall and cash reserves, but warned that “competitors’ high cash burn is likely to constrain profitability.”

The report states that Urban Company’s core business in India may face a slowdown in growth in the top eight cities, where penetration has already exceeded 50% of the target market and expansion into smaller cities and newer categories is critical to sustain growth. The brokerage firm expects InstaHelp to achieve breakeven only by FY31, compared to the company’s consolidated adjusted EBITDA breakeven target in 3Q28. EBITDA is an abbreviation for earnings before interest, taxes, depreciation and amortization.

Losses at InstaHelp are expected to remain high over the next few quarters as it prioritizes expansion in micro markets and heavier supply participation, the shareholder’s letter said, but reiterated its goal of reaching consolidated adjusted EBITDA breakeven by 3Q28.

This quarter, InstaHelp fulfilled 2.7 million orders as of March alone We exceeded 1.1 million orders. The business generated an NTV of: ₹40 crore in Q2FY26 ₹28 crore in the previous quarter.

strong core

Urban Company’s core consumer services business in India continued to drive growth. NTV increased by 26% annually ₹808 crore during the quarter, the fastest pace in 11 quarters, while revenue from the segment increased by 27% ₹288 crore.

Bhal attributed this momentum to a “faster, cheaper, better” strategy driven by denser supply networks and faster order fulfillment. “Once you cross the density threshold in a category and micro-market, service professionals are better localized, earnings increase and the cost to serve decreases,” he said.

The company has also begun offering “UC Instant,” which enables order fulfillment within 30-60 minutes on select services and micro markets.

Urban Company’s international business, which covers the UAE and Singapore markets, reported revenue as follows: ₹58 crore in the March quarter, up 89% year-on-year, while NTV increased 84%. ₹211 crore. Maintained segment profitability by reporting Adjusted EBITDA ₹compared to 4 crore ₹0.3 crore in the same period of the previous year.

However, growth in the UAE slowed towards the end of March due to the escalating global crisis. West Asian war. “During the last 3-4 weeks of the quarter, we saw a 15-20% drop in demand in the UAE as some users left the country,” the letter said.

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Urban Company’s Native products business, which sells water purifiers and smart locks, also continued to grow rapidly. Segment revenue increased by 75% year-on-year ₹70 crore in the March quarter, while NTV increased by 67%. ₹89 crore. Segment reported adjusted EBITDA loss ₹9 crore.