Tanla Platforms Q2 net profit declines 9%, EBITDA falls 11% as indirect costs rise

The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the quarter fell 11% YoY to ₹175.4 crore. The company reported that the decline in EBITDA was primarily due to lower gross profit growth and a rise in indirect cost spending.

EBITDA margins for the quarter declined by 198 basis points (bps) YoY to 17.5%, while the net profit margin was 13%.

Revenue from the company’s digital platforms segment declined 7.7% YoY to ₹88 crore. However, Tanla Platforms stated that the digital platforms segment’s revenue grew by 16% YoY by excluding the Vi impact. Meanwhile, revenue from the enterprise communications segment saw a marginal decline of 0.1% YoY to ₹912.7 crore.

During Q2FY25, the company saw a rise in cloud and hosting charges due to expenses towards the infrastructure revamp initiatives. The company also reported an increase in employee costs by ₹10.2 crore due to salary increments, net additions, and restricted stock units (RSU) costs. Further, the company upped spend on marketing and general expenses which were offset due to forex gains.

Uday Reddy, founder chairman, and chief executive officer of Tanla Platforms, said, that the company made strategic investments to drive future growth. The company has also managed to sustain growth and closed a deal with a leading Indian bank.

“With strategic investments in OTT, platform innovation, and investment for future growth, Tanla is positioned to drive impactful industry shifts. We closed another deal with one of the largest banks in India this quarter for Wisely ATP,” he said.

Shares of the company have declined by nearly 25.5% since the beginning of the year. The stock has lost over 20% in the past year.