US-based Zoomcar Holdings on Thursday reported a 73% decline in net loss for the three months ended September 30, helped by lower expenses driven by headcount reductions in India.
The car-sharing marketplace reported a Q2 net loss of about $3.4 million compared with $12.4 million in the year-ago period.
Zoomcar also reported a 16% fall in net revenue for the quarter to $2.2 million, bogged down by a fall in revenue from services. While the total number of bookings rose by 7%, it was offset by a 2% decline in booking days and a 9% decline in gross booking value (GBV).
‘Booking days’ refer to the total days that a vehicle is booked by guests on Zoomcar’s platform while GBV measures the total dollar value of booking days booked on the platform, including upfront booking fees, value-added fees, guest and host platform fees, and other charges.
The company said it continued to take several measures to improve profitability in its peer-to-peer car which included a reduction of cash incentives paid to hosts and the introduction of cancellation fees for hosts and guests.
While these strategies helped in improving unit profitability, they tugged at the expense of reducing booking days growth.
The results come after Zoomcar’s board of directors approved a 1-for-100 reverse stock split which became effective on October 21.
Additionally, the regulatory filing of the Delaware-based company noted that Zoomcar’s cash position is critically deficient and that critical payments to operational and financial creditors of the company are not being made in the ordinary course of business. Due to these reasons, there is “substantial doubt about the company’s ability to continue as a going concern”, the filing added.
