Affle Q4 FY2026: CPCU scale drives steady growth and resilient margins

Affle 3i Limited closed Q4 FY2026 with another quarter of broad-based growth, built on the steady scaling of its performance-led CPCU model. Revenue from contracts with customers rose to INR 7,244 million, up 20.3 percent year on year. EBITDA increased in step to INR 1,612 million, also up 20.3 percent, while profit after tax grew 16.0 percent to INR 1,195 million.

For the full year, the picture stayed consistent: FY2026 revenue climbed 19.5 percent to INR 27,093 million, EBITDA grew faster at 26.3 percent to INR 6,101 million, and PAT rose 19.1 percent to INR 4,549 million. The company ended the year with EBITDA margin at 22.5 percent and PAT margin at 16.3 percent, reinforcing that growth has not come at the expense of profitability.

A key feature of the quarter was the mix of stability and scale. Quarter on quarter, revenue was nearly flat at plus 1.0 percent, and EBITDA softened slightly by 1.1 percent. But the year-on-year momentum remained intact across all quarters. That matters because it suggests Affle is not relying on one-off demand spikes, but on repeatable conversion volumes and disciplined execution.

Q4 performance: revenue growth holds, margins remain steady

Affle’s Q4 results show a business balancing growth with cost control. Inventory and data costs rose 25.6 percent year on year to INR 4,583 million, growing faster than revenue. This points to higher media and data inputs required to deliver rising conversion volumes. Employee benefit expenses grew at a slower 8.8 percent to INR 635 million, and other expenses fell 8.2 percent to INR 415 million. The combination helped EBITDA margin hold at 22.3 percent, almost unchanged versus 22.2 percent a year ago.

Below EBITDA, depreciation and amortisation increased 25.8 percent to INR 334 million, consistent with a technology platform that continues to invest and integrate capabilities. Finance costs declined sharply to INR 10 million from INR 24 million, and the balance sheet supports why: total borrowings were only INR 119 million as of March 31, 2026. Taxes rose in the quarter, with total tax at INR 285 million and an effective tax rate of 19.3 percent versus 16.8 percent in Q4 FY2025. That higher tax rate helps explain why PAT grew slower than EBITDA.

Market-wise, Q4 revenue split remained anchored in India and emerging markets at 71.6 percent, while developed markets contributed 28.4 percent. Growth was not concentrated in one geography. India and emerging markets grew 21.2 percent year on year, and developed markets grew 18.0 percent year on year. The mix reinforces Affle’s positioning as a global performance advertising platform, while still leaning on its strongest base.

The CPCU engine: conversions scale, pricing stays steady

Affle’s operating model is best understood through CPCU. In FY2026, 99.2 percent of revenue from contracts with customers was contributed by the CPCU model. This matters because it ties revenue to outcomes, not impressions. It also shapes investor expectations: the key growth levers become conversion volume and the average CPCU rate.

In Q4 FY2026, conversions rose to 120.3 million, up from 104.0 million in Q4 FY2025. The average CPCU increased to INR 60.0 from INR 57.8. Together, CPCU revenue reached INR 7,217 million in Q4, up from INR 6,007 million a year earlier. The company’s conversion trend also signals consistency. Every quarter in the provided series shows year-on-year growth in conversions, with Q4 conversion CAGR noted at 16.7 percent.

For FY2026, conversions reached 456.0 million, up from 392.8 million in FY2025. Average CPCU was INR 58.9 versus INR 57.5, and CPCU revenue rose to INR 26,873 million from INR 22,568 million. The data suggests that growth is primarily volume-led, supported by modest improvements in CPCU rate. That is generally healthier than relying on pricing alone, since it indicates expanding reach and increasing effectiveness across campaigns.

The quarterly trend supports the story. Revenue increased from INR 4,066 million in Q1 FY2024 to INR 7,244 million in Q4 FY2026. EBITDA rose from INR 781 million to INR 1,612 million over the same period. Margins also improved: EBITDA margin moved from 19.2 percent in Q1 FY2024 to 22.3 percent in Q4 FY2026, peaking at 22.7 percent in Q3 FY2026. This suggests scale benefits and cost discipline, even as inventory and data costs remain a large component.

Strategy and execution: vertical depth, platform stack, and cash strength

Affle’s strategic messaging in the presentation centers on powering 10x decadal growth through innovation, impact, and intelligence. The practical expression of that strategy appears in three areas: vertical focus, product and platform capabilities, and financial discipline.

First, the company emphasizes a verticalized approach across high-growth resilient categories that drive 100 percent of revenue, grouped into categories E through H. The list spans e-commerce, entertainment, edtech, fintech, foodtech, FMCG, gaming, groceries, government, healthtech, hospitality and travel, and home and other utilities. This kind of vertical depth can improve outcomes because targeting, creatives, and optimization models become tuned to repeatable use cases. The company also highlights direct customers as a meaningful base. Direct customer revenue rose to INR 19,985 million in FY2026 from INR 17,169 million in FY2025, although the share of revenue was stable at 74 percent.

Second, the platform narrative shows where Affle is placing its technology bets. The presentation positions Affle as a consumer intelligence driven global technology company, anchored on an AI-powered consumer platform stack. It highlights capabilities such as verticalized AI-powered ad intelligence, audience intelligence across connected devices, first party data integrations through a data management platform, and agentic AI automation for campaigns and creatives. The focus on fraud prevention, privacy compliance, and supply optimization is also a direct response to how performance advertising is evolving across mobile in-app, CTV, and digital out of home environments.

Third, cash generation and balance sheet strength add credibility to growth plans. Operating cash flow increased to INR 5,023 million in FY2026 from INR 4,260 million in FY2025. Cash and liquid investments stood at INR 17,921 million as of March 31, 2026, against total borrowings of INR 119 million. Total equity was INR 36,522 million. This structure gives Affle flexibility to invest in R and D, technology integration, and market expansion without leaning heavily on debt.

The multi-year record reinforces that this is not a single-year spike. Over FY2022 to FY2026, revenue CAGR was 25.8 percent, EBITDA CAGR was 30.1 percent, and PAT CAGR was 25.5 percent. EBITDA growing faster than revenue over the period is a useful signal that scale and operating leverage have been real.

What the case studies signal about demand quality

The presentation’s case studies add context to the numbers. They illustrate that Affle is not only scaling conversion volumes, but doing so across different verticals and geographies.

For Instacart, the objective was to convert high-value iOS shoppers in the US and drive first purchases. The results included a 46 percent increase in new converted shoppers and a 57 percent increase in first purchases, comparing February 2026 to February 2025, along with a 7 percent increase in shopper conversion rate. The operational takeaway is the emphasis on privacy-first predictive intelligence and source-level optimization in a developed market environment.

For Mytona, the focus was on reigniting conversions from existing gamers and improving ROI. The results include performance at 2 times over the ROI target and more than 380 percent growth in high LTV gamer conversions delivered through interactive ad templates. Here, the signal is that Affle’s platform can support repeat conversions and not only new user acquisition.

For Kissht in India, the objective was to scale high-intent borrower conversions and first loan actions. Reported outcomes include more than 200 percent increase in new borrowers conversion in Q4 FY26 versus Q4 FY25, more than 250 percent increase in first action, and 14 percent growth in borrowers completing high-value loan journeys. The theme across these examples is measurable outcomes across different intent types: first purchase, repeat conversion, and high-value actions.

Investor takeaways: steady compounding backed by cash and outcomes

Affle’s Q4 FY2026 results fit a familiar pattern for the company: consistent year-on-year growth, stable margins, and a conversion-led revenue engine. Revenue, EBITDA, and PAT all grew in double digits year on year in Q4, and the full-year performance showed faster EBITDA growth than revenue. That mix points to scale benefits, even while inventory and data costs continue to rise with volumes.

The core operating indicator is conversion growth. With FY2026 conversions at 456.0 million and Q4 conversions at 120.3 million, Affle is scaling usage of its CPCU model while keeping average CPCU largely steady, with modest uplift. The geographic mix also indicates resilience, with growth in both India and emerging markets and developed markets.

The balance sheet adds another layer of comfort. With INR 17,921 million in cash and liquid investments and minimal borrowings, the company has room to invest in its AI-led platform stack, privacy and fraud prevention, and vertical expansion. The strategy narrative emphasizes innovation and intelligence, but the financials show discipline: EBITDA margin held above 22 percent, and operating cash flow reached INR 5,023 million in FY2026.

The quarter’s theme is sustained execution. For investors, the key monitorables remain conversion momentum, CPCU pricing stability, and how efficiently the company manages inventory and data costs as it scales. If Affle continues to compound conversions while keeping margins steady, FY2026 looks less like a peak and more like another step in a long, outcome-driven growth cycle.