Nazara Technologies Q3FY22 Results: Consolidated profit drops 17% to Rs 14.8 crore

Ace investor Rakesh Jhunjhunwala-backed gaming and sports media company Nazara Technologies on Friday reported a 17.31 per cent year-on-year decline in its consolidated net profit at Rs 14.8 crore in the quarter ending December 31, 2021. The company had posted a net profit of Rs 17.9 crore in the year-ago period.

The company's consolidated revenue from operations grew 42.48 per cent YoY to Rs 185.8 crore in the period under consideration against Rs 130.4 crore in the same quarter last year. Its EBITDA grew 14.17 per cent YoY to Rs 29 crore in the third quarter of the financial year 2022 against Rs 25.4 crore posted last year.

Manish Agarwal, Group CEO, said, "Nazara's strategy of having a diversified portfolio across business segments in gaming continues to provide us with a stable and strong platform on which we can continue to build future growth and success. Nazara continues to remain committed to building multiple growth levers across gamified learning, freemium, esports and skill-based real money gaming via growth in its current portfolio and the addition of more offerings in the 'Friends of Nazara' network through strategic M&A."

Key Metrics: Q3FY22 P&L Highlights

eSports: One of the fastest-growing segments with a surge in revenue and EBITDA. Nodwin, as well as SportsKeeda, are on a strong growth trajectory and integration of OML business into Nodwin and expansion into the Middle East via Publishme is giving further flip to the growth momentum in this segment.

The segment's revenue grew 89 per cent YoY to Rs 109.3 crore in December 2021 quarter against Rs 57.8 crore posted in December 2020 quarter. Its EBITDA grew 52 per cent to Rs 242 crore in the reported quarter against Rs 159 crore in the corresponding quarter last year.

▪ Gamified learning: Kiddopia saw an increase in active subscribers by 3,039 paying subscribers to a total of 327,738 subscribers at the end of Q3. The negative impact of Apple IDFA privacy policy changes on marketing spends has been stabilized and QoQ spends are now increasing.

The segment's revenue grew 1 per cent YoY to Rs 472 crore in December 2021 quarter against Rs 578 crore posted in December 2020 quarter. Its EBITDA declined 27 per cent to Rs 61 crore in the reported quarter against Rs 84 crore posted last year.

▪ Real Money Gaming: Our strategy around RMG segment is to first integrate HalaPlay and OpenPlay into one common tech platform and then going forward continue to look at building the segment through consolidation.

The segment's revenue grew 95 per cent YoY to Rs 107 crore in December 2021 quarter against Rs 55 crore posted in December 2020 quarter. Its EBITDA stood at Rs 1 crore in the reported quarter against a negative EBITDA of Rs 22 crore posted last year.

▪ Freemium: World Cricket Championship continues to be the largest mobile simulation cricket game, and we are exploring levers of growth in web 2.0 as well as web 3.0 to scale revenues of this segment. We are also looking at strategic M&A to add more IPs to this portfolio.

The segment's revenue declined 8 per cent YoY to Rs 57 crore in December 2021 quarter against Rs 62 crore posted in December 2020 quarter. Its EBITDA grew 17 per cent to Rs1 14 crore in the reported quarter against Rs 12 crore posted last year.