Affle 3i Limited: Q3 FY26 Performance Driven by AI and Strategic Expansion

Affle 3i Limited, formerly known as Affle (India) Limited, has delivered a robust performance in the third quarter and nine months period ended December 31, 2025 (Q3 FY26 and 9M FY26), showcasing consistent growth and strategic execution. The company reported a consolidated revenue from contracts with customers of INR 717.5 crore for Q3 FY26, marking a significant 19.2% year-on-year (YoY) and 10.9% quarter-on-quarter (QoQ) growth. This strong top-line performance translated into impressive profitability, with EBITDA reaching INR 163 crore, a 24.1% YoY and 11.6% QoQ increase, and Profit After Tax (PAT) at INR 119.3 crore, up 19.1% YoY and 8.0% QoQ. The management highlighted Q3 FY26 as a milestone quarter, achieving the highest-ever quarterly EBITDA, PAT, CPCU conversions, and CPCU rate.

For the nine-month period (9M FY26), Affle 3i Limited recorded a consolidated revenue of INR 1,984.9 crore, growing 19.3% YoY. EBITDA for 9M FY26 stood at INR 448.9 crore, a substantial 28.5% YoY increase, while PAT grew 20.3% YoY to INR 335.3 crore. This consistent performance underscores the company's ability to execute effectively in a dynamic global environment, reinforcing the strength of its AI-powered Consumer Platform Stack. The company's focus on higher productivity and innovation has been a key enabler for these results, with EBITDA margin expanding for the seventh consecutive quarter sequentially, reaching 22.7% in Q3 FY26.

The Power of CPCU and Verticalization

The Cost Per Converted User (CPCU) business model remains central to Affle 3i Limited's success, contributing 99.5% of the revenue from contracts with customers in Q3 FY26. The CPCU business drove 119.7 million conversions at an average CPCU rate of INR 59.6, generating INR 714 crore in revenue. This represents a 19.6% YoY and 12.9% QoQ increase in CPCU revenue, reflecting the company's ability to deliver high-value outcomes for advertisers.

Affle's verticalization strategy has been a significant growth driver. The company is deeply engaged in high-growth industry segments categorized as E, F, G, and H, which collectively drive 100% of its revenue. These categories include E-commerce, Fintech, Entertainment, Foodtech, Edtech, FMCG, Gaming, Healthtech, Groceries, Hospitality & Travel, Government, and Home & Other Utilities. The diversified revenue mix across these verticals provides resilience against sector-specific challenges, such as the full-quarter impact of the Real Money Gaming ban in India, which resulted in an estimated INR 10-12 crore revenue loss compared to the previous year's Q3.

Geographically, India and Global Emerging Markets contributed 73.9% of the revenue, growing by 19.8% YoY. Developed Markets also demonstrated robust performance, growing 17.8% YoY and contributing 26.1% to the total revenue. This balanced growth across regions highlights the effectiveness of the company's localized compliant business model and its ability to adapt to diverse market dynamics.

Strategic Initiatives and Future Outlook

Affle 3i Limited is actively pursuing several strategic initiatives to sustain its growth momentum. The company has significantly deepened the role of AI across its unified Consumer Platform Stack. Niko, its advanced next-generation agentic AI optimization engine, enables fully automated self-service mode with real-time decisioning across bidding, targeting, and budget allocation, leading to superior ROI for advertisers. This AI-driven approach is a core differentiator, enhancing operational productivity and delivering hyper-contextual creative generation at an exponential scale.

Leadership expansion is another key strategic move. Sameer Sondhi has been onboarded as CEO for North America, with a dual role as Chief Strategic Investments Officer, aiming to accelerate organic and inorganic growth in developed markets. Concurrently, Vipul Kedia was promoted to Chief Operating Officer to anchor growth in India and emerging markets. These appointments are designed to align leadership with the company's ambitious 10x growth vision.

In terms of inorganic growth, Affle is evaluating four shortlisted companies for potential acquisitions, with plans for one meaningfully sized transaction in 2026 and further transactions in 2028 and 2030. This disciplined M&A strategy aims to unlock greater synergies and transform acquired units towards higher growth, profitability, and cash flows. The company's IP portfolio continues to expand, with three new patents filed in the current financial year, bringing the total to 39 unique patents filed, including 16 granted, further strengthening its competitive moat.

Affle 3i Limited also demonstrates proactive risk management, particularly concerning regulatory changes. The company is fully prepared for India's Data Protection Act, having adhered to global data protection standards for over a decade. Management views this as an opportunity to build consumer confidence and differentiate itself from smaller players.

Financial Summary Table (INR Crore)

(Note: All numbers are on a consolidated basis. Revenue from operations refers to revenue from contracts with customers.)

Outlook and Investor Confidence

Management guidance for the future remains optimistic. The company's internal key performance indicators target an average growth of 20-25% for both revenue and EBITDA. For FY26, an operating cash flow to PAT ratio of 85-95% is expected. While Q4 FY26 might see some seasonality, management anticipates resilient performance, potentially ranging from slightly below to slightly above Q3 levels, contingent on geopolitical stability. For modeling purposes, a revenue growth of 18-20% and an EBITDA growth of 23-25% are considered sensible.

Affle 3i Limited's Q3 FY26 results underscore its strategic clarity, sustained growth, and disciplined execution. The company's strong financial health, coupled with its leadership in AI-driven advertising and proactive market strategies, positions it for continued value creation and investor trust. The focus on verticalization, international expansion, and strategic acquisitions forms a robust foundation for achieving its long-term growth objectives.