Tanla Platforms Surges 13% After Double-Digit Growth in Q3

Shares of Tanla Platforms Ltd. experienced a significant rally, jumping nearly 13% on Friday, January 23, 2026. This surge followed the company's announcement of its third-quarter financial results for the fiscal year 2026, which revealed the first instance of double-digit revenue growth in six quarters. The strong performance, reported after market hours on Thursday, boosted investor confidence and marked a potential turnaround for the stock, which had been under pressure in recent months. The results highlighted robust growth across key financial metrics, including revenue, profit, and operating margins, signaling healthy business momentum for the cloud communications provider.

A Detailed Look at Q3 Financial Performance

For the quarter ending December 2025, Tanla Platforms reported a consolidated revenue of ₹1,121.03 crore. This represents a substantial 12.1% increase compared to the ₹1,000.4 crore recorded in the same period of the previous fiscal year. On a sequential basis, revenue grew by 3.9% from ₹1,078.47 crore in the preceding quarter. This return to double-digit year-on-year growth is a significant milestone, being the first such occurrence since the first quarter of the fiscal year 2025.

The company's profitability also saw a healthy improvement. The profit after tax (PAT) for the third quarter stood at ₹131.37 crore, an 11% rise from ₹118.5 crore in the corresponding quarter of the previous year. Sequentially, the net profit increased from ₹125 crore. The earnings before interest, tax, depreciation, and amortisation (EBITDA) climbed to ₹191 crore, marking a 16.6% year-on-year increase. This robust performance underscores the company's operational efficiency and ability to manage costs effectively.

Margin Expansion and Cash Flow Strength

A key highlight of the Q3 results was the expansion in operating margins. The company's EBIT margin expanded to 17% in the December quarter, up from 16.3% in the year-ago period and 16.5% in the previous quarter. This improvement brings the margin back to the 17% level last seen in the second quarter of FY25. Similarly, the gross margin improved to 27.6%, supported by better cost controls and a favorable revenue mix.

Tanla Platforms also demonstrated strong financial health through its cash generation capabilities. The company generated a robust free cash flow of ₹137 crore during the quarter. This figure is equivalent to 104% of its profit after tax, highlighting excellent cash conversion and a strong balance sheet. This financial discipline provides the company with the flexibility to invest in future growth initiatives without relying on external financing.

Growth Catalysts and Business Drivers

According to the company, the sequential growth was primarily organic and driven by an increased wallet share from its existing customer base. This indicates strong customer relationships and satisfaction with Tanla's services. The annual growth, on the other hand, was led by strategic platforms such as Wisely.ai and the MaaP platform, along with increased adoption of OTT channels.

The company's ability to retain key clients remains a significant strength. Tanla reported that 12 of its top 20 customers from the previous year continue to be in its top 20 list, with the remaining eight now positioned within the top 30. Furthermore, the company is successfully expanding its client base, with newly acquired customers contributing ₹3.7 crore to the revenue in the third quarter.

Management's Perspective on the Milestone Quarter

Uday Reddy, the Founder, Chairman, and CEO of Tanla Platforms, described the third quarter as a milestone achievement. He highlighted that it was the first time the company's revenue had crossed the ₹1,100 crore mark. Reddy expressed satisfaction with the performance across all key financial metrics and noted that both primary business segments are performing well. Looking ahead, he affirmed the company's commitment to continue investing in its AI-powered platform, Wisely.ai, to develop innovative solutions for telecom operators and enterprise clients.

Market Reaction and Stock's Trajectory

The strong quarterly report was well-received by the market. On January 23, Tanla Platforms' shares surged, trading 11.3% higher at ₹498.75 and reaching an intraday high of ₹508.00. This rally provided a much-needed boost to the stock, which has faced downward pressure in recent times. Despite the single-day gain, the stock remains down by approximately 9% over the last month and has seen a decline of about 25% over the past three years. The positive results could serve as a catalyst for a potential re-rating if the company sustains its growth momentum.

Conclusion: A Positive Outlook Ahead

Tanla Platforms' third-quarter results for FY26 mark a significant positive turn, driven by a return to double-digit growth and improved profitability. The strong performance, fueled by organic growth and strategic platforms like Wisely.ai, suggests that the company's strategy is yielding positive results. While the stock has faced headwinds in the medium term, this strong financial report, coupled with healthy cash flows and stable customer relationships, provides a solid foundation for future growth. The management's focus on continued investment in AI-native solutions positions Tanla to capitalize on emerging opportunities in the cloud communications space.