Bluestone, a Bengaluru-based omnichannel jewellery retailer, reduced its net loss by 41% year-on-year to 34.7 crore rupee (US$4 million) in the quarter ended June 30, 2025.

The company’s operating revenue grew 41% year-on-year to 492.6 crore rupee (US$55.8 million) in the same period.

Expenses rose 29% to 538.4 crore rupee (US$61 million), driven by a 51% increase in employee costs, while ad and marketing expenses fell to 34 crore rupee (US$3.8 million) from 42.4 crore rupee (US$4.8 million) a year earlier.

Bluestone opened 17 new stores during the quarter, bringing its total to 292, compared with 203 a year ago.

The company went public on August 19, 2025 and debuted at a 1.5% discount to its IPO price.

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🔗 Source: The Economic Times

🧠 Food for thought

Implications, context, and why it matters.

Bluestone’s dramatic pivot reveals customer preferences in high-value retail

The company’s revenue mix has shifted dramatically, with offline sales now contributing 93.3% of total revenue in FY25, up from 84.4% in FY23, while online sales dropped from 15.6% to just 6.7%2. This transformation required significant capital investment, as Bluestone expanded from 155 stores in FY23 to 275 by FY25, demonstrating the costly nature of physical retail expansion2. The shift appears to be working operationally—same-store sales growth hit 18.4% in Q1, and Average Order Value increased to Rs 55,499 from Rs 45,084 year-over-year3. Bluestone’s experience highlights the challenge facing many online-first retailers in high-consideration categories—the eventual need for physical presence often requires substantial additional investment that can impact profitability timelines.

Strong operational metrics mask underlying profitability challenges for growth-stage retailers

Despite impressive operational improvements—41% revenue growth, 630% adjusted EBITDA surge, and turning cash positive at Rs 1.7 crore versus a Rs 36 crore cash loss last year—Bluestone’s annual losses actually increased 56% to Rs 221.8 crore in FY2512. This disconnect illustrates how quarterly improvements can coexist with annual losses, particularly when companies are investing heavily in expansion—Bluestone added 17 stores in Q1 alone while total expenses rose 29%1. The company’s customer acquisition costs appear to be paying off, with a 34.4% increase in customer base to 816,000 and higher average order values, but the path to overall profitability remains unclear3. Bluestone’s P/S ratio of 4.4 compared to competitors’ range of 0.9 to 4.1 suggests investors are paying a premium for growth metrics rather than current profitability4. The pattern reflects a common challenge in retail expansion where strong unit economics and operational improvements can coexist with overall losses due to the high fixed costs of scaling physical infrastructure. ……