Software-as-a-service (SaaS) company Zoho Corporation posted an operating revenue of Rs 12,313 crore in the financial year ended March 2025, up nearly 18% from Rs 10,456 crore in FY24, according to its consolidated financial statements sourced from the Registrar of Companies (RoC).

Where did the moolah come from? Zoho primarily derives revenue from the licensing of software products and subscriptions. These software licences can be divided into two categories:

1. Perpetual licence: Zoho charges a one-time, upfront payment that grants a customer the right to use a specific version of the company’s own developed software indefinitely, without needing to renew the licence. Customers must pay extra for any future updates, upgrades, enhancements, and technical support for such licence products, on an as-and-when-available basis.

2. Term licence: Zoho also generates revenue from selling on-premises term licences, which grant customers the right to use its software for a specified period.

The company also earns fees from subscription-based arrangements that provide customers with the right to access its software through a cloud-based infrastructure.

Product-wise performance: Zoho Suite remained the company’s biggest revenue generator in FY25, raking in Rs 7,051 crore, accounting for 57% of the total operating revenue. Meanwhile, ManageEngine brought in Rs 4,863 crore. Other products, including the instant messaging app Arattai, clocked revenue of Rs 399 crore in FY25, compared with Rs 47.3 crore in FY24.

Geographically, North America (revenue contribution of approximately 41%) continued to be Zoho’s largest market, followed by Asia (30%) and Europe (23%). The company also has a presence in Latin America, Africa, Australia, and New Zealand.

Total revenue, including other income of Rs 1,231 crore, rose 21% year-on-year (YoY) to Rs 13,544 crore during the period under review.

Decline in profit: Despite strong growth in its topline, Zoho reported lower profits in FY25. Its net profit declined by more than 3% to Rs 3,191.5 crore in FY25 from Rs 3,299 crore a year earlier.

The degrowth in the bottom line was mainly due to a sharp increase in expenses. The company’s total expenditure rose 30.5% to Rs 9216.6 crore in FY25 from Rs 7,061.6 crore in FY24.

Breakup of Zoho’s FY25 expenses

• Employee Costs: Jumped to Rs 4,347.2 crore, up 29% YoY
• Advertising and Promotional Expenses: Rose to Rs 2,230.3 crore, up 31% YoY

In May last year, Zoho pulled the plug on its chipmaking plans, including a proposed $400 million investment in a semiconductor plant in Karnataka.

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