PhysicsWallah staff falls as AI takes content work; profit doubles

PhysicsWallah, the listed edtech company, has said its employee and faculty numbers fell during the July to September 2026 quarter and linked part of the decline to efficiencies from artificial intelligence in content creation, quality checks, and test preparation and evaluation. Management made the remarks on the company's earnings call for the second quarter of financial year 2027, as reported on Monday, 9 November 2026. It gave no breakdown of how many people were laid off, resigned or reached the end of a contract, and did not say how much of the fall was due to AI. In the same quarter, revenue rose about 18% to Rs 1,242.26 crore and net profit roughly doubled.

PhysicsWallah built its name on low-cost online coaching and then expanded fast into physical classrooms across India. Its latest numbers show both sides of that strategy. The online business is growing quickly and profitably, while the offline centres, with their rent and staff costs, still lose money. Using AI to make study material, check questions and evaluate tests is one way the company is trying to grow without adding staff at the same pace.

The comments matter beyond one company. Edtech firms employ thousands of content writers, subject experts, reviewers and coders, many of them young graduates from smaller cities. If AI tools take over a large share of drafting questions, checking answers and writing code, these firms may need fewer people in those roles even as revenue rises. PhysicsWallah's own numbers show that pattern: revenue up about 18% while employee costs fell 2.3%.

There is a caution on how to read it. The company has not said how many jobs were cut, and some outlets have warned against treating the drop in headcount as confirmed layoffs. Part of the fall could be resignations or contracts ending, which are normal in teaching businesses. What is clear is that management chose to name AI as one reason, which signals the direction the company intends to take.

Peepals calculation: Revenue rose from Rs 1,051.24 crore to Rs 1,242.26 crore, about 18.2% (1,242.26 ÷ 1,051.24 ≈ 1.182), while net profit grew about 2.06 times (143.63 ÷ 69.72 ≈ 2.06). Online revenue made up about 56% of the quarter's revenue (694 ÷ 1,242.26 ≈ 0.56). The EBITDA margin improved to about 28% from about 22% a year earlier (348 ÷ 1,242.26 ≈ 0.28; 228 ÷ 1,051.24 ≈ 0.22). Our calculation from the reported figures.

Short-term: Staff in content, quality-check and evaluation roles at PhysicsWallah, and at rivals that follow the same path, face a tighter job market. Investors will look for detail on AI savings and the offline plan at the 18 November Investor Day.

Long-term: If AI keeps cutting the cost of making and checking study material, online coaching could become cheaper to run and more profitable, while hiring shifts towards people who can manage and check AI output. Classroom centres will still depend on teachers and space, which AI cannot replace.

Who is affected: PhysicsWallah employees and teachers, job seekers in edtech content and coding roles, students who use its online and offline courses, rival coaching companies, and shareholders.

What to watch next: PhysicsWallah's Investor Day on 18 November 2026, where it is expected to explain how it plans to bring its offline centres close to breakeven.

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