Key Takeaways
- • Ola Electric reported a consolidated loss of 3.62 billion rupees ($38.66 million) for the three months ended September 30, narrowing from 4.18 billion rupees a year earlier, according to Reuters.
- • Second-quarter expenses fell 28.4% to 6.39 billion rupees following workforce restructuring, reduced warranty costs and tighter working-capital management.
- • Revenue fell about 39% to 4.21 billion rupees as unit sales dropped to 41,651 from 51,775 a year earlier, per vehicle registration data.
- • Consolidated gross margin slipped to 29.93% from 30.9%, and the company expects gross margin to decline further in the third and fourth quarters as it expands its dealer-store network, while operating margin is expected to improve meaningfully.
- • Management said in its shareholder letter that "demand is no longer our constraint, supply is," and it is working with supplier partners to scale output month by month.
Summary
Ola Electric's quarterly loss narrowed on Thursday, supported by restructuring and cost-control measures, according to Reuters. The electric-vehicle maker reported a consolidated loss of 3.62 billion rupees ($38.66 million) for the three months ended September 30, compared with a loss of 4.18 billion rupees a year earlier. The Bhavish Aggarwal-led company has implemented workforce restructuring, cut warranty expenses and tightened working-capital cost management in recent quarters as part of its effort to improve profitability. These steps contributed to a 28.4% decline in second-quarter expenses, which totaled 6.39 billion rupees.
Top-line pressure remains significant. The company sold 41,651 units in the second quarter, down from 51,775 units a year earlier, according to vehicle registration data, and revenue fell about 39% to 4.21 billion rupees. Ola Electric, once India's largest electric two-wheeler maker by sales, faces intensifying competition from peer Ather Energy and legacy automakers TVS Motor, Bajaj Auto and Hero MotoCorp.
Consolidated gross margin stood at 29.93%, compared with 30.9% a year earlier. The company said it expects gross margin to decline in the third and fourth quarters as it expands its dealer-store network, though it anticipates a meaningful improvement in operating margin.
In its shareholder letter, the company said, "Demand is no longer our constraint, supply is," adding that it is working closely with supplier partners to scale capacity and output on a month-by-month basis.
Top-line pressure remains significant. The company sold 41,651 units in the second quarter, down from 51,775 units a year earlier, according to vehicle registration data, and revenue fell about 39% to 4.21 billion rupees. Ola Electric, once India's largest electric two-wheeler maker by sales, faces intensifying competition from peer Ather Energy and legacy automakers TVS Motor, Bajaj Auto and Hero MotoCorp.
Consolidated gross margin stood at 29.93%, compared with 30.9% a year earlier. The company said it expects gross margin to decline in the third and fourth quarters as it expands its dealer-store network, though it anticipates a meaningful improvement in operating margin.
In its shareholder letter, the company said, "Demand is no longer our constraint, supply is," adding that it is working closely with supplier partners to scale capacity and output on a month-by-month basis.
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