Tanla Platforms Surges 13% on Strong Q3 Revenue Growth

Introduction

Shares of Tanla Platforms Ltd. surged by nearly 13% on Friday, January 23, following the announcement of its third-quarter financial results for fiscal year 2026. The positive market reaction was driven by the company posting its first double-digit revenue growth in six quarters, a significant milestone that has renewed investor confidence. The results, declared after market hours on Thursday, highlighted robust performance across key financial metrics, including revenue, profit, and operating margins, signaling a potential turnaround after a period of subdued performance.

Detailed Q3 Financial Performance

Tanla Platforms reported a consolidated revenue from operations of ₹1,121.03 crore for the quarter ended December 2025. This represents a substantial 12.1% increase compared to the ₹1,000.4 crore recorded in the same period of the previous year. On a sequential basis, revenue grew by 3.9% from ₹1,078.47 crore in the preceding quarter. This performance marks the first time since the first quarter of FY25 that the company has achieved a revenue growth rate exceeding 10%.

Profitability also saw a healthy uptick. The company's net profit after tax (PAT) stood at ₹131.37 crore, an 11% year-on-year increase from ₹118.5 crore. The earnings before interest, tax, depreciation, and amortization (EBITDA) climbed to ₹190.5 crore, marking a 16.6% year-on-year rise.

Margin Expansion and Operational Efficiency

A key highlight of the quarter was the improvement in margins. The EBITDA margin expanded to 17%, up from 16.3% in the year-ago period and 16.5% in the previous quarter. This return to the 17% mark, last seen in the second quarter of FY25, indicates better cost control and enhanced operational efficiency. The company's gross profit for the quarter was ₹309 crore, with gross margins improving to 27.6%. Furthermore, Tanla generated a strong free cash flow of ₹137 crore, which is equivalent to 104% of its profit after tax, underscoring its robust cash-generating capabilities.

Segment-Wise Performance

Both of the company's primary business segments contributed to the positive results. The Enterprise Communications division reported revenue of ₹1,019.4 crore, a year-on-year increase of 12.7%. The Digital Platforms segment also performed well, with its revenue growing by 6.4% year-on-year to ₹101.6 crore. This balanced growth across its core operations demonstrates the company's solid business fundamentals.

Growth Drivers and Customer Metrics

According to the company, the sequential growth was primarily organic and driven by an increased wallet share from its existing customer base. The annual growth, meanwhile, was led by its key platforms, including Wisely.ai and the MaaP platform, along with increased traction in OTT channels. Tanla also demonstrated strong customer retention, with 12 of its top 20 customers from the previous year continuing to be in the top 20. The company added 81 new customers during the quarter, which contributed ₹3.7 crore to the revenue.

Management Commentary

Uday Reddy, the Founder, Chairman, and CEO of Tanla Platforms, described the quarter as a milestone. He stated, "Q3 marks a milestone, with revenue crossing ₹1,100 Cr for the first time and growth delivered across all key financial metrics. Both business segments continue to perform well." He further added that the company will remain focused on investing in its AI-native platform, Wisely.ai, to build innovative solutions for telecom operators and enterprises, signaling a clear direction for future growth initiatives.

Market Reaction and Stock Outlook

The market responded enthusiastically to the results. The stock jumped 12.8% to hit an intra-day high of ₹506 on the BSE. By mid-day, shares were trading 11.3% higher at ₹498.75. This sharp rally is a notable rebound for the stock, which has been under pressure recently. Despite the single-day surge, the stock is still down approximately 9% over the last month and 20% over the last three months. The strong quarterly performance, coupled with improving margins and healthy cash flows, could provide a foundation for a sustained recovery if the business momentum continues.

Conclusion

Tanla Platforms' third-quarter results for FY26 have provided a much-needed boost to investor sentiment, driven by a return to double-digit revenue growth and expanding margins. The strong performance across its business segments, coupled with robust cash generation, highlights the company's operational strength. With a continued focus on innovation through platforms like Wisely.ai, Tanla appears positioned to build on this momentum in the coming quarters.