Are Matrimony.com Ltd latest results good or bad?

Matrimony.com Ltd's latest financial results indicate a challenging operational environment. In Q2 FY26, the company reported a net profit of ₹7.76 crores, reflecting a significant decline of 41.03% year-on-year. Revenue for the same period was ₹114.59 crores, which represents a marginal decrease of 0.79% compared to the previous year. The operating margin also faced compression, dropping to 10.56%, a decline of 445 basis points year-on-year, while the PAT margin fell to 6.77%, down 462 basis points from the prior year. The results highlight a concerning trend of deteriorating operational efficiency, as evidenced by the substantial drop in operating profit before depreciation, interest, tax, and other income (PBDIT), which fell to ₹12.10 crores from ₹17.34 crores a year ago, marking a year-on-year decline of 30.22%. This decline in profitability is compounded by rising employee costs, which increased to ₹39.11 crores, representing 34.13% of revenue, indicating a loss of operating leverage. On a half-yearly basis, consolidated net profit for H1 FY26 was ₹16.16 crores, down 40.43% from ₹27.13 crores in H1 FY25, underscoring the persistent challenges in profitability. The company's return on equity (ROE) stands at 18.74%, while the return on capital employed (ROCE) is significantly below historical averages, indicating reduced capital efficiency. Additionally, the company has shown a heavy reliance on other income, which constituted 61.67% of profit before tax in Q2 FY26, raising concerns about the sustainability of its core business performance. The balance sheet remains healthy with zero long-term debt, but the sharp decline in promoter shareholding from 53.26% to 9.40% in Q2 FY26 raises questions about management confidence in future prospects. Overall, Matrimony.com Ltd's financial results reflect a company grappling with operational challenges and declining profitability, leading to an adjustment in its evaluation. The market context, characterized by rising competition and changing consumer preferences, further complicates the company's growth trajectory.