Tips Music (TIPSMUSIC) Q3 25/26 earnings summary

Executive summary

• Strong content usage momentum and a large music catalogue in over 25 languages support 20% revenue growth guidance and an upward revision of PAT growth guidance to 25% for FY26, up from 20% previously.

• Board approved a dividend of INR 5 per share, totaling INR 63.91 crore for the quarter and INR 166.18 crore for the year, fulfilling the commitment to return 100% of last year's PAT to shareholders.

• Significant expansion in music content portfolio with 108 new releases in the quarter, including 70 film and 38 non-film tracks.

• Maintains a debt-free balance sheet with INR 303 crore in cash and investments as of Q3 FY26.

• Unaudited financial results for the quarter and nine months ended December 31, 2025, were approved and reviewed with an unmodified conclusion by statutory auditors.

Financial highlights

• Q3 FY26 revenue was INR 94.29 crore, up 21% year-over-year from INR 77.7 crore in Q3 FY25; nine-month FY26 revenue reached INR 271.6 crore, a 17% increase from INR 232 crore in the prior year period.

• Operating EBITDA grew 34% to INR 74.5 crore, with margins rising to 79% from 72% year-over-year.

• PAT for Q3 FY26 was INR 58.7 crore, up 33% from INR 44.2 crore, with PAT margins at 62%.

• EPS for Q3 FY26 at INR 4.6, up from INR 3.5 in Q3 FY25.

• Employee expenses included a one-time impact of INR 96.7 lakhs due to new labor code implementation.

Outlook and guidance

• Revenue growth guidance for FY26 maintained at 20%, with PAT growth guidance revised upward to 25%.

• Content cost for FY26 expected to be around 18%, lower than the initial 25% guidance due to a movie shifting to next year; FY27 content cost expected to rise to 25-28%.

• Paid subscription revenue is growing at 40-50% and constitutes about 10% of total revenue; paid subscribers expected to more than double in three years.

• Digital advertising in India projected to grow at 19% CAGR through CY2026, with digital media to account for 61% of total ad spend.

• Interim dividend declaration signals confidence in ongoing cash flows and profitability.