Snapdeal, the e-commerce marketplace, has made notable progress in its financial journey for FY24. The company achieved Rs 384 crore in revenue, reflecting a modest 2.1% growth over the previous fiscal year. More significantly, Snapdeal slashed its adjusted EBITDA loss by a remarkable 88%, moving closer to profitability.
Revenue Growth Driven by Diverse Streams
Snapdeal’s consolidated financial statements for FY24 revealed a revenue rise from Rs 372 crore in FY23 to Rs 380 crore. The company continues to leverage multiple revenue streams, primarily marketing services, e-commerce enablement, and ancillary sources.
- Marketing services: Despite being the leading contributor with Rs 252.55 crore, this segment saw a 9.6% decline year-on-year.
- E-commerce enablement: Revenue here climbed by 14.8%, totaling Rs 103.36 crore, as Snapdeal’s appeal among value-focused sellers grew.
- Other sources: Surged over eightfold to Rs 23.85 crore, showcasing the company’s efforts to diversify its income streams.
This balanced revenue approach underscores Snapdeal’s strategy to adapt to market demands while solidifying its position in the e-commerce landscape.
Sharp Cost-Cutting Measures Boost Financial Health
Snapdeal’s emphasis on cost optimization resulted in substantial savings across various expenditure categories:
- Employee benefits: Spending reduced by nearly half, dropping from Rs 307.53 crore in FY23 to Rs 158.4 crore in FY24.
- Advertising and promotions: Costs fell 23.5%, amounting to Rs 70.37 crore in FY24.
- Total expenditure: A sharp reduction of 21.4% brought total expenses down to Rs 540.76 crore.
These strategic cost-control efforts significantly contributed to Snapdeal’s ability to reduce its overall loss by 43.2%, bringing it to Rs 160.38 crore in FY24.
Adjusted EBITDA Loss Signals Profitability Nearing
While the headline loss figure remains, much of it stems from non-cash adjustments, such as the Rs 110 crore revaluation of a put option tied to Unicommerce investors. Adjusted for these factors, Snapdeal’s EBITDA loss narrowed to just Rs 16 crore—a sign of substantial operational improvement.
The company’s improved cash flow dynamics further reflect its steady progress toward sustainable financial health.
Stake Sale in Unicommerce Bolsters Liquidity
Snapdeal’s strategic reduction of its stake in Unicommerce played a pivotal role in generating liquidity. The company executed two major transactions in 2024:
- A secondary sale of 3.4% stakes in May/June, raising Rs 33 crore ahead of the IPO.
- An offer for sale of 9.2% stakes during Unicommerce’s IPO in August, generating Rs 81 crore.
These actions highlight Snapdeal’s proactive approach to optimizing its portfolio and supporting its journey toward profitability.
Snapdeal’s Outlook
With a sharper focus on efficiency and consistent revenue growth, Snapdeal is better positioned in the competitive e-commerce sector. While challenges remain, the company’s commitment to targeted cost reductions and diversified revenue streams marks a steady path forward.
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