Nucleus Software Q4 FY26: Revenue Up, Profit Down YoY

Key takeaway from the March 2026 quarter

Nucleus Software Exports Ltd (BSE: 531209, NSE: NUCLEUS) reported audited standalone and consolidated results for the quarter and year ended March 31, 2026, approved by its Board and reviewed by the Audit Committee. The statutory auditors issued an unmodified opinion on both standalone and consolidated financial statements.

For Q4 FY26, the company reported consolidated revenue of INR 224.77 crore, slightly higher quarter-on-quarter but lower year-on-year. Profitability was mixed: net profit rose sequentially but fell sharply versus the year-ago quarter. Management also reiterated that it does not provide specific revenue or earnings guidance.

Q4 FY26 revenue: modest sequential growth

Consolidated revenue for the quarter stood at INR 224.77 crore, compared with INR 220.03 crore in the preceding quarter and INR 228.96 crore in the year-ago quarter. The company also disclosed foreign currency revenue (including India rupee revenue) of US$14.75 million for the quarter, against US$14.92 million quarter-on-quarter and US$16.53 million year-on-year.

On a segment basis, product revenue was INR 189.05 crore in Q4 FY26, versus INR 185.58 crore in Q3 FY26 and INR 199.56 crore in Q4 FY25. Projects and services revenue came in at INR 35.72 crore, compared with INR 34.45 crore quarter-on-quarter and INR 29.40 crore year-on-year.

FY26 revenue rose to INR 876.03 crore

For the full year, consolidated revenue increased to INR 876.03 crore from INR 832.25 crore in FY25. The company also disclosed foreign currency revenue of US$19.60 million for FY26 versus US$18.50 million for FY25.

Within that, product revenue for FY26 was INR 740.56 crore (FY25: INR 713.79 crore), while projects and services revenue rose to INR 135.47 crore (FY25: INR 118.46 crore). The revenue mix indicates product revenue remained the larger contributor, with projects and services showing faster growth on a year-on-year basis.

Costs and margins: delivery cost stayed elevated

In Q4 FY26, cost of delivery (including cost of product development) was 70.1% of revenue. This was broadly flat sequentially (70.4% in the prior quarter) but higher than the year-ago quarter (57.3%), signalling pressure on gross margins versus last year.

Separately, the company’s trailing twelve-month (TTM) income statement data showed revenue of INR 940.00 crore, cost of revenue of INR 589.00 crore and gross profit of INR 351.00 crore. The same dataset reported gross margin at 37.31% and net profit margin at 12.42%.

Profit and EPS: sequential rebound, year-on-year decline

Net profit for Q4 FY26 was INR 34.55 crore, compared with INR 20.70 crore quarter-on-quarter and INR 64.77 crore year-on-year. EPS for the quarter was INR 13.12, versus INR 7.86 in the previous quarter and INR 24.60 in the year-ago quarter.

For FY26, net profit declined to INR 116.74 crore from INR 163.00 crore in FY25. FY26 EPS was reported at INR 44.35, down from INR 61.40 in FY25.

The company also reported EBITDA of INR 34.62 crore for Q4 FY26, higher sequentially but down from INR 74.33 crore year-on-year. Full-year EBITDA fell to INR 124.15 crore from INR 167.60 crore.

Order book jumps above INR 1,000 crore

A key operational highlight was the order book position of INR 1,044.31 crore at year-end. This included INR 899.44 crore in product business and INR 144.87 crore in project and services business. The company described the order book as robust, with most contracts spanning multiple years, while also noting that revenue recognition can lag due to implementation cycles and contract complexity.

The order book was also reported as significantly higher than INR 656.68 crore at the previous quarter-end, suggesting a sharp improvement in contracted visibility.

Working capital: receivables improved sequentially

Receivables were INR 121.12 crore in the quarter, compared with INR 137.41 crore in the previous quarter. This indicates a sequential improvement in collections or billing conversion, even as management highlighted that implementation timelines can influence when revenues are recognised.

Business updates: new client additions and one major loss

Among the positives highlighted, Nucleus Software said it added seven new logos in FY25-26, compared with three in the previous year. It also pointed to strategic investments in AI and other technologies aimed at enhancing product capabilities and supporting client transitions to newer platforms.

The company also expanded its sales and account management team, adding 40 to 50 sales executives, and appointed a Chief Business Officer.

On the negative side, the company disclosed that it lost Bajaj Finance as a client due to Bajaj’s strategic investment in a competitor. It also flagged that migrating clients from older software versions to newer platforms can take significant time due to extensive customisations.

Dividend, guidance stance, and other disclosures

For capital returns, the Board recommended a final dividend of INR 12.50 per equity share for FY25-26, subject to shareholder approval.

Management reiterated that it does not provide specific revenue or earnings guidance. The company also said it continues to monitor developments related to new Labour Codes and will evaluate impacts on employee benefits as needed.

Quick data table: Q4 FY26 scorecard

Order book composition at year-end

Market positioning metrics cited in the release

The dataset accompanying the results also cited a price-to-earnings ratio of 18.2x, stated as below the Indian market level of 23.4x. It also noted that mutual fund holding in Nucleus Software Exports was 1.07% as of March 31, 2026. Another data point stated that 0.00 analysts had given the stock a sell rating.

Analysis: what stands out for investors

Two elements stood out in the FY26 narrative. First, revenue rose year-on-year, but EBITDA and net profit fell, pointing to operating pressure even with modest top-line growth. The delivery cost ratio disclosed for Q4 also remained elevated compared with last year, aligning with the margin compression visible in EBITDA.

Second, the sharp rise in the order book to INR 1,044.31 crore is the strongest forward-looking indicator mentioned. Management’s caution that revenue recognition may lag because of implementation cycles matters for quarterly expectations, especially when client migrations are complex and highly customised.

Conclusion

Nucleus Software ended FY26 with higher consolidated revenue and a much larger order book, but with lower EBITDA and net profit than FY25. Next steps to watch include shareholder approval for the INR 12.50 final dividend and updates on order execution and client migrations, as management continues to avoid formal guidance.