Nazara Tech Posts 67% Revenue Jump, But Profits Slump in Q3

Gaming heavyweight Nazara Technologies saw mixed results in Q3 FY25, with soaring revenue but declining profits, according to its latest financial filing with the NSE.

The Mumbai-based company's operating revenue shot up 67% to Rs 535 crore, compared to Rs 320 crore in the same quarter last year. E-sports emerged as the biggest revenue driver, contributing Rs 232.6 crore (43.5%). Gaming operations brought in Rs 155 crore (29%), while ad tech added Rs 10.5 crore (2%).

Additional earnings of Rs 22 crore from interest and financial asset gains pushed Nazara's total revenue to Rs 556.6 crore for the quarter.

However, the company's aggressive expansion came at a cost. Total expenses jumped 76% to Rs 531 crore, with marketing costs seeing a dramatic 3.5X increase to Rs 145 crore. Content, events, and web servers remained significant cost centers, eating up Rs 169 crore (32%) of expenses, while employee benefits accounted for Rs 88.6 crore (17%).

The expense surge took a toll on the bottom line, with profits tumbling 53.6% to Rs 13.7 crore from Rs 29.5 crore in Q3 FY24.

The market's response was reflected in Nazara's stock price, which closed at Rs 930.65, valuing the company at Rs 7,957.18 crore ($916 million).

It looks like Nazara is currently focusing on growth and market expansion over profits.