E-commerce marketplace Meesho is preparing for a softer second quarter in terms of gross merchandise value (GMV) growth as it deliberately steps up investments in customer acquisition, signalling confidence that a stronger festive season will deliver sustained long-term gains.
In its shareholder letter for the first quarter of FY27, the company said it expects higher user acquisition spending and slower Net Merchandise Value (NMV) growth in Q2, largely due to the shift in the festive calendar and its strategy of expanding the platform’s user base.
“We are comfortable trading one quarter’s optics for a stronger festive season on a compounding platform. Every additional consumer, seller and data point makes the future growth more durable,” the company said.
Growth remains robust
The guidance comes after Meesho reported a strong start to FY27, with placed orders rising 29% year-on-year to 725 million, while NMV grew 34% to ₹11,614 crore.
The faster growth in NMV compared with orders reflects higher average transaction values, improved customer engagement and lower cancellations, aided by enhancements to the company’s TrustMesh risk-detection algorithms that filter high-risk orders and reduce Return-to-Origin (RTO) rates.
Contribution margin expanded to 4.6% during the quarter, driven by logistics cost efficiencies and improved monetisation of the platform.
Branded commerce gathers pace
One of the biggest growth drivers was Meesho Mall, the company’s branded products marketplace.
The platform, which now hosts more than 1,200 brands, recorded around 93% year-on-year growth in NMV, while the number of transacting consumers surged 88%.
Meesho has expanded the marketplace by onboarding national brands across beauty and personal care, baby care, health and wellness, grocery and fashion categories as it looks to strengthen its appeal among value-conscious consumers beyond unbranded merchandise.
The company said it plans to broaden branded product offerings across more price points and categories, allowing established as well as emerging brands to reach consumers in smaller towns and cities.
AI reshapes engineering
Beyond commerce, Meesho highlighted significant progress in embedding artificial intelligence across its technology operations.
The company said it has shifted much of its software development lifecycle—including code generation, testing and documentation—to AI agents, enabling engineers to focus on product specifications, reviews and business outcomes.
According to Meesho, the AI-led approach has already delivered more than two-fold productivity gains across its engineering teams.
Betting on Bharat
Meesho’s performance underscores the continued strength of India’s value e-commerce market, where increasing internet penetration, affordable smartphones and digital payments are driving online shopping beyond metropolitan cities.
The company is also seeing stronger consumer engagement through Content Commerce, its creator-led product discovery platform, and PRISM, its AI-powered recommendation engine, which has improved product discovery, personalisation and conversion rates.
With a cash balance of ₹6,521 crore, Meesho remains well-capitalised to invest aggressively in customer acquisition, technology and category expansion as competition intensifies in India’s rapidly evolving e-commerce landscape.