While revenue grew 50% YoY, a steep drop in other income and rising costs weighed heavily on DevX’s bottom line
Q2 Snapshot: Profits Fall, Revenue Rises
DevX, the newly listed coworking and managed office space provider, posted a net profit of ₹1.8 Cr in Q2 FY26, marking a 71% year-on-year (YoY) decline from ₹6.2 Cr in Q2 FY25.
Despite the fall in profit, operating revenue jumped 50% YoY to ₹51.8 Cr, compared to ₹34.5 Cr a year earlier. However, this also marked a 7% sequential dip from ₹55.6 Cr in Q1 FY26.
On a quarter-on-quarter (QoQ) basis, net profit improved sharply from just ₹14 Lakh in the previous quarter, indicating a recovery in operational performance.
Key Numbers: What Dented the Profit?
The profit plunge was largely due to:
- An 81.5% drop in other income, falling from ₹14.32 Cr in Q2 FY25 to just ₹2.7 Cr this quarter.
- A 26% YoY increase in total expenses to ₹52.8 Cr, up from ₹42.1 Cr.
Other financial highlights:
- Total income: ₹54.5 Cr (includes other income)
- EBITDA: Rose 45% YoY to ₹26.4 Cr, up from ₹18.2 Cr
- Cost of goods and services: Nearly doubled to ₹12.1 Cr, compared to ₹7 Cr last year
Segment Breakdown: Managed Offices Lead
DevX’s managed office segment generated ₹25.1 Cr, accounting for 46% of its revenue. These fully custom-built, exclusive office spaces differ from coworking models by being designed for a single enterprise client, handling everything from space acquisition to operations.
The rest of the revenue comes from:
- Coworking space solutions
- Design and build services
Geography & Expansion Plans
Notably, 75% of DevX’s revenue comes from tier II cities, showcasing strong demand for flexible workspace solutions beyond India’s metros.
To build on this momentum, the company is planning to open four new centres in:
- Ahmedabad
- Pune
- Surat
- Sydney (its first international location)
These will add a combined 3,199 seats to its portfolio.
IPO Funds: Strategic Allocation
Following its September IPO, DevX outlined capital deployment plans:
- ₹73.1 Cr for fit-outs at new centres
- ₹35 Cr for repayment/prepayment of borrowings
This indicates a clear focus on expansion and deleveraging.
Outlook: Growth Momentum vs Cost Pressures
While DevX’s revenue momentum remains strong, the dip in profits reflects the challenges of scaling operations, managing input costs, and the one-time impact of lower other income.
If operating leverage and segmental growth hold up, especially in managed spaces, the company may restore profitability in the coming quarters.
