BYJU'S net loss swells to Rs. 8,245 crore in FY22
What's the story
Embattled edtech unicorn BYJU'S has submitted its audited financials for FY22 to the registrar of companies (RoC) after a 22-month delay. The firm reported an operating revenue of Rs. 5,014 crore and losses amounting to Rs. 8,245 crore during FY22. BYJU'S total revenue reached nearly Rs. 5,300 crore, as per regulatory filings. The operating revenue saw a 119% growth in FY22, while losses increased by 80% during the same period.
Details
Stressed assets contribute to losses
Approximately half of the losses, around Rs. 3,800 crore, stem from struggling assets like Whitehat Jr and Osmo, two significant acquisitions made by BYJU'S. Nitin Golani, CFO of BYJU'S, stated, "While we are happy that our total income has grown 2.2 times, we are also aware of our underperforming businesses like Whitehat Jr and Osmo which contribute to 45% of the losses." "We have taken various measures to improve our operating financial conditions," Golani added.
What Next?
Auditor's observation on $1.2 billion term loan
BYJU'S auditor BDO noted a 'material uncertainty' regarding the $1.2 billion term loan but also mentioned that the management is working on securing funding through asset sales to clear debt. A note in BYJU'S audited financials for FY22 added, "And hence, (management) is confident regarding the future viability of the company." "Further, basis a legal opinion, the management is of the view that it is unlikely that the TLB loan will be required to be paid in the foreseeable future."
Insights
Valuation downgrades and layoffs
BlackRock, with a stake of less than 1% in BYJU'S, recently slashed the edtech unicorn's valuation to $1 billion from its early 2022 peak of $22 billion. In November 2023, Prosus devalued its stake in BYJU'S, leading to a valuation of under $3 billion, marking an 86% drop from its peak valuation. Over the past two years, the company laid off thousands of employees due to shrinking venture capital support and a drop in demand for online learning services.