Nykaa’s marketing expenses rose from Rs 1,690 million in Q2FY24 to Rs 2,365 million in Q2 FY25, marking a 40% YoY increase. Compared to Q1 FY25 (Rs 2,018 million), there was a 17% increase in marketing expenses in Q2 FY25. For H1 FY25, marketing expenses totaled Rs 4,383 million, compared to Rs 3,287 million in H1 FY24, an increase of 33% YoY.
In Q2 FY25, marketing expenses represented 29.1% of NSV for the Fashion vertical, up from 25.6% in Q2 FY24.
Strong content revenue from LBB (Little Black Book) also contributed to the overall increase in marketing spends.
Comparing sequential quarters, the Fashion vertical’s marketing expenses grew by 17% from Q1 FY25 (Rs 672 million), reflecting Nykaa’s continuous push in customer acquisition and retention for fashion.
Nykaa’s 2023 marketing overhaul signaled a shift away from a traditional CMO structure. Instead, the company opted for a dual-leadership model. Sudhansh Kumar heads performance marketing, focusing on data-driven strategies, while Suchita Salwan leads organic marketing, emphasizing creative initiatives. CEO Falguni Nayar oversees major decisions.
The company reported a 71.6% year-on-year increase in its net profit attributable to ₹10.04 crore for the quarter ending September 2024, compared to ₹5.85 crore in the same quarter of the previous fiscal year. On a quarter-on-quarter basis, the net profit grew by 4.1%.
The company’s consolidated revenue from operations for the quarter stood at Rs 1,874.74 crore, marking a 24.4% increase over the Rs 1,507.02 crore recorded in the corresponding quarter of the previous financial year. On a quarter-on-quarter basis, revenue grew by 7% from Rs 17,461 million in June 2024.
Gross Profit for the quarter stood at ₹8,210 million, growing 26% year-on-year (from ₹6,496 million last year) and 9% quarter-on-quarter (from ₹7,560 million).
Nykaa now operates India’s largest beauty retail network of 210 physical stores spanning 72 cities. There was ~25% YoY growth in retail space, including two new flagship stores launched in Mumbai and Delhi.
The company recently expanded its ownership stake in Dot & Key and Earth Rhythm and also expanded its innovative and industry-leading product portfolio in Kay Beauty, Nykaa Cosmetics, Wanderlust and more, driving significant growth in the quarter.
Nykaa Beauty Vertical launched 170+ new brands in Q2 FY2025. Some examples include YSL Beauty, one of the luxury colour cosmetics brands from L’Oreal, which was launched only on Nykaa. Dr Jart+, a Korean skincare brand from The Estee Lauder Company, is available only on Nykaa.
Nykaa’s distribution business Superstore by Nykaa continues to see strong GMV growth of 80% YoY as it continues to expand its operations across the country. The platform now serves over 235,000 transacting retailers across 1,060+ cities and towns. The business continues to see significant
improvement in profitability with contribution margin improving by 862 bps YoY, to -11.5% in Q2FY25 from -20.1% in Q2FY24.
Highlights
Investment in new customer acquisition payed off for Nykaa with growth of 31% YoY. The physical stores footprint is currently 210 stores with GMV growth of 37% YoY. The Superstore recorded 80% YoY as it continues to expand retailer network.
Fragrance category grew ahead of overall Beauty with 65% YoY GMV (Nykaa.com) and 105% YoY GMV (in stores).
Nykaa Fashion launched Foot Locker live on Nykaa Foot Locker India Website.
Despite increased expenses, Nykaa managed to maintain its profitability, with EBITDA growing 29% YoY to ₹103.7 crore, from ₹80.6 crore in Sep-23 quarter. This translates into an EBITDA margin of 5.5%, slightly up from 5.4% last year.