Nykaa Q2 profit jumps 207% as premium beauty demand accelerates

By Olivia Hart

Nykaa’s second-quarter net profit surged 207% year on year (YoY) to ₹1.01bn (US$10.75 million), as premiumisation and accelerated customer acquisition strengthened the Indian retailer and brand owner’s beauty business.

Company revenue rose 28% to ₹30.06bn in the three months to September. Gross merchandise value (GMV), the value of merchandise sold through a retailer’s channels, reached ₹44.54bn in the beauty division for the quarter.

Nykaa’s ₹44.54bn beauty GMV included e-commerce, physical stores, business-to-business distribution and the House of Nykaa portfolio. The figures cover different scopes: GMV captures merchandise value across those routes, company revenue reached ₹30.06bn, and beauty net sales value (NSV) increased 28% YoY.

EBITDA (earnings before interest, taxes, depreciation and amortisation) in the beauty division rose 51% YoY. The division’s operating-profit measure therefore grew faster than both its 28% NSV growth and the retailer’s 28% revenue growth.

The spread between sales and profit is the clearest signal in the results. Net profit expanded far beyond the 28% increase in company revenue, while the beauty division’s 51% EBITDA rise outpaced its 28% NSV growth. Nayar’s later comments on marketing and overhead control provide the company’s stated explanation for that divergence.

What drove the beauty business?

Nykaa attributed the momentum to accelerated customer acquisition and premiumisation among existing customers, or a shift toward higher-priced products. In its results statement, the company said House of Nykaa continued to outperform, supported by strong innovation.

Celebrity makeup artist Namrata Son founded SimplyNam; the acquisition added the premium colour cosmetics brand to Nykaa’s beauty portfolio. The deal also brought another named brand into the retailer and brand owner’s line-up.

Falguni Nayar, Executive Chairperson, Founder and CEO, said: “Our performance this quarter reflects the strength of the Nykaa ecosystem, with each of our businesses contributing to growth and productivity gains. We continued to improve operational efficiency, particularly across marketing and overheads.”

She added: “Beauty and fashion are seeing accelerated growth, while House of Nykaa and wellness offer significant runway for long-term growth. We remain focused on building differentiated businesses that serve our consumers and deliver sustainable growth over the long term.”

How is Nykaa expanding its distribution?

Nykaa opened 14 new stores in six cities during the quarter, taking its retail footprint to 338 stores. The openings accompanied a broad retail launch programme covering international skin care, hair care and K-beauty brands.

Recent retail launches included French skin care brand Yves Rocher, hair care brands Oribe and &honey, and K-beauty brands Mamonde, Mediheal and Purito Seoul. Those additions brought the number of new brand launches this year to 330.

The store rollout gives the new labels physical points of sale, while the SimplyNam acquisition adds a premium colour cosmetics brand to the portfolio. Nykaa’s 338-store base, 330 new brand launches this year and delivery plan extend the same multi-channel strategy.

Nykaa Now, the on-demand delivery service, launched in August in 15 cities. The company plans to expand the service to 25 cities by the end of the 2027 financial year, taking it beyond its initial city footprint.

What will determine the next phase?

With 14 quarterly store openings, this year’s 330 brand launches and delivery expansion mapped through FY2027, Nykaa’s next test is whether it can preserve operating momentum without losing the efficiency gains behind the quarter’s 207% profit increase.