Subex Q4 FY26: EBITDA margin 14.5%, PAT improves

What Subex reported in Q4 FY26

Subex ended Q4 FY26 with steady revenue growth but a sharper improvement in profitability and cash position. The Bengaluru-based telecom AI and digital trust solutions company said it is tightening execution, doubling down on telecom use cases, and scaling AI where it already has customer trust. Revenue rose 3% sequentially to INR 72.96 crore in Q4 FY26 from INR 70.79 crore in Q3 FY26. Management positioned the year as a reset, arguing that the underlying performance looks “cleaner than the headline” due to the exit from non-core businesses in the prior year.

The company announced its Q4 FY26 results on 12 May 2026 and held an investor and analyst call on 13 May 2026. CEO Nisha Dutt said the company exited the year with a stronger balance sheet, improved profitability, sharper market positioning, and a more aligned foundation for long-term AI-led growth. She also said order intake grew 24%, Subex released new products, and it “included more AI deals than any other prior year.”

Key quarterly financial performance

Profit conversion improved sequentially, with EBITDA and normalised profits moving up from Q3 FY26 levels. EBITDA for Q4 FY26 stood at INR 10.58 crore versus INR 9.10 crore in Q3 FY26. Normalised PAT rose to INR 11.51 crore from INR 7.68 crore in the previous quarter. Reported PAT, which the company said includes exceptional items and impairment allowance, came in at INR 9.93 crore compared with INR 2.93 crore in Q3 FY26.

Subex also disclosed that it reported a loss of INR 17.60 crore in Q4 FY25, underlining the year-on-year improvement in reported profitability. Management highlighted that EBITDA has been positive in 9 of the last 10 quarters and that the company has delivered three successive quarters of positive PAT.

Margin expansion and what drove it

The company reported a normalised EBITDA margin of 14.5% in Q4 FY26, compared with 7.5% in Q4 FY25. Management attributed the improvement primarily to operational efficiencies. Alongside margins, normalised profit before tax improved to INR 14.38 crore in Q4 FY26 from INR 10.51 crore in Q3 FY26.

During the earnings call, management framed profitability consistency as the outcome of multi-year operational discipline. The CEO also said the focus for FY27 would be growth, acknowledging that the company is “growing but not at the rate” it would like. Management also said full-year total income was up 6% year on year, and that it was broadly supported by interest income.

Liquidity improves; tax refund disclosed

Cash and cash equivalents increased to INR 175.26 crore as of 31 March 2026, up from INR 154.12 crore as of 31 December 2025. Subex also received a tax refund of INR 4.17 crore in Q4 FY26. Separately, management said liquidity strengthened by INR 70 crore over the year, describing it as a change that allows the company to invest from a position of strength rather than manage defensively.

Revenue mix and geographic footprint

Subex’s Q4 FY26 revenue mix remained spread across managed services, licenses and implementations, and support and others. The company also continued to lean on EMEA as its largest geography, while APAC and ROW saw a sequential rise.

The company also stated that about 70% of revenue is annuity or recurring in nature, and customer retention is around 95%. Management said around 50% of revenue comes from top-tier customers.

Order intake, backlog, and deal wins

Management repeatedly highlighted order intake momentum, stating order intake grew 24% and that last year’s order intake was 35% higher than any other year. In the Q&A, an analyst referenced orders of more than INR 150 crore over the last year and asked about conversion into revenue. Management responded that Subex is entering the year with a strong backlog and a strong pipeline, adding that the way contracts ramp means wins may contribute across more than one year.

Subex also outlined several deal wins and renewals. These included a new Enterprise Asset Management deal with a leading operator in North Africa, a new AI handset fraud deal in North America on FraudZap, and regaining a business assurance account in the Middle East from a tier-1 competitor. The company also cited an upgrade deal for BAFM with a five-year AMC with a tier-1 operator, along with additional renewals and fraud upgrades across Africa and APAC.

AI-led strategy stays telecom-first

Subex described AI as a primary lens for growth rather than a side capability, noting that almost all RFPs now ask for AI use cases. Management positioned fraud management as a top AI and GenAI use case among telecom operators, aligning with the company’s focus on telecom-centric platforms such as FraudZap.

The company’s messaging also ruled out broad-based expansion across industries. Instead, Subex is prioritising execution in telecom, where it already has installed relationships and recurring revenue structures.

Market impact and why the quarter matters

For investors tracking Subex, Q4 FY26 underscored a split narrative: revenue growth remained modest quarter-on-quarter, but margin and profit conversion strengthened. The rise in cash and the disclosure of a tax refund add to the near-term balance sheet picture, while management’s emphasis on backlog and pipeline conversion points to execution as the key monitorable.

The improvement in normalised EBITDA margin to 14.5% is material in the context of the company’s own year-ago margin of 7.5%. Management’s comments also suggest FY27 priorities will be centred on accelerating top-line growth while sustaining the operating discipline that supported profit improvement.

Conclusion

Subex’s Q4 FY26 results showed stable revenue and a sharper rise in profitability, supported by operational efficiencies and improved liquidity. Management reiterated that the company is entering the next year with a strong backlog and pipeline, and that growth is the primary focus going forward. With AI increasingly embedded in telecom RFPs and Subex positioning products like FraudZap at the centre of its strategy, updates on deal conversion and revenue ramp will remain central to how the market tracks FY27 execution.