Meesho slashes losses by nearly half to Rs 1,675 cr in FY23, revenue grows 77% to Rs 5,735 cr

Meesho results: Meesho, the low-cost e-commerce platform, has declared a significant surge in revenue from operations, soaring by an impressive 77 per cent from Rs 3,232 crore in FY22 to a substantial Rs 5,735 crore in FY23. This remarkable growth was attributed to increased transactions by existing customers and successful monetisation efforts throughout the year.

A strategic diversification across various product categories played a pivotal role in propelling the company's overall revenue. Despite this substantial revenue hike, Meesho also managed to curtail its losses in the previous financial year. In a press release, Meesho revealed a noteworthy 49 per cent reduction in losses, scaling down from Rs 3,251 crore in FY22 to Rs 1,675 crore in FY23. However, it's important to note that Meesho has yet to officially file its final results with the Ministry of Corporate Affairs (MCA).

The Bengaluru-based company attributed its substantial reduction in losses primarily to diminished customer acquisition costs (CACs) and a strategic reduction in expenditures related to server and infrastructure components.

Furthermore, Meesho has achieved a noteworthy 50 per cent reduction in cloud costs, as reported in previous statements.

The implementation of cost-cutting measures, including two rounds of layoffs, has notably bolstered Meesho's unit economics, leading to increased confidence among investors and a subsequent hike in valuation. Meesho's valuation stood at $4.9 billion during its funding round in September 2021, where it raised $570 million. Interestingly, Fidelity Investments, a US-based Asset Management Company (AMC), raised Meesho's valuation slightly above $5 billion in August.

However, a secondary round had previously valued the Bengaluru-based company at approximately $3-3.5 billion, particularly when WestBridge was eyeing a 1-2 per cent stake in Meesho. As part of these developments, Venture Highway, an early supporter of the e-commerce entity, opted to dilute a portion of its stake in the company.

“Our performance in FY23, saw us achieve ambitious goals that we had set for ourselves. We were among the first movers to adopt a discovery-led product interface, keeping in mind the needs and preferences of our user base – Most of whom are new to online shopping,” Meesho said in a statement.

“The revenue from operations in just these six months exceeded the full year revenues of FY22. The business continued to demonstrate sustainable growth. Meesho has been able to optimise the Selling, General & Administrative expenses (SG&A) significantly on the back of its high mindshare with consumers resulting in organic traction as well due to the significant operating leverage inherent to a marketplace business,” the company concluded.