Unacademy reported an 80% jump in revenue to Rs 719 crore in FY22 against Rs 398 crore in FY21 while the company’s loss from operations widened to Rs 2848 crore in FY22, up from Rs 1537 crore in FY21, according to filings accessed from data platform Tofler.
The edtech's revenue contribution from its subsidiaries increased marginally in FY22, even as it reported a widening of losses for the financial year on the back of rising costs.
Over 91% of the edtech’s consolidated income comes from its parent company ‘Sorting Hat Technologies Pvt Ltd’ which include firms that Unacademy previously acquired such as Codechef, Anand Mani, Coursavy, among others.
Its subsidiaries, which include Prepladder, Graphy, among others, contributed a little over 8% in FY22.
In comparison, in FY21, Sorting Hat contributed to over 94% of Unacademy's total income. The remaining (about 6%) came from its subsidiaries including Prepladder, Ono Labs, Pilani Experts Technology.
However, this composition is likely to change to FY23 as the company has moved towards winding down many of units.
Below are the revenue and the loss incurred by Unacademy’s subsidiaries in FY22, including a few that it eventually shut down:
Prepladder: Unacademy acquired postgraduate medical entrance exam preparation platform Prepladder Pvt. Ltd in 2020 through a cash deal amounting to Rs 180 crore and a share swap amounting to Rs 16.3 crore. The company’s revenue stood at Rs 115 crore while its loss stood at Rs 144 crore.
Mastree (Ono Labs Pvt. Ltd): Unacademy purchased a majority stake in Mastree for Rs 54.7 crore in July 2020. Mastree’s revenue for financial year 2022 stood at Rs 2.5 crore while it made a loss of Rs 41.2 crore. The platform, however, is no longer operational.
Graphy Labs: Unacademy launched Graphy in June 2020. The edtech giant also acquired Spayee Labs Pvt. Ltd for Rs 107.28 in an all-cash transaction in October last year via Graphy and merged their operations. Graphy’s revenue for FY22 stood at Rs 8.9 crore while it made a loss of Rs 3.5 crore.
Graphy Inc – Graphy Inc was set up by Unacademy to expand Grpahy’s operations to the US. In FY22, the company made a revenue of Rs 0.01 crore while the loss stood at Rs 0.55 crore.
TapChief (Pilani Experts Technology Labs Pvt. Ltd.): In February 2021, Unacademy acquired a 57.95% stake in TapChief in an all-cash transaction for Rs 25 crore as well as investing Rs 26.3 crore in compulsorily convertible debentures. In FY22, the company increased its stake in Pilani Experts Technology to 84.24% from 57.95% by paying Rs 5.56 crore to acquire the additional 26.29% stake. TapChief’s revenue for the financial year 2022 stood at Rs 1.4 crore while the company added a loss of Rs 60.5 crore to Unacademy’s financials.
Rheo TV (FJS Tech Pvt. Ltd): Unacademy acquired 100% equity in FJS Tech Pvt. Ltd in an all-cash transaction for Rs 40.3 crore. Rheo TV posted a loss of Rs 2.6 crore with nil revenue for FY22.
SwifLearn (Incassable Technologies Pvt. Ltd): Unacademy acquired a 76% stake in SwifLearn in an all-cash deal of Rs 73 crore, with the deal coming into effect on 18 November 2018. The revenue of Swifleanr for FY22 stood at Rs 6.2 crore as it made a loss of Rs 17.4 crore.
Unacademy reported an impairment loss of Rs 143.16 crore in FY22 following the shutting down of four subsidiaries – its US unit Unacademy Inc USA, K-12 platform Mastree, Swiflearn parent Incassable Technologies Pvt Ltd and Rheo TV parent FJF Tech Pvt Ltd.
Meanwhile, Unacademy’s expenses grew over 82.4% to Rs 3703 crore during the year-ended 31 March 2022 against Rs 2030 crore in the year before. In FY22, about a third of these expenses were due to costs related to employee share-based expenses. Such costs increased to Rs 1,141 crore in FY22 from Rs 474 crore in FY21.
The edtech’s expenses were primarily two-fold.
A) Employee benefits expense: Unacademy spent Rs 1772 crore in employee benefits expense in FY22, up from Rs 749 crore in FY21. This includes costs related to salaries and wages, ESOP costs, staff welfare expense, and contribution to provident and other funds.
Going into FY23, the edtech unicorn laid off nearly 600 employees comprising nearly 10% of its workforce in April, possibly with the aim to cut down employee costs.
B) Educator, advertising expenses: Unacademy’s other expenses increased to Rs 1803 crore in the financial year 2022 against Rs 1197 crore in FY21. Here is a breakup of other major expenses incurred by the company during the year under review.
- Educator charges increased to Rs 814 crore in FY22 from Rs 541 crore.
- In FY22, advertisement and marketing expenses grew moderately to Rs 549 crore from Rs 411 crore in FY21.
- Legal and professional charges jumped to Rs 154 crore in FY22, up from Rs 94 crore in the previous fiscal.
- Payment gateway charges stood at Rs 13 crore in FY22 against Rs 10 crore in FY21.