Coworking operator Smartworks reported its first quarterly profit in Q3 FY26, posting a net profit of ₹1.2 crore. Strong revenue growth, improved margins, and rising enterprise demand supported the turnaround. The company also expanded its footprint, improved occupancy, and strengthened its supply pipeline for future growth.
Smartworks marked a key financial milestone in the December-ended quarter, turning profitable for the first time in Q3 FY26. The coworking space provider reported a net profit of ₹1.2 crore, compared to a net loss of ₹16 crore in the same quarter last year. The company had also posted a loss of ₹3.1 crore in the previous September quarter, making the latest performance a clear turnaround driven by scale and operating leverage.
Revenue Growth and Margin Expansion Drive Turnaround
The shift into profitability was supported by strong top-line growth and improved margins. Operating revenue for the quarter rose 34% year-on-year and 11% quarter-on-quarter to ₹472.1 crore. Including other income of ₹16 crore, total income stood at ₹488.2 crore. While total expenses increased 26% year-on-year to ₹486.6 crore, revenue growth outpaced costs, helping improve the bottom line. Normalised EBITDA surged to a record ₹85 crore, with margins expanding to nearly 18%.
Enterprise Contracts Strengthen Revenue Quality
Smartworks attributed the improvement in profitability to a higher share of large-format enterprise contracts and the growing contribution from mature centres. “Q3 FY26 represents Smartworks’ strongest quarter to date and confirms that the business has entered a compounding phase,” said cofounder and managing director Neetish Sarda. He added that growth was anchored in long-tenure enterprise deals and expansions from existing clients, improving the predictability and durability of revenues.
Portfolio Expansion and High Occupancy Levels
As of December 2025, Smartworks served over 770 corporate clients through 63 centres across 15 cities in India and Singapore. During the quarter, the company expanded its operational footprint to 15.3 million sq. ft., with mature centres reporting an occupancy rate of nearly 93%. Total committed occupied seats reached approximately 1.92 lakh during the quarter, pushing the monthly revenue run-rate close to ₹150 crore.
Strong Deal Pipeline and Large-Scale Deployments
On the supply side, Smartworks signed letters of intent for large office spaces spanning 1.7 million sq. ft. across core growth markets. The company also closed deals for large deployments with BFSI and IT clients, underscoring continued enterprise appetite for managed office solutions. Notably, the 1,000-plus seat cohort contributed nearly 35% of rental revenue in Q3, highlighting the increasing scale of client requirements.
Positive Outlook Backed by Supply Visibility
Looking ahead, Smartworks said it has already secured supply visibility for FY27, with sourcing underway for FY28. Sarda expects profitability, cash generation, and returns on capital to continue improving as operating leverage plays out across a larger base of mature centres. Reflecting investor confidence, Smartworks’ shares ended the trading session 1.13% higher at ₹479.10, capping off a landmark quarter for the coworking operator.
