Summary
OnMobile Global Limited - Q3 FY26 Earnings Call Summary Friday, February 6, 2026, 4:00 PM IST
Event Participants
Executives 3 Bikram Sherawat (President & COO), Francois Sirois (Executive Chairman & CEO), Radhika Venugopal (WTD & CFO)
Analysts 6 Amit Kumar, Ashish Bhasin, Jash Bhurjee, Jitendra Bhutoria, Revanth, Saurabh Upadhyay
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue | ₹136.9 crores | +4.5% QoQ; Driven by Gaming growth and steady Mobile Entertainment performance. |
| Gaming Subscription Revenue | ₹44.6 crores | +29.6% QoQ; Now accounts for 1/3 of total revenue. |
| Monthly Recurring Revenue (Gaming) | $1.6 million | Touched in Dec; Management targets $2 million in short term and $3 million long term. |
| Mobile Entertainment Revenue | ₹91.6 crores | -4.0% QoQ; Impacted by lower one-time licensing fees and specific product degrowth. |
| EBITDA (Normalized) | ₹8.1 crores | +16% QoQ (normalized for capitalization); Margin improvement due to operational efficiency. |
| PAT | ₹3.5 crores | Reported profit includes one-time exceptional gratuity cost of ₹0.46 crores. |
| Cash Balance | ₹138.5 crores | Gross cash; Management noted liquidity will be utilized for upcoming console launch. |
| Gaming Subscriber Base | 13.7 million | Flat QoQ; Higher revenue achieved via better mix and seasonal chargeability in Africa/ME. |
| Marketing Cost | ₹25.2 crores | +8.8% QoQ; +4.4% YoY; Higher spend to enter new markets in SE Asia and Middle East. |
| DSO | 123 days | Slightly higher due to festival/vacation season collection delays; expected to normalize in Q4. |
Geographic & Segment Commentary
- Gaming: Achieved a run rate of $1.6 million monthly revenue in December with a focus on reaching $2 million soon; growth driven by seasonal festival recharges in Africa and expansion in Southeast Asia. The segment hit a positive contribution margin this quarter, and management expects 10-15% sustainable QoQ growth.
- Mobile Entertainment: Remains the cash-flow foundation despite a 4% revenue dip; focus is on protecting margins and renewing long-term operator contracts before expiration. Management anticipates signing additional licenses in Q4 to balance recent softness.
- Regional Performance: Best performing regions were Middle East, Asia, and Latin America; currently in discussions with 6-7 new global telco customers for gaming launches.
Company-Specific & Strategic Commentary
- Gaming Console Launch: Developing a proprietary controller and “virtual console” box for D2C and B2B (operator) channels; targeting a price point below $60 to undercut traditional consoles (₹500+). Production is currently in China with active plans to shift to India to mitigate geopolitical risks.
- Buzzmo & Enterprise: Entering late-stage commercial discussions with three prospective leaders, specifically targeting the BFSI sector in Africa.
- DeOSphere Partnership: Project is currently “on ice” due to poor business case metrics and relationship issues; management has stopped booking revenue and cancelled planned $15M GPU investments.
- Chingari Investment: Operationally stable; management is in negotiations to begin partial divestment/share sales starting in FY27 to recoup capital.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Gaming Revenue Growth | ~50% for FY26 | Management remains confident in meeting the full-year target with one quarter remaining. |
| Gaming Profitability | Profitable by FY27 | Scale (expected $25M-$30M run rate) will allow profitability to compound starting April 2026. |
| Monthly Gaming Revenue | $3 million (18-month target) | Based on steady 10-15% QoQ growth of current subscription products. |
| Gaming Console | Launch in Q1 FY27 | Small-scale “test” launch planned initially to refine logistics, customs, and returns before scaling. |
Risks & Constraints
| Risk | Context |
|---|---|
| Execution - Hardware | Transitioning from a pure software/digital company to selling physical controllers involves logistics, returns, and inventory risks. |
| Geopolitical/Supply Chain | Dependence on Chinese manufacturing for controllers; management is seeking Indian partners to avoid “TikTok-style” sudden bans. |
| Working Capital | High DSO (123 days) and the need to finance hardware inventory/servers for the console launch may strain cash flows. |
| Competitive Response | Risk of Microsoft/Sony moving into low-cost cloud-gaming bundles, though management believes they currently lack the “retail ease” focus. |
Q&A Highlights
Gaming Console Strategy
- Question: Is this a competitor to Xbox/PlayStation and what is the price? (Revanth/Saurabh Upadhyay)
- Answer: It targets the “dreamer” market—millions who can’t afford $500 consoles. We offer a controller and 200+ games for ~$50-$60. It’s “plug and play” via cloud servers (Francois Sirois).
Financials & Capital Allocation
- Question: Why seek a QIP at low share prices if the business is profitable? (Jitendra Bhutoria)
- Answer: Current operations are profitable, but a successful console launch will require significant capital for hardware and servers. We won’t raise at ₹49; we’ll wait for console data to boost investor confidence (Francois Sirois).
Marketing vs. Subs
- Question: Why did marketing increase ₹2 crores while subscribers remained flat? (Revanth)
- Answer: Marketing spend is front-loaded when entering new markets (SE Asia/ME). Revenue grew 29% despite flat subs due to higher ARPU and transaction frequency during festivals (Radhika Venugopal/Bikram Sherawat).
Server Infrastructure
- Question: Where are the games hosted? (Saurabh Upadhyay)
- Answer: We host them on our own servers located in key markets (Bangalore, Delhi, Mumbai) to ensure low latency. We use game aggregators for a bouquet of 200+ titles (Francois Sirois).
Key Takeaway
OnMobile delivered a steady Q3 FY26, characterized by 4.5% sequential revenue growth and a significant 29.6% surge in Gaming subscription revenue, which now accounts for one-third of total turnover. While the legacy Mobile Entertainment business saw a slight 4% dip, it continues to provide the necessary cash flow to fund the pivot toward gaming. Strategically, the company is preparing for a high-stakes entry into the hardware space with a low-cost gaming console ($50-60 range) slated for a Q1 FY27 test launch, aiming to capture the massive “un-consoled” gamer demographic in India and Africa. Management effectively halted the DeOSphere project to protect margins and is looking toward Chingari exits as a future liquidity source. The forward outlook remains anchored on achieving a $3 million monthly gaming revenue run rate and transitioning the gaming segment to full profitability by FY27, though the capital-intensive nature of the upcoming hardware launch remains a key watch point for cash flow management.
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