Zerodha brokerage revenue drops 40% in Q1 FY26

India’s largest stockbroker, Zerodha, is facing its first real earnings test after a record FY24. Founder Nithin Kamath revealed that brokerage revenues in June 2025 were down nearly 40% year-on-year, as regulatory changes and declining market activity weighed on the firm’s core business.

According to the graph shared in the blog post, the revenue and profits of the company witnessed a 10-15% decrease in FY25. However, the actual number for FY25 has not been disclosed by the company.

The drop comes after FY24, when Zerodha posted Rs 8,370 crore in revenue with over Rs 4,700 crore in profit, translating into margins of 55%. The prior fiscal, FY23, had seen revenue of Rs 6,875 crore and profit of Rs 2,907 crore, highlighting the explosive growth trajectory the company had enjoyed in the past three years.

Kamath said the June decline reflects the crystallisation of risks he had long flagged, which are higher STT on options, a reduction in weekly expiries, the removal of exchange transaction charge rebates, and the increase in BSDA limits. Together with a slowdown in retail trading activity, these changes are hitting earnings hard. “The risk has crystallised,” he said.

FY24’s performance, in contrast, benefited from soaring retail options volumes and operating efficiency. The company’s net worth stood at over Rs 13,000 crore with zero debt, and more than half of client funds were matched by net worth.

Zerodha is simultaneously expanding its non-broking operations. Its Margin Trading Facility (MTF) now has a Rs 5,000 crore book with 5% market share, and customer assets on the platform account for 10% of India’s retail and HNI AUM. 

Meanwhile, in the Indian stock market’s active user base, Groww continues to lead the stock broking space with 12.07 million active clients, whereas Zerodha retained its second position in August with 7.26 million clients and a 15.8% market share.