Justdial reported a 9.7% year-over-year drop in net profit to ₹107.8 crore in Q2 FY27 even as its operating revenue grew 13.1% thanks to increased listings and platform activity, highlighting rising costs and market conditions affecting profitability.
- Net profit falls nearly 10% YoY to ₹108 crore despite 13% revenue growth
- Other income declines sharply due to bond yield movements in Q2 FY27
- Investments in AI, automation, and B2B expansion increase expenses by 15%
What happened
Justdial's net profit for the September 2026 quarter decreased 9.7% year-over-year to ₹107.8 crore from ₹119.4 crore in the same period last year. Sequential profit dropped 35.1% compared to ₹166.2 crore in the previous quarter. Revenue, however, grew 13.1% year-over-year to ₹342.8 crore and 4.7% quarter-over-quarter.
The decline in net profit primarily stemmed from a fall in other income, which decreased 25.6% YoY and 58.5% QoQ to ₹54.6 crore. This drop was linked to rising bond yields that adversely affected mark-to-market gains reported in earlier quarters.
Why it matters
The company’s operating EBITDA improved 4.1% year-over-year to ₹90.7 crore, but the operating EBITDA margin contracted by 228 basis points to 26.4%, reflecting higher expenses related to strategic investments. Operational costs increased 15% year-over-year to ₹262.8 crore, driven partly by expenditures on AI capabilities, automation, and broadening B2B services.
These investments underpin Justdial’s ambition to enhance its platform’s functionalities for merchants, focusing on digital presence management, customer acquisition, and business operations. The approach aims to strengthen core offerings amid evolving market dynamics and competitive pressures.
What to watch next
Going forward, Justdial intends to expand beyond local business discovery and lead generation by developing a marketplace of business services and AI-powered operational tools for merchants. Key product developments include JD Business and JD Omni, designed to help merchants manage campaigns, enquiries, and digital storefronts effectively.
The company’s progress in growing unique visitors, paid campaigns, and total active business listings will be critical indicators of traction. Additionally, monitoring how these new investments translate into improved merchant engagement and financial performance will be essential in assessing Justdial’s competitive positioning in India’s online services market.