MakeMyTrip Earnings Call: Growth Engine vs. Headwinds

Makemytrip Limited ((MMYT)) has held its Q4 earnings call. Read on for the main highlights of the call.

MakeMyTrip Limited’s latest earnings call painted a largely upbeat picture, balancing robust multi-year growth, expanding margins, and strong cash generation against clear near-term turbulence from geopolitical and macro headwinds. Management acknowledged softer demand and airline capacity issues, but stressed that structural travel growth in India and disciplined execution continue to underpin the story.

Gross Bookings Surge on Structural Travel Tailwinds

MakeMyTrip’s gross bookings climbed to $10.4 billion in FY26, up from roughly $3.2 billion in FY22 and $6.6 billion in FY23, implying a powerful four‑year CAGR of about 34%. Management framed this trajectory as evidence of enduring demand tailwinds in India’s travel market, with the platform increasingly positioned as a key beneficiary of rising discretionary spending.

Revenue Growth and Margin Expansion Boost Profitability

IFRS revenue rose 10.7% year on year in constant currency for FY26, while results from operating activities (EBIT) jumped 30.1% to $156 million. Adjusted operating profit margin expanded to 1.82% of gross bookings from 1.71% a year earlier, signaling improving operating leverage despite a choppy demand backdrop and higher input costs.

Cash Machine with a Fortress Balance Sheet

The company generated $182.5 million of cash from operating activities in FY26, converting an impressive 97% of adjusted operating profit into cash. MakeMyTrip ended the year with more than $782 million in cash and cash equivalents, giving it ample firepower for investment, buybacks, and shock absorption if macro and geopolitical pressures persist.

Hotels and Packages Deliver Steady Volume and Margin Gains

Accommodation volumes in the quarter grew 15.2% year on year, with standalone hotels up 15.5%, underscoring resilient domestic travel demand. Gross bookings in this segment increased 10.8% in constant currency and adjusted margins rose 11.5% in the quarter, while full‑year hotel and packages adjusted margin growth reached 15.7% year on year.

Bus and Ground Transport Scale as Growth Pillars

Bus ticketing volumes surged 27.6% year on year in the quarter and 32.9% for the full year, confirming the category as a key growth engine beyond flights. Bus adjusted margin hit $41.1 million, up 17.1% in constant currency, while intercity cabs expanded more than 20%, broadening MakeMyTrip’s multi‑modal mobility footprint.

Ancillary Revenues Drive Higher Monetization

Adjusted margin from the “other” ancillary segment reached $25.4 million in Q4, up 27.1% year on year in constant currency, reflecting deeper cross‑sell and upsell penetration. For the full year, ancillary adjusted margins totaled $95 million, a 37.1% jump, highlighting growing share of wallet as customers adopt additional services around their core travel bookings.

AI and Product Innovation Sharpen Competitive Edge

The upgraded Myra assistant, now with multilingual voice and payment completion, handled more than 200,000 bookings in the quarter and scaled to 50,000–80,000 conversations per day. Users who interact with Myra show roughly 10% higher conversion than traditional flows, while AI tools now generate around 60%–70% of new code and digital voice agents resolve about 55% of flight and hotel queries.

Market Share and Distribution Reinforce Leadership

MakeMyTrip maintained a leading 30.8% domestic air ticketing market share in the quarter, gaining roughly 20 basis points despite industry headwinds. The platform now lists over 100,000 accommodation options across more than 2,050 cities and added room nights from about 12,000 new properties during the year, reinforcing its distribution depth and supply diversity.

Capital Allocation, Buybacks, and Strategic Bets

The group has completed $96.4 million of its $100 million buyback program, including repurchase of zero‑coupon convertible bonds, and bought back 0.9 million shares for about $50.3 million in the quarter. It also executed strategic deals, taking a majority stake in Flamingo Transworld, investing in Atlys alongside a visa arrangement, and merging redBus India into MakeMyTrip India as part of a longer‑term listing roadmap.

West Asia Conflict and Air Capacity Hit International Travel

Management flagged the West Asia conflict as a major drag on westbound international demand in March and into the June quarter, with international flown passenger traffic down around 6% year on year. This has weighed on international air ticketing and related accommodation bookings, muting growth in one of the platform’s higher‑value segments.

Domestic and International Flight Volumes Under Pressure

Both domestic and international flight departures contracted during the quarter, with domestic flown passenger traffic down about 1.5% year on year and international down roughly 6%. The weakness reflects capacity disruptions, higher fares, and softer discretionary outbound demand, constraining air‑related growth even as non‑air segments continued to perform.

Macro Headwinds from Fuel and Currency Movements

Elevated crude and aviation turbine fuel prices, together with a depreciating rupee, have lifted airline costs and airfares, compressing demand at the margin. The roughly 4.45% depreciation in the INR over the quarter triggered a $17.7 million translation‑related foreign currency loss, adding another layer of volatility to reported results.

Financing and One‑Time Items Add to P&L Volatility

Non‑cash interest expense on the company’s zero‑coupon convertible bonds totaled $27.6 million in the quarter, partially offset by a one‑time $30.6 million gain from changes in carrying value. Management noted that such bond‑related items continue to introduce noise into the profit and loss statement, even as underlying operating metrics trend positively.

Seasonal Softness, Demand Volatility, and Tough Comparables

April showed softness following March disruptions, and management expects the June quarter to face ongoing pressure from geopolitical and inflationary headwinds despite efforts to push domestic offerings. Comparisons are also complicated by a high base, including one‑off demand linked to major events in the prior year, which dampened reported growth rates across segments.

Listing Uncertainty and Airline Capacity Risks Loom

While internal restructuring and the merger of redBus India into MakeMyTrip India have progressed, the timeline and structure for a potential India listing remain unclear, subject to regulatory and structural workstreams. Airlines cutting international capacity in response to profitability pressures and fuel costs pose an added risk, potentially delaying a full recovery in outbound travel.

Guidance: Solid Medium-Term Ambitions Amid Near-Term Caution

Looking ahead, management said that under normal market conditions they expect revenue growth to run “in the 20s,” with adjusted operating‑profit margins held around 1.8%–2% of gross bookings, broadly in line with FY26’s 1.82%. They emphasized cash strength, segment momentum, and AI‑driven efficiencies as buffers against present geopolitical and macro headwinds, positioning MakeMyTrip to re‑accelerate when conditions normalize.

MakeMyTrip’s earnings call underscored a business that is structurally stronger, more diversified, and increasingly tech‑driven, even as external shocks weigh on near‑term growth. For investors, the key debate now centers on how long geopolitical and macro pressures persist versus how quickly the company can convert its AI, product, and cash‑rich position into sustained high‑teens to 20‑plus percent growth when skies clear.