PhysicsWallah Blames AI for Fewer Staff, Yet Headcount Is Above March

PhysicsWallah, the Noida edtech company listed in 2025, reported about 19,100 employees and about 7,100 faculty for the quarter ended Sept. 30, 2026, and management partly credited AI for a sequential decline, Entrackr reported on Nov. 9. Set against the company's own figures for March, the workforce did not shrink at all.

The cuts framing rests on a comparison with the previous quarter, which The Terminal has not seen. The only other headcount figure in the sources is from the end of the last fiscal year. Co-founder Prateek Maheshwari gave PTI, in a report carried by Outlook Business, 18,997 employees and 6,837 faculty on 31 May, after the FY26 results.

What the headcount numbers show

Measure	End of FY26 (PTI, May 2026)	Q2 FY27 (Entrackr, Nov. 2026)
Employees	18,997	about 19,100
Faculty	6,837	about 7,100
Offline centres	353	370

On those numbers employees are up about 100 and faculty about 260 in six months, a calculation from the two sources and not a figure either published. Offline centres rose by 17 in the same period, and Maheshwari told PTI in May that the earlier hiring came from opening 70 centres.

That May interview also complicates the AI story. Maheshwari said then that the company had not yet done much to use AI to cut employee costs, but that it would be a focus of the fiscal year. Management on the November call, per Entrackr, said AI now handles content creation, quality checks, test paper preparation and evaluation, and writes "around 90% of the company's code". That last claim is management's own and appears in Entrackr alone.

Two payroll figures that do not match

Entrackr reports employee expenses down 2.3 percent year on year in Q2 FY27, excluding ESOP costs, and down 2.4 percent for the half. Inc42 reports employee benefit expenses of ₹522.4 crore, up 10.4 percent from ₹473.1 crore a year earlier. Inc42 does not say whether its line includes ESOP costs. If it does, the gap between the two is share-based pay, not cash payroll, but neither outlet says so.

Technology spend ran the other way. Entrackr puts it at ₹104 crore in the first half, up from ₹70 crore a year before.

The profit and the offline drag

Consolidated operating revenue was ₹1,242.3 crore, up 18.2 percent from ₹1,051.3 crore, according to Inc42, and Entrackr gives net profit of ₹142 crore against ₹70 crore a year earlier. Inc42 lists ₹143.6 crore. Other income was ₹92.4 crore of the total income of ₹1,334.6 crore, so part of the profit is not from teaching.

Offline revenue grew 9 percent to ₹540.9 crore, while online grew 26.4 percent to ₹693.5 crore, per Inc42. Management blamed lower NEET enrolments and delayed exam notifications. Entrackr reports a pre-Ind AS EBITDA loss of ₹108 crore in the offline business for the half, against ₹120 crore a year before, and a plan to add 25 to 30 centres a year for two to three years.

Acquisitions and guidance

PhysicsWallah is in "advanced discussions" with a couple of fully online education businesses, Entrackr reports, with a budget below $20 million, in line with the ₹300 crore of IPO proceeds earmarked for unidentified acquisitions. Management expects M&A to add under 5 percentage points to growth against guidance of about 30 percent for FY27. Neither target is named.

PhysicsWallah's subsidiary Finz Finance also left lending and sold its loan portfolio to Auxilo Finserve for ₹95.8 crore in October, Inc42 reports.

The company has not published a quarter-on-quarter headcount table in anything The Terminal could fetch. Its Q3 FY27 results, due after the December quarter, will show whether 19,100 was the floor or the start of a decline.

For context on how Indian listed consumer-internet companies are using M&A, see The Terminal's coverage of MakeMyTrip's Quick Ride deal, and for how investors price rounds against revenue see the count of Nvidia's $100 million rounds.