MakeMyTrip (MMYT) Swings to Loss Despite Revenue Growth Could Margins Become the Key Long-Term Challenge

• MakeMyTrip Limited reported results for the second quarter and first half of fiscal 2025, with quarterly revenue of US$229.34 million, up from US$210.99 million a year ago, but turning to a net loss of US$5.62 million after posting a profit of US$17.85 million in the prior year period.
• Despite generating higher revenues, the company experienced a reversal in profitability, highlighting a mixed performance in the most recent quarter.
• With MakeMyTrip’s recent swing from profit to loss despite revenue gains, we’ll consider how this impacts its longer-term earnings outlook.

We've found 22 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

MakeMyTrip Investment Narrative Recap

To be a MakeMyTrip shareholder, you need to believe that ongoing digital adoption and expanding travel demand in India and nearby markets will power long-term growth, even as competition and high customer acquisition costs challenge profitability. The recent swing from profit to net loss, despite higher revenue, does not materially change the biggest short-term catalyst: growing online travel bookings. The main risk remains that rising marketing spend and competitive pricing could keep margins under pressure.

Among recent updates, the Q2 earnings report stands out, highlighting that robust revenue growth does not always translate to stronger earnings, especially in a market where defending share can elevate costs. This result adds new urgency to management’s ongoing push for product innovation, such as AI-driven booking tools, which are intended to boost operating leverage and support sustained profit improvement.

Conversely, investors should be aware of how persistent high customer acquisition costs could limit margin recovery if competitive intensity stays...

Read the full narrative on MakeMyTrip (it's free!)

MakeMyTrip's outlook anticipates $1.8 billion in revenue and $288.3 million in earnings by 2028. This scenario requires a 22.2% annual revenue growth rate and an increase in earnings of $188.3 million, up from the current $100.0 million.

Uncover how MakeMyTrip's forecasts yield a $118.44 fair value, a 48% upside to its current price.

Exploring Other Perspectives

Three Simply Wall St Community members estimate MakeMyTrip’s fair value from US$43.78 up to an extreme US$180,922.76. While you weigh these sharply differing views, keep in mind that fierce competition and costly marketing could put pressure on net margins and affect actual performance.

Explore 3 other fair value estimates on MakeMyTrip - why the stock might be a potential multi-bagger!

Build Your Own MakeMyTrip Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your MakeMyTrip research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free MakeMyTrip research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate MakeMyTrip's overall financial health at a glance.

Ready For A Different Approach?

Our daily scans reveal stocks with breakout potential. Don't miss this chance:

• Uncover the next big thing with financially sound penny stocks that balance risk and reward.
• Rare earth metals are the new gold rush. Find out which 37 stocks are leading the charge.
• Trump's oil boom is here - pipelines are primed to profit. Discover the 22 US stocks riding the wave.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com