Did MobiKwik's Q2 Loss Widen by an Astounding 694%?
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Synopsis
MobiKwik's latest financial report reveals a staggering 694% YoY increase in net loss due to a fraud-related charge. Despite this, the company shows signs of recovery with reduced sequential losses and improved profitability metrics.
Key Takeaways
- MobiKwik's net loss surged by 694% YoY due to fraud.
- Revenue declined by 7% YoY to Rs 270.2 crore.
- EBITDA loss improved by 79% from the previous quarter.
- The company has initiated recovery measures worth Rs 21.9 crore.
- Stable expenditures indicate cost management efforts.
Mumbai, Nov 4 (NationPress) Financial technology firm MobiKwik disclosed on Tuesday a staggering 694% year-on-year (YoY) increase in its consolidated net loss for the second quarter (Q2) of FY26, primarily attributed to a one-off charge related to fraud.
The company's net loss escalated to Rs 28.6 crore, up from Rs 3.6 crore in the equivalent quarter of the previous fiscal year (Q2 FY25), as detailed in its filing with the stock exchange.
Nonetheless, this loss was reduced by 31.7% sequentially from Rs 41.9 crore in the June quarter (Q1 FY26).
During this quarter, the firm recorded an extraordinary loss of Rs 11.8 crore following the discovery of fraudulent activities involving several registered merchants and users.
These parties allegedly took advantage of a technical flaw in MobiKwik's system, executing unauthorized settlements totaling Rs 40.4 crore.
MobiKwik reported recovering Rs 21.9 crore, with an additional Rs 6.6 crore secured via court orders and merchant affidavits.
The remaining Rs 11.8 crore has been fully accounted for as an exceptional item in this quarter.
The company filed a First Information Report (FIR) in September and engaged a well-known advisory firm to perform an independent investigation into the incident.
MobiKwik clarified that the provisions for the fraud impacted profitability but did not influence revenue, which was recorded below the operational level.
The firm's operational revenue fell by 7% YoY to Rs 270.2 crore in Q2, compared to Rs 290.6 crore a year prior.
Revenue also saw a slight decrease from Rs 271.3 crore in the preceding quarter, as per its regulatory submission.
At the operational level, the firm reported an EBITDA loss of Rs 6.4 crore, a stark contrast to an EBITDA profit of Rs 6.8 crore in the same quarter last year.
However, this represented a 79% improvement over the Rs 31.2 crore EBITDA loss from the previous quarter, bolstered by cost-reduction strategies and decreased payment processing costs.
MobiKwik's total expenditures during this quarter amounted to Rs 285.7 crore, remaining nearly stable compared to Rs 286.9 crore in the corresponding period last year.
The firm generates revenue primarily from two business segments—payments (via merchant and convenience fees) and financial services (through collection fees, late payment charges, and penalty fees).
Point of View
MobiKwik's situation is a stark reminder of the vulnerabilities in the fintech sector. The company's proactive measures to address the fraud and their commitment to transparency are commendable. However, the substantial losses highlight the need for robust security protocols in financial technology to protect both companies and consumers.
NationPress
30/12/2025
Frequently Asked Questions
What caused MobiKwik's significant net loss?
MobiKwik's substantial net loss was primarily due to a one-time charge related to fraud, involving unauthorized settlements by registered merchants and users.
How does MobiKwik's Q2 FY26 revenue compare to Q2 FY25?
MobiKwik's revenue from operations fell by 7% YoY from Rs 290.6 crore in Q2 FY25 to Rs 270.2 crore in Q2 FY26.
What actions is MobiKwik taking following the fraud incident?
MobiKwik has filed an FIR, engaged an advisory firm for an independent investigation, and is actively recovering lost funds.
What was MobiKwik's EBITDA performance in Q2 FY26?
MobiKwik reported an EBITDA loss of Rs 6.4 crore, a significant improvement from the Rs 31.2 crore loss in the previous quarter.
How has MobiKwik's expenditure changed compared to last year?
MobiKwik's total expenditure for the quarter remained stable at Rs 285.7 crore, almost unchanged from Rs 286.9 crore in the previous year.
