Byju’s turning profitable, says CEO; expects loan issue resolution without court intervention

Edtech major BYJU’S is steadily and sustainably growing said CEO Byju Raveendran on Thursday (June 29) adding that the company is on the verge of achieving profitability at the group level.

The company organised a town hall with Raveendran to allay apprehensions about the uncertainty around the company’s growth and its future.

According to sources, who attended the town hall, Raveendran said that issues with USD 1.2 billion Term Loan B lenders are being resolved through discussion and hopeful of a positive outcome in the next few weeks without the court’s intervention.

Also read: Deloitte resigns as BYJU’S auditor, EdTech firm ropes in BDO for audit

“Byju shared that BYJU’S is close to achieving profitability at the group level, demonstrating the company’s commitment to financial management and optimisation of operations,” a source said, according to a PTI report.

He said that despite the challenges faced by tech companies globally, BYJU’S has made substantial progress towards this significant milestone.

BYJU’s had set a timeline to achieve profitability by March 2023.

“He said that BYJU’S is now growing slowly but sustainably and most of its business verticals are in good shape, relatively speaking,” the source said.

Several reports have emerged around BYJU’S financial performance, debt burden, delay in filing financial results and the latest being investor in the firm Prosus lowering valuation in the firm to USD 578 million for 9.6 per cent stake.

Prosus 9.6 per cent stake value pegs the edtech firms’ valuation at around USD 6 billion instead of USD 22 billion claimed by BYJUS.

Also read: ‘Byju’s workplace not toxic’: Co-founder shares ex-employee’s ‘thank you’ note

Amid all the controversies, a Delaware Court recently passed an order in favour of BYJU’S giving the company a significant boost in its fight against various controversies.

“Byju shared an important update that the TLB dispute is being resolved through constructive discussions, and the company is confident about achieving a positive outcome in the next few weeks without court intervention,” another source said.

Raveendran said that constructive discussion with lenders signifies the company’s ability to navigate challenges and find solutions through proactive engagement.

The CEO clarified to employees about the directors and auditor Deloitte’s resignation.

“Byju highlighted the strategic decision to appoint BDO as BYJU’S statutory auditors for the next five years which led to Deloitte’s exit. He said that a mutually agreed-upon decision has been taken to focus on efficient and timely audits going forward,” the source said.

Raveendran during the town hall said that the company is now actively expanding and diversifying its board to reflect the scale, scope, and reach of operations, which is a routine practice for large companies.

Also Read: Byju’s battles lenders in what could be aggressive defence or downward spiral

He touched upon concerns around the viability of edtech as an industry.

He said that edtech is not a pandemic phenomenon but a permanent fixture in education.

“Byju reassured that BYJU’S has weathered storms before and emerged stronger. He exhorted his team to rise above the noise and work with the resilience and determination that is found in the DNA of BYJU’S,” the source said.

Another source claimed that employees did not ask any questions about lay-offs and provident fund deposits.

“Raveendran said that the company has been under crisis multiple times and has come out stronger. So, they will come out stronger this time too,” the source said.

(With agency inputs)