On Saturday, the Indian educational technology behemoth, Byju’s, announced that its core business revenue for the fiscal year ending March 2022 reached $429.18 million. This figure underscores that the most valuable Indian startup failed to meet its unaudited projection of $1.25 billion in revenue for the entire group that was made a year prior. Byju’s had previously missed its revenue target for the fiscal year ending in March 2021 and also faced delays in submitting its financial accounts during that period.
The startup, headquartered in Bengaluru, has yet to submit its financial accounts to the local regulatory authorities and has released only partial data through a press statement. Byju’s reported a reduced EBITDA loss of $270.9 million for its core business.
This shortfall in revenue projections and the prolonged delay in financial reporting mark the latest challenges faced by Byju’s. It has experienced the departure of its CFO, Ajay Goel, in the previous month, along with the sudden exits of high-profile auditor Deloitte and three key board members in June.
At least two significant Byju’s investors have expressed concerns about the company’s financial reporting and governance issues, but they have chosen to remain anonymous while awaiting clarification from the startup.
Byju Raveendran, co-founder and CEO of Byju’s, commented on the situation in a prepared statement, stating, “The takeaways from a uniquely belligerent year, which included nine acquisitions, are life-long learnings. The core business has demonstrated good growth, underlining the potential of edtech in India, the fastest-growing major economy. I am also humbled by the lessons learnt in the post-pandemic world of readjustments. BYJU’S will continue on the path of sustainable and profitable growth in the coming years.”
Prosus, an early backer of Byju’s that owns more than 9% of the company, publicly criticized the startup in July for its failure to evolve adequately and for disregarding the investor’s advice and recommendations despite repeated attempts. (Prosus also reduced Byju’s valuation to $5.1 billion.)
In June, Deloitte, in its resignation letter, stated that Byju’s had not provided any communication regarding the resolution of the audit report for the financial year ending March 31, 2021, and had not updated the auditor on the readiness status of the financial statements and the underlying books for the previous fiscal year.
Furthermore, Byju’s, which spent approximately $2.5 billion on acquiring various firms in 2020 and 2021, is currently exploring the sale of some of these businesses to settle its debts to lenders. Notable backers of Byju’s include Peak XV Partners, Lightspeed India, Sofina, BlackRock, UBS, and the Chan Zuckerberg Initiative.
