Ather Energy Q3 Results: Losses Narrow to Rs 84.6 Crore as Revenue Surges 50%

Ather Energy, a prominent player in India's electric two-wheeler market, reported a significant improvement in its financial health for the third quarter ended December 31, 2025. The Bengaluru-based company saw its net losses narrow to Rs 84.6 crore, a sharp decline from the Rs 197.5 crore loss recorded in the same period last year. This 57% reduction in losses highlights the company's improving operating leverage and disciplined cost management as it scales its production and retail presence.

Revenue from operations for the quarter stood at Rs 953.6 crore, representing a 50% year-on-year growth compared to Rs 634.9 crore in the previous year. The growth was primarily driven by higher electric scooter deliveries and better realisations per unit. Including other income, the total income for the quarter reached Rs 995.7 crore. This performance follows a strong second quarter, indicating a consistent upward trajectory for the EV manufacturer.

Operational Growth and Sales Momentum

The company's sales momentum remained robust throughout the quarter. Ather Energy sold approximately 20,780 scooters in January 2026 alone, securing a 16.3% market share and ranking third in the national electric two-wheeler segment, according to Vahan portal data. This follows a high-volume second quarter where the company delivered 65,595 units, a 67% increase year-on-year.

The introduction of the Ather Rizta, a family-oriented scooter line, has played a pivotal role in expanding the company's addressable market beyond its performance-focused 450 series. By diversifying its portfolio, Ather has managed to capture a broader demographic, particularly in regions where family-centric utility is prioritized over high-speed performance.

Regional Performance and Market Share

Ather Energy has maintained a dominant position in South India, where its market share reached 25% in the first half of the fiscal year. However, the most significant growth is now coming from "Middle India," which includes states like Gujarat, Maharashtra, Madhya Pradesh, Chhattisgarh, and Odisha. In these regions, Ather's market share nearly doubled to 14.6% from 8.8% a year ago.

The company's expansion into the Rest of India has also shown promise, with market share rising to 10% from 6.1%. This growth is supported by a rapidly expanding retail footprint. As of late 2025, Ather operates 524 experience centres across the country, with plans to increase this number to 700 by March 2026. This aggressive retail strategy is designed to bring the brand closer to consumers in Tier-2 and Tier-3 cities.

Financial Metrics and Expense Management

While revenue grew by 50%, total expenses were contained to a 26.8% increase, reaching Rs 1,075.3 crore. This moderation in cost growth relative to revenue is a key factor in the narrowing of losses. Raw material and component costs remain the largest expense category as the company ramps up production to meet festive and organic demand.

Employee benefit expenses and other operating costs also saw an uptick as Ather continued to invest in engineering, manufacturing, and retail expansion. However, the company's EBITDA performance has shown steady improvement. In the preceding quarter (Q2 FY26), EBITDA margins strengthened by 1,100 basis points year-on-year to reach -10%, reflecting better unit economics.

The Ecosystem and Non-Vehicle Revenue

Ather's business model extends beyond vehicle sales. Non-vehicle revenue, which includes software subscriptions (AtherStack), charging services (Ather Grid), spares, and accessories, now contributes approximately 12% of the total income. This ecosystem-led approach provides a recurring revenue stream and enhances customer stickiness.

The Ather Grid fast-charging network has expanded to 4,322 points across India, Nepal, and Sri Lanka. This infrastructure is a critical differentiator, addressing range anxiety and supporting the adoption of electric vehicles in new geographies. Furthermore, 89% of Ather customers currently opt for the AtherStack Pro software package, highlighting the high value placed on connectivity and smart features.

Competitive Landscape: Ather vs Ola Electric

The electric two-wheeler sector in India remains highly competitive. Ather's close peer, Ola Electric, reported a consolidated net loss of Rs 418 crore for its September quarter, with revenue declining 43% year-on-year to Rs 690 crore. In contrast, Ather's consistent revenue growth and narrowing losses suggest a more stable path toward profitability.

While Ola Electric has pursued a high-volume, mass-market strategy, Ather has focused on premium positioning and operational discipline. This strategic divergence is becoming increasingly evident in their respective financial disclosures, with Ather showing stronger revenue momentum and better margin control.

Market Impact and Future Outlook

Market analysts have reacted positively to Ather's narrowing losses. The stock has seen significant interest, reflecting optimism about the company's ability to reach breakeven. However, challenges remain, including intense price competition and the rationalization of government subsidies under the FAME scheme. Any further reduction in subsidies could impact demand and force manufacturers to absorb higher costs.

Additionally, global supply chain issues, such as restrictions on rare-earth magnets, pose a risk to production timelines and incentive claims. Despite these hurdles, Ather's management remains focused on scaling production and expanding the retail network to capture a larger slice of the growing EV market.

Analysis Section

Ather Energy's Q3 performance is a clear indicator that the company is successfully transitioning from a high-burn startup to a more mature industrial player. The narrowing of losses to Rs 84.6 crore is particularly impressive given the aggressive expansion of its retail network. By maintaining a 50% revenue growth rate while keeping expense growth at roughly half that pace, Ather is demonstrating the classic benefits of operating leverage.

The shift in regional growth toward "Middle India" is a strategic masterstroke. While South India remains a stronghold, the rapid adoption in states like Maharashtra and Gujarat suggests that the EV transition is moving beyond early-adopter hubs. The success of the Rizta model further proves that Ather can compete in the family scooter segment, which is significantly larger than the performance niche it originally occupied.

Conclusion

Ather Energy has delivered a robust set of numbers for Q3 FY26, characterized by strong top-line growth and a significant reduction in net losses. With a market share of over 16% and a growing footprint of 524 stores, the company is well-positioned to capitalize on India's EV revolution. The focus now shifts to the final quarter of the fiscal year, where the company aims to further improve its EBITDA margins and expand its retail presence to 700 centres. Investors will be watching closely to see if Ather can maintain this momentum and achieve operational breakeven in the coming fiscal year.