Tanla Platforms (TANLA) Q1 24/25 earnings summary

Executive summary

• Achieved 10% year-over-year revenue growth to INR 10,022 Mn in Q1 FY25, with sequential revenue flat due to seasonally weak quarter and driven by Enterprise Communications.

• Gross margin percentage improved both year-over-year and sequentially, with gross profit up 11.7% YoY to INR 2,694 Mn and margin at 26.9%.

• PAT rose 4.3% YoY to INR 1,412 Mn; EPS at INR 10.50, up 4.3% YoY.

• OTT (rich media) revenue contribution rose from 18% to 20%, with 177% YoY growth and now contributing 19.9% of revenue.

• Board approved unaudited standalone and consolidated financial results for the quarter ended June 30, 2024.

Financial highlights

• Consolidated revenue from operations for Q1 FY25 was ₹100,220.49 lakhs, up from ₹91,111.21 lakhs in Q1 FY24.

• Exited ILD deal, impacting revenue by INR 120 crore and gross margin by INR 30 crore.

• Vodafone revenue dropped from INR 22 crore in Q1 last year to zero this quarter, with a similar impact on gross margin.

• WhatsApp business scaled from sub-INR 50 crore to nearly INR 150 crore per quarter, maintaining double-digit sequential growth.

• Free cash flow was INR 744 Mn, representing 53% of PAT.

Outlook and guidance

• Expecting domestic business to pick up in Q2 and Q3, following historical seasonality.

• RCS platform (MaaP) went live in July, with revenue expected to start in Q2 and scale meaningfully by year-end.

• Management highlights continued market leadership with ~35% CPaaS market share in India and strong customer retention.

• Consolidated results for Q1 FY25 are not directly comparable to Q1 FY24 due to the ValueFirst acquisition completed in July 2023.