Nazara Technologies Limited Q3 FY26 Earnings Call Summary

Summary

Nazara Technologies Limited - Q3 FY26 Earnings Call Summary Wednesday, February 04, 2026 11:00 AM IST

Event Participants

Executives 12 Ajay Pratap Singh, Akshat Rathee, Anupriya Das, Chris Jones, Jeff Amis, Nitish Mittersain, Rakesh Shah, Rohit Sharma, Senthil Govindan, Shreyes Menon, Stuart Dinsey, Terry Lee

Analysts 4 Bhavik (Invexa Capital), Jinesh Joshi (PL Capital), Pranav Mashruwala (Dolat Capital), Sachin Dixit (JM Financial)

Financials & KPIs

Geographic & Segment Commentary

• Gaming: Revenue reached ₹257 crores (+66% YoY) with a 25% EBITDA margin. Growth was driven by disciplined user acquisition via Centres of Excellence (COE) and strong performance in mobile gaming.
• Offline Gaming: The segment reported a high 36% EBITDA margin in Q3. Smaaash contributed ₹24.3 crores in revenue, while Funky Monkey added ₹6.1 crores with aggressive center expansion.
• Adtech: Revenue decreased 22% YoY in Q3 as the company exited low-margin managed services. However, EBITDA grew 26% YoY due to a shift toward higher-margin tech-enabled offerings.
• NODWIN (Associate): Revenue surged 58% YoY to ₹261 crores with ₹40 crores EBITDA. Performance improved following the cessation of the underperforming “Freaks 4U” German operations.

Company-Specific & Strategic Commentary

• Centers of Excellence (COE): Centralized units for UA, data analytics, and AI are now driving operational efficiencies across Kiddopia and WildWorks, helping lower CAC while increasing LTV.
• IP Expansion: Strategic focus on licensing world-class IPs; upcoming launches include ‘The Traitors’, ‘Big Brother’, and ‘Go Slinky Go’ to drive FY27 growth.
• Strategic M&A: Management remains committed to acquiring gaming studios and has made minority investments in nCore Games (FAU-G) and Rusk Media to tap into the Indian ecosystem.
• Product Innovation: Animal Jam was soft-launched on Roblox to unlock new audience platforms; AI integration is being piloted to enhance game components and development speed.

Guidance & Outlook

Risks & Constraints

Q&A Highlights

NODWIN Profitability

• Question: What led to the sharp EBITDA turnaround in NODWIN this quarter? (Jinesh Joshi)
• Answer: Performance was driven by the cessation of the “Freaks 4U” drag in Europe and the success of high-margin legacy IPs like Comic Con and Starladder, which recently won “Tournament of the Year” (Akshat Rathee).

Kiddopia Margin Dip

• Question: Why did Kiddopia margins decline to 9% this quarter? (Sachin Dixit)
• Answer: The dip is a “healthy sign” of increased investment in user acquisition. While CAC decreased to $35.80, the higher volume of acquired users will translate to revenue growth over their 2-year LTV (Nitish Mittersain).

Sportskeeda Traffic

• Question: How is the company addressing the decline in Sportskeeda traffic? (Kunal Bajaj)
• Answer: Management reduced costs by 32% YoY. While waiting for Google updates to re-rank the site, focus has shifted to other growing domains like Pro Football Network, which saw 58% YTD revenue growth (Ajay Pratap Singh).

Future Growth Drivers

• Question: Where will growth come from in FY27? (Bhavik)
• Answer: Growth will be anchored by new IP launches at Fusebox (The Traitors), the “Go Slinky Go” launch at WildWorks, and a robust pipeline of 5-6 new titles at Curve Games (Nitish Mittersain/Stuart Dinsey).

Key Takeaway

Nazara Technologies reported a resilient Q3 FY26, characterized by a strategic pivot toward high-margin IP ownership despite a 24.1% headline revenue decline caused by the deconsolidation of NODWIN. The core Gaming segment saw revenue grow 66% YoY, while consolidated EBITDA margins expanded to 16.7%. Strategic investments via the internal Centers of Excellence have successfully optimized Kiddopia’s user acquisition, lowering CAC to $35.80. While the “Real Money Gaming” associate (Moonshine) remains a drag on net profit due to a ₹30 crore loss, NODWIN’s turnaround and the stabilization of the Adtech business toward high-margin tech services provide a solid foundation. With ₹700 crores in cash, Nazara is positioned to pursue aggressive M&A and launch multiple new titles in FY27, targeting a sustainable EBITDA margin profile of over 20% in the mid-term.