Ather Energy’s Loss Narrows in June Quarter

Bengaluru, August 4, 2025: Ather Energy Ltd (NSE: ATHERENERG | BSE: 544397) reported its performance for the quarter ended June 30, 2025 (Q1 FY26). Its revenue in the quarter increased y-o-y by 79%. EBITDA loss came down year-on-year by 12%. Net loss came down year-on-year by 2%.

Following the announcement, the shares of the company jumped by 12.81% or ₹44.50 to close at ₹391.80. The shares made an intraday high of ₹414.65 and a low of ₹349.35.

Key Financial Highlights (₹ in million)

In Q1 FY26, Ather Energy sold 46,078 units, marking a substantial 97% increase year-on-year, despite a marginal 3% quarter-on-quarter decrease from Q4 FY25. Revenue from operations reached ₹6,446 million, a 79% jump year-on-year from ₹3,606 million in Q1 FY25, though it saw a 5% decline quarter-on-quarter from ₹6,761 million. The company’s Adjusted Gross Margin significantly improved to ₹1,548 million, up 117% year-on-year from ₹712 million and 27% quarter-on-quarter from ₹1,215 million. This translated to an Adjusted Gross Margin percentage of 23%, a rise of 400 basis points year-on-year from 19% and 500 basis points quarter-on-quarter from 18%.

While still negative, EBITDA improved to a loss of ₹(1,060) million, showing a 12% improvement year-on-year from ₹(1,205) million and a 34% improvement quarter-on-quarter from ₹(1,607) million. Consequently, the EBITDA Margin also improved significantly, from -33% in Q1 FY25 to -16% in Q1 FY26 (a 1700 bps improvement year-on-year), and from -23% in Q4 FY25 (a 700 bps improvement quarter-on-quarter). The net loss narrowed to ₹(1,782) million, a 2% improvement year-on-year from ₹(1,830) million and a 24% improvement quarter-on-quarter from ₹(2,344) million.

The Net Loss Margin also saw substantial improvement, from -50% in Q1 FY25 to -26% in Q1 FY26 (a 2400 bps improvement year-on-year), and from -34% in Q4 FY25 (an 800 bps improvement quarter-on-quarter). Revenue per unit sold stood at ₹121,729, a 10% year-on-year decrease and a 4% quarter-on-quarter decrease. Non-vehicle revenue share increased to 13%, up 100 basis points year-on-year and 200 basis points quarter-on-quarter. The company’s Electric Two-Wheeler (E2W) market share pan-India reached 14.3%, marking a significant 670 basis points year-on-year increase from 7.6% and a 70 basis points quarter-on-quarter increase from 13.6%.

Operational & Strategic Highlights

Ather Energy demonstrated strong operational performance in Q1 FY26. The company sold 46,078 units, representing a substantial 97% year-on-year surge, although this was a marginal 3% dip from the previous quarter. Ather’s market share in the electric two-wheeler segment continued its upward trajectory, reaching 14.3% pan-India, a significant increase from 7.6% in Q1 FY25. Regional growth was also robust, with South India maintaining leadership at a 22.8% market share, Middle India’s share jumping 2.6 times year-on-year to 10.7%, and the Rest of India expanding its market share to 7.4%, nearly doubling from the previous year.

The company expanded its retail footprint by adding 95 new stores in the quarter, bringing the total count to 446. These new stores leverage compact and mid-size formats to facilitate faster scalability. Furthermore, Ather maintains India’s largest electric two-wheeler fast-charging network, with 4,032 points established as of June 30, 2025. Revenue from high-margin accessories and software subscriptions also saw healthy growth, with non-vehicle revenue reaching 13% of the top line, driven by popular accessories like boot organisers and frunks, and a strong adoption rate of 89% for AtherStack Pro software.

R&D and Margin Progress

Ather Energy continued to prioritise research and development, investing ₹890 million in Q1 alone, with 45% of its employees dedicated to R&D. The company’s patent portfolio expanded to 417 cumulative filings, underscoring its commitment to innovation. Financial margins also showed significant improvement. The adjusted gross margin reached 23%, an increase of 400 basis points year-on-year and 500 basis points quarter-on-quarter, attributed to successful value engineering, component cost optimisation, and a favourable product mix shift. The EBITDA margin improved notably from -33% in Q1 FY25 to -16% in Q1 FY26, reflecting tight control on operating expenses and a more profitable channel mix.

What Does This Mean For The Investors?

• Strong Growth Story: Ather’s 83% YoY revenue jump and 97% growth in unit sales highlight the company’s rapid expansion and growing demand for electric two-wheelers-making it a strong contender in India’s EV space.
• Improving Profitability: Despite still being loss-making, Ather significantly narrowed its EBITDA and net losses both YoY and QoQ. The EBITDA margin improved from -33% to -16%, suggesting it’s moving closer to breakeven.
• Market Share Gains: With a pan-India E2W market share of 14.3%, up from 7.6% YoY, Ather is cementing its position as a major player. Regional leadership in South and rising presence elsewhere signal sustainable growth potential.
• Store & Network Expansion: Adding 95 new stores in a single quarter and operating India’s largest fast-charging network (4,032 points) reflects strong execution and infrastructure-led scalability.
• Diversified Revenue Streams: Non-vehicle revenue-like accessories and software subscriptions- now makes up 13% of total income, adding margin resilience and potential for recurring revenue.
• Innovation-Driven Edge: Continued investment in R&D (₹890 million in Q1) and a strong patent portfolio (417 filings) demonstrate Ather’s long-term commitment to technology and product leadership.
• Positive Market Reaction: A 12.81% jump in share price reflects investor confidence in Ather’s improving fundamentals and growth prospects.
• Watch for Profitability Milestones: Investors will monitor upcoming quarters for continued margin improvement and signals of turning profitable, which could act as further stock price catalysts.

Strategic Outlook

Looking ahead, Ather Energy has several key strategic initiatives planned. The company is set to unveil AtherStack 7.0, the latest iteration of its in-house software suite, on August 30. Additionally, its new EL Platform and advanced LFP battery technology are both in advanced stages of development. These are expected to enhance product versatility, affordability, and battery performance and longevity. The company is also scaling up its Factory 3.0 as per schedule, which is anticipated to further improve manufacturing efficiency and output as it expands its product portfolio, including new, more affordable models.

About the Company

Ather Energy Limited is a prominent electric two-wheeler manufacturer headquartered in Bengaluru and listed on both NSE and BSE. Founded in 2013, the company is known for its premium electric vehicle (EV) scooters, including the popular 450 series and the family-oriented Rizta platform. Ather distinguishes itself through its vertically integrated technology, proprietary software (AtherStack), and a comprehensive fast-charging infrastructure network known as Ather Grid. It is one of India’s leading EV brands, maintaining a pan-India presence and consistently driving innovation-led growth within the burgeoning electric mobility sector.

REF:https://nsearchives.nseindia.com/corporate/ATHERENERGY_04082025151640_TouploadinvestorpptAug042025.pdf

Disclaimer:  At HDFC SKY, we take utmost care and due diligence in curating and presenting news and market-related content. However, inadvertent errors or omissions may occasionally occur.

If you have any concerns, questions, or wish to point out any discrepancies in our content, please feel free to write to us at content@hdfcsec.com.

Please note that the information shared is intended solely for informational purposes and does not make any investment recommendations