E-commerce giants adopt fiscal discipline to trim losses, stave off rivals

Firms are tightening spending, optimising supply chains, and expanding into smaller cities, positioning themselves for public listings as post-pandemic demand growth slows

India’s e-commerce industry is moving towards operational efficiency and more disciplined spending as the market matures and competition intensifies. To achieve those objectives, companies are leveraging technology-driven supply chains, optimising marketing outlays, and expanding into Tier-II and Tier-III cities to sustain revenue growth while cutting losses. The focus on cost control has become particularly critical for firms preparing for public listings.

 

Analysts say these strategies not only bolster profitability but also position platforms to navigate slowing post-pandemic growth, intensifying competition, and evolving consumer behaviour across urban and semi-urban markets.

 

Amazon narrows India losses sharply

 

Amazon’s India operations pared their losses in fiscal 2025 through tighter spending, even as revenue growth remained modest compared with pandemic levels. All four major business arms — Amazon Seller Services, Amazon Transport Services, Amazon Wholesale, and Amazon Pay — posted smaller losses, helped by lower advertising and employee expenses.

 

Amazon Seller Services, the marketplace arm of Amazon India, reported a 19 per cent increase in revenue from operations to ₹30,139 crore for the financial year ended March 2025, according to filings with the Registrar of Companies (RoC) accessed via data platform Tofler.

 

The unit’s losses narrowed 89 per cent to ₹374.3 crore, signalling improved operational efficiency at the e-commerce giant’s Indian marketplace business.

 

Amazon Seller Services generates revenue from third-party seller services, Amazon Prime subscriptions, and related marketplace offerings. The sharp reduction in losses reflects disciplined cost management and stronger revenue from marketplace services and advertising, highlighting the unit’s evolving business model beyond basic e-commerce transactions.

 

Marketplace services revenue climbed 21 per cent to ₹17,328 crore in FY25, accounting for 57 per cent of total operating revenue. Advertising revenue rose 25 per cent to ₹8,342 crore.

 

While total costs increased 6 per cent to ₹30,865 crore, Amazon implemented targeted expense reductions. Employee benefit expenses declined by ₹115 crore to ₹2,656 crore, while payment processor fees fell 15 per cent to ₹1,789 crore, reflecting greater transaction efficiency.

 

Amazon Transport Services reported an 8 per cent increase in operating revenue to ₹5,284 crore in FY25. With expenses rising only marginally, the unit’s loss fell to ₹33.9 crore from ₹80.3 crore a year earlier.

 

Amazon Pay (India), the online payments arm, reported a net loss of ₹866 crore during FY25, a 5 per cent decrease from the previous year. The firm reduced its total expenses by 6.7 per cent to ₹3,061 crore in FY25, while operating revenue declined 8.3 per cent to ₹2,097 crore from ₹2,287 crore in FY24.

 

Flipkart focuses on cost control, readies IPO

 

Rival Flipkart Internet, the marketplace arm of Flipkart, reported revenue of ₹20,493 crore in FY25, up 14 per cent year-on-year. Its net losses narrowed 37 per cent to ₹1,494 crore, according to RoC data. The growth marked a slowdown from the 21 per cent rise in FY24, after two consecutive years of more than 20 per cent expansion.

 

In FY25, advertising revenue rose 27 per cent to ₹6,317 crore from ₹4,973 crore a year earlier. Revenue from marketplace fees more than doubled to ₹7,751 crore from ₹3,734 crore in FY24. In contrast, income from logistics services fell sharply to ₹4,224 crore from ₹6,838 crore the previous year.

 

Total expenses rose 8 per cent year-on-year to ₹22,311 crore. Employee benefit expenses declined 8 per cent to ₹4,748 crore, while marketing costs surged 37 per cent to ₹4,100 crore, accounting for about 18 per cent of total expenses.

 

The Walmart-owned firm, valued at around $36 billion, is preparing for an initial public offering (IPO) by next year, according to sources.

 

Flipkart-owned fashion retailer Myntra reported an 18-fold surge in net profit for FY25, signalling continued strength in India’s digital fashion market. Myntra’s net profit jumped to ₹548 crore from ₹31 crore in the previous year. Operating revenue grew 18 per cent to ₹6,043 crore, while total expenses rose at a more modest 12 per cent to ₹5,724 crore.

 

Meesho leads by user base, eyes December IPO

 

Another firm, Meesho, became India’s biggest e-commerce platform by annual transacting users and order volume in FY25. The firm processed 1.8 billion orders in FY25, up 37 per cent from 1.3 billion in FY24. In the quarter ended June 2025, it recorded 561 million orders, reflecting a 50 per cent year-on-year increase.

 

For the fiscal year ended March 2025, Meesho’s operating revenue rose 23 per cent to ₹9,390 crore. The platform posted a net loss of ₹3,942 crore, largely due to a one-time tax payment linked to its shift in corporate domicile from the US to India, compared with a ₹328-crore loss in FY24.

 

Meesho reported a net merchandise value (NMV) of nearly ₹30,000 crore in FY25, up around 29 per cent from FY24. The NMV, calculated as gross merchandise value minus returns and cancellations but including taxes, was boosted by growing adoption in Tier-II and Tier-III markets as well as robust demand from major cities.

 

Meesho recently filed an updated draft red herring prospectus with the Securities and Exchange Board of India (Sebi), as it prepares for a December public listing, according to sources. The latest filing outlines plans to raise between $700 million and $800 million, including a primary share sale of $500 million.