Nykaa Share Price Falls Over 9% Despite Q4 FY2025 Revenue Growth

Market Performance

Nykaa's share price declined by more than 9% during Monday's trading. This drop came even as the company reported steady revenue growth for the fourth quarter of FY2025.

Business Update and Revenue Growth

Nykaa, an omnichannel player in the beauty and personal care sector, announced that its consolidated net revenue for Q4 FY2025 is expected to grow year-over-year in the low to mid-twenties percentage range. A similar growth rate is projected for the full financial year FY2025, indicating consistent performance across all quarters.

The company's beauty segment has maintained its strong momentum, and net revenue growth is also expected in the mid-twenties.

The beauty business's Gross Merchandise Value (GMV) is projected to grow in the low thirties, significantly ahead of overall industry trends.

GMV is expected to grow in the fashion business in the high teens. This comes alongside an improvement in the core platform business compared to earlier periods. However, net revenue from fashion is expected to be lower due to weaker performance from Nykaa's owned brands and a decline in content-related activities, which generally peak in the third quarter.

Operational Highlights

Several operational factors contributed to the company's performance in the quarter:

• Continued investments in customer acquisition, leading to higher order volumes
• Strong retail results, supported by same-store sales growth
• Expansion of the retail footprint, with 19 new stores added in Q4 FY2025

Nykaa also reported substantial contributions from its in-house and acquired brands under the broader House of Nykaa portfolio.

Financial Overview

Revenue:

• Q4 FY2025: Expected to grow in the low to mid-twenties year-over-year
• FY2025 (Full Year): Projected to maintain growth in the mid-twenties

Gross Merchandise Value (GMV):

• Beauty Segment: Expected to grow in the low thirties
• Fashion Segment: Expected to grow in the high teens

Net Revenue (Fashion):

• Projected to be lower due to underperformance of owned brands and a reduction in content-related activity

Summary

Nykaa's share price declined over 9% despite the company reporting consistent revenue growth and expansion efforts in the fourth quarter of FY2025. Strong performance in the beauty segment and growth in GMV across both beauty and fashion segments were key highlights. However, challenges within the fashion segment, mainly related to owned brands and seasonal content trends, weighed on the overall revenue expectations.