Nazara Technologies Limited ($NAZARA)

Ladies and gentlemen, good day, and welcome to the Q4 FY '26 Earnings Conference Call of Nazara Technologies Limited, hosted by AMBIT Capital. [Operator Instructions]. Please note that this conference is being recorded. I now hand the conference over to Mr. Vivekanand from AMBIT Capital. Thank you, and over to you, sir.

Thank you, Swapnali. Good morning, everyone. A very warm welcome to all of you on behalf of AMBIT Capital. We are proud to host the 4Q FY '26 and FY '26 Post Results Conference Call of Nazara Technologies Limited. I would like to take this opportunity and welcome the senior management team of the company joining us on the call today. Connected on this call are participants from Nazara, including Mr. Nitish Mittersain, Joint MD and CEO, Nazara Technologies Limited; Mr. Rohit Sharma, Executive Director; Mr. Rakesh Shah, CFO; Ms. Anupriya Sinha Das, Head of Corporate Development, Nazara Technologies; Mr. Shreyes Menon, Head, Offline Gaming; Mr. Terry Lee, CEO, Fusebox Games; Mr. Stuart Dinsey, CEO, Curve Games; Mr. Raymond Stauffer, CEO and Founder, Bluetile Games; Mr. Manish Gaurav, Head of Business Kiddopia; Mr. Jeff Amis, Co-Founder and CEO, WildWorks; Mr. Mayank Kumar, Director, Operations, Absolute Sports Private Limited; Mr. Rathee, Founder, NODWIN Gaming Private Limited; Mr. Senthil Govindan, CEO, Datawrkz Business Solutions Private Limited; and Mr. Chris Jones, CEO, Space & Tile. I would like to now call upon Mr. Nitish for his opening comments. Thank you.

Hi. Good morning, everyone, and thank you for joining us this morning. FY '26 was a pivotal year for Nazara. Revenue reached INR 1,829 crores and EBITDA grew 66% to INR 255 crores, our highest ever with Q4 EBITDA margins reaching 19.5%, almost doubling on a year-on-year basis. Importantly, cash generation also strengthened significantly with pretax operating cash flow growing 81% year-on-year to INR 213 crores. More importantly, the shape of Nazara has fundamentally changed in FY '26. Gaming contribution to EBITDA increased from 56% in FY '25 to 90% in FY '26 as we sharpened our focus on building a high-margin globally diversified gaming platform across mobile, PC and console and offline gaming. FY '26 also included our largest acquisition to date of Bluetile and BestPlay, which significantly expands our casual gaming scale while adding AI native development capabilities and has rewarded engagement network to our platform. At the same time, our existing gaming businesses and IPs continue to strengthen. Kiddopia has returned to subscriber growth. We saw growth in Q3 and now again in Q4 and Animal Jam has expanded its margins. Fusebox has scaled its narrative engines across multiple IPs such as Big Brother, Big Boss, The Traitors and our PC and Consol game Human Fall Flat crossed 58 million lifetime units globally. The operating system behind all of this is a center of excellence playbook, which we have actively strengthened over the last 12 to 18 months across user acquisition, data analytics, artificial intelligence, growth and product. Every gaming IP we own and increasingly -- every IP we acquire plus into the same system. Going into FY '27, Nazara is at a materially different scale than it was 12 months ago. The quality and earnings capacity of the platform have also expanded significantly, and we will continue to accelerate growth both in revenues and EBITDA in FY '27. I do believe our operating leverage is real, and it is now starting to compound. With that, I will hand over to Anupriya to discuss segmental performance before we enter a Q&A session. Thank you very much, and over to you, Anupriya.

Thank you, Nitish. Good morning, everyone. At the consolidated level, as Nitish mentioned, Nazara delivered FY '26 revenue of INR 1,829 crores, up 13% year-on-year and EBITDA of INR 255 crores, up 66% year-on-year with our EBITDA margin expanding to 13.9%. In Q4 FY '26, the company reported revenue of INR 398 crores and EBITDA of INR 78 crores with EBITDA margin reaching 19.5%. Within this, our gaming business delivered particularly strong growth and profitability with FY '26 revenue growing 107% year-on-year to INR 1,072 crores and EBITDA growing 157% to INR 265 crores, resulting in an EBITDA margin of 24.7%. In Q4 FY '26, gaming revenue grew 78% year-on-year to INR 278 crores, while EBITDA grew 127% to INR 76 crores. Within mobile gaming, revenue grew 38% year-on-year to INR 713 crores with EBITDA growing 33% to INR 137 crores. Performance was driven by stronger execution across live ops user acquisition and data analytics through our COE-led operating model. Kiddopia had returned to subscriber growth in the previous quarter and has sustained that journey with improving unit economics, while Animal Jam delivered meaningful margin expansion during the year. Our narrative games also continue to grow with multiple reality TV IPs getting launched in FY '26 with additional launches planned in FY '27. During the quarter, we also completed the acquisition of Bluetile and BestPlay, which has significantly expanded our casual gaming scale and AI native capabilities. This business will be consolidated from FY '27 onwards, pending some regulatory approval. PC and Console publishing business continued to deliver strong profitability with FY '26 revenue of INR 261 crores and EBITDA of INR 101 crores at 39% EBITDA margin. Human Fall Flat crossed 58 million lifetime units globally while our broader publishing portfolio continued to demonstrate durable monetization and growing platform reach. Our offline gaming businesses with Smaaash and Funky Monkeys also delivered profitability during FY '26 with revenues of INR 99 crores and EBITDA of INR 27 crores. We continue expanding the Funky Monkeys footprint during the year and progressing towards the launch of the reimagined Smaaash 2.0 format. Within our other businesses, adtech delivered strong growth and profitability with both revenue and EBITDA growing 32% year-on-year. Sportskeeda remained profitable despite a softer traffic environment following Google Core updates, supported by continued cost discipline and improving performance across new properties. NODWIN, our associate company, also delivered a significant EBITDA turnaround during FY '26, moving from a loss of INR 14 crores in FY '25 to a profit of INR 21 crores in FY '26, while continuing to scale its youth media and live events platform globally. With this, I conclude my remarks, and we'll now open the call for Q&A.

[Operator Instructions]. We have the first question from the line of Jinesh Joshi from PL Capital.

Congratulations on the margin performance. I have 2 bookkeeping questions to begin with. First is on the other income bets, which was at about INR 51 crores in this quarter and apparently, it appears to be materially higher. Was there any one-off in this quarter? I mean I just thought of checking because there is no disclosure in the footnote. That is one. Secondly, if I look at our share of losses from associates, I think in this quarter, that figure was INR 31 crores. I believe after the deconsolidation of NODWIN, we will own about 46% to 47% stake in the company. Is it impact the overall losses for NODWIN the quarter were at about INR 65 crores, INR 66 crores. I just wanted to cross verify this thing because NODWIN reported an EBITDA of INR 4 crores in this quarter, which implies that the amortization figure is very high in the business. If you can just clarify on these 2 things.

This is Nitesh. Let me take both these questions. The other income predominantly driven by one is, gain of INR 31 crores on our investment in Rusk Media. The holding that we had in Rusk Media was revised upwards, which is a new round of investment that they have raised. That contributed INR 31 crores and the balance was a mix of things, including some currency gains, etc., on restatement of loans to Nazara U.K. That largely forms the other income, including some mutual fund gains, etc. In terms of the NODWIN question on the losses from associates, these are contributed by one, some losses from Moonshine, which is continuing to find a way to recover some of its business in a compliant manner. Largely, it came from NODWIN, which wrote off some goodwill it was carrying of INR 50 crores relating to an acquisition of OML assets done 3, 4 years back, predominantly coming from NH7 Weekender, which has not delivered the cash flows that were projected at the time the goodwill was established. NODWIN took a conservative view and wrote it off, although NH7 Weekender as an IP is bouncing back pretty well. I think that's largely what is driving. At an operational level, NODWIN has been EBITDA profitable this year and also in this quarter.

INR 50 crores is the number that you mentioned, right?

Yes.

The goodwill, right. Secondly, on the PC and console gaming, I mean, in the presentation, we have mentioned that we'll launch new IPs like Dragon Shelter, [indiscernible] etc. If you can just give what is the time line for the launch? Also if I compare the full-year revenue of INR 261 crores with the previous year, there's hardly any growth. What are the plans to boost the organic traffic over here? If you can share some thoughts on that?

What I will do is I will call Stuart, who is the CEO of Curve, who is dialing in from London. also ask Rohit Sharma, he -- who's driving a lot of our PC and console business to also have add-on comments. Stuart, you can go in first and just give a little overview of your upcoming titles, timing. Then Rohit, you can have your comments.

Yes. Thank you, Nitish. Yes, in answer to that question, since acquisition, there has been a period of transition. We've completed that in a way that hasn't distracted the business. We're very happy with that. We have begun investing in new games to deliver long-term growth. We expect to launch at least 6 new releases in this current year, maybe a couple more. The games that you mentioned, they will start -- WCC4 actually released last week and other releases in the summer will include Sovereign Tower and Dragon Shelter. We believe that the release of these games will bring long-term growth for the company. We will continue to look at retaining a high margin from our low-cost base where we can whilst increasing our development spend to build that pipeline.

This is Rohit here. Just to add to your second question, previously, before Nazara acquired Curved Games under the previous parent, Curve games was not -- for the last 2 years has not been signing a lot of games. Therefore, you see that kind of growth, but the good part is that the -- our existing IPs like Human Fall Flat and Wobbly Life have still given us the growth this year. As mentioned, now we have already gone on a very fast speed of signing new titles, which should be launching in this financial year and subsequent financial years, and that's where we will see the growth as we go on.

One last question on Sportskeeda. I think the revenue declined by about 38% in FY '26, while the EBITDA margin has also come off quite a bit to about 12%. I understand this has been because of the Google core issue that you have highlighted in the past calls, but I believe it has been 4 quarters since you are trying to get over this problem with limited success. Just wanted to understand, is it really possible to mitigate this challenge? Or should we build in a materially lower EBITDA margin of about 12% to 15% in this business going ahead? How to think of growth from here on? Yes, that is my last question.

Jinesh, unfortunately, I couldn't hear it clearly. Can you quickly repeat it?

The problem is, Sportskeeda, I think the revenue decline and the margin problem that we have been solving that.

Sure. I think we've not seen the kind of recovery we want to see over there. We continue to do many things to try and achieve that. Although some of our existing other IP outside of Sportskeeda, like Pro Football Network and Prime Time are showing very good positive signs and good numbers. I think at this point of time, we continue to optimize costs. We continue to do that. We actually expect margins to increase in FY '27 on potentially a smaller base. I can also have Mayank come in here. Mayank is leading Sportskeeda and share his thoughts.

Like Nitesh said, the focus on this year was more to drive or retain the EBITDA than growing revenue or recovering the revenue loss that we have seen in the last year. That focus will continue going into the next year as well as we plan to mitigate our expenses and then also accordingly increase our EBITDA in the next year.

[Operator Instructions]. We will take the next question from the line of Vivekanand from AMBIT Capital.

Nitish, how do you rate your preparedness as an organization, including your center of excellence to now serve multiple gaming growth engines across segments, including publishing and, of course, new technologies. Of course, these are all in addition to the existing ones that you have, like Lava Island, Kiddopia, etc. That is my first question. The second question is on NODWIN. Could you discuss the IPO time lines there? What is the plan you have for NODWIN? Will NODWIN be raising cash? Will you also be looking to monetize some of your shareholding? I'll stop with these and then ask follow-ups where needed.

Yes. I think for your first question, the centers of excellence that we've invested in and built over the last 18 months and accelerated in FY '26, I think are really becoming center stage to support the expanding portfolio of IT teams and technologies. Most of these centers of excellence are led by very senior people with a lot of in-depth experience at scale, I would say. I think we are feeling very confident that we've put in these efforts over the last 12 to 18 months, and they will actually start showing clear results in FY '27. I would say Kiddopia's one good example of being benefited from these initiatives, which we've seen in Q3 and Q4. This will play out more actively across the portfolio in FY '27. AI, of course, is a very big theme for us, not a narrative, but a very important aspect of what we are doing today. Across the studios that we operate, across the different functions of gaming, whether it's the development process, how we do user acquisition, how we analyze data, how we engage with the user, right? We're seeing a lot of uptake. We're also very excited about Bluetile's AI capabilities. Maybe I can get Raymond just to interject 2 minutes how Bluetile is leveraging AI because some of that we hope to adopt in FY '27 in many of our other studios. Raymond, do you just want to give a quick update on that?

Sure. In our case and especially after the ongoing integration, we're able to really scale our operations due to applying AI to each individual department that we have across all the different functions and processes. From marketing, creative marketing to marketing operations, product development, technical development, ad monetization, data segmentation. We're starting to apply AI in different capacities, both through LLMs, but also through different complex algorithms such as reinforcement learning and other types of AI. As Nitish mentioned, a lot of these capabilities are also being developed and leveraged from the centers of excellence. The interaction between them and our specific team has been really fruitful. we've seen the capacity the team has now with these tools increase exponentially.

Yes. Just moving on to the second question. I think from a Nazara perspective, we will look at potentially monetizing noncore businesses for us. This could be NODWIN, it could be Sportskeeda, it could be the adtech business in due course. We are not in any hurry, but we definitely see the potential to unlock value and redeploy in our core gaming business. We will continue to evaluate opportunities as and when they come or get created. With specific NODWIN IPO-related questions, Akshat can come in and give an update. Akshat, over to you.

Thank you so much for the time. I appreciate the question. Look, NODWIN has been doing extremely well as a listed company under Nazara for the last 5 years of our life, right? Ever since Nazara acquired us, we've been in training. I think there is no better gift that a parent company can go ahead and give to a company like ours to go ahead and take us through everything from compliance to regulatory to go ahead and having the discipline to go ahead and have a closing our books every quarter and then going with guidances that we can go ahead and live up. NODWIN itself has had a very good year despite the fees hiccup that we had, we've been able to go and do many more integrations and natural growth been sitting at between 25% and 35% of the core business itself. The positioning as a live youth media company because gaming remains at the core heart of what we do has allowed us to have very meaningful conversations and NODWIN is looking both to raise funds between $100 million to $200 million independently and this will be a mixture of primary and secondaries and then also prepare for an IPO as soon as possible. I say as soon as possible is let's do it right. I don't think we get multiple chances to go ahead and do this. With the conversations I had with all of you in the analyst community and obviously, our bankers, we've had very good outcomes to some of our conversations. We remain in line to go ahead and go public independently with the blessing of Nazara as soon as the timing and the business is right.

Nitish, on Bluetile specifically, I have a follow-up. Just to understand the segment that it is operating in. You mentioned it's casual, social mobile games. My understanding is that this business is designed mostly for global audiences, right? if you can help us understand the TAM that this business operates in and the scalability that, say, some of the peers of Bluetile globally have achieved, I think that will help investors understand how to think about Bluetile, let's say, 3 years?

I think Raymond is best suited to answer that. Raymond, over to you.

Sure. We're operating in several gaming verticals, but predominantly in the casual space, concretely in the casual evergreen space, which are traditional games that everybody knows. They have a very large global exposure such as Solitaire, Word Search, Word Puzzles, other kinds of board games and other puzzle games. That will be the casual evergreen category. In that category, we can see other competitors such as Tripledot, which has been valued at over $1 billion. We also have Easybrain, which was acquired by Miniclip from the Embracer Group by $1 billion. There's quite a few competitors with quite a large volume. The other space that we are actively developing games is the hybrid casual vertical. These games are essentially a mix between the traditional hyper-casual games that are being casualized per se. Essentially introducing long-term mechanics, social mechanics and allowing users to play these games for a very long time, increasing long cohort retention. These games will have other competitors such as a recent competitor has just sold to Scopely a stake in their company, a company called Loom Games from Turkey for over $500 million. Essentially, the market is extremely big and very profitable, and it expands into pretty much any geography in the world.

I have one follow-up for Akshat. Akshat, thank you for your comments on how you're thinking about the fundraising. Now as far as NODWIN goes, again, like we see the rest of Nazara pivoting more to global markets given the monetization constraints in India. Is that also something that you are now mulling? What will you ideally use the funds for in terms of expanding either through new events? Or is it going to be mostly international?

It's a very deep question, and thank you again for this. You literally had asked me the 2 growth levers of NODWIN. NODWIN is complex, but it's a very simple. We have 2 lines of our business. We consider them the live part of the business and the content part of the business. The content part of the business, think of it very grassroot. It allows people to discover their entertainment passions, young people to go ahead and discover their entertainment passions. Across the world, their entertainment passions are multitude. They can be games, they can be music, they can be pop culture, cost play, they can be space festivals. It's okay. We don't judge. It can be reality television that we do with Rusk, with Playground, with our IPs. That's fine. That's how -- all our influencer lineups, right? That's the content play. In the age of AI, we believe this will go ahead and increase both in volume and value in this would be organic growth of between 5% and 10% because monetization still will catch up over a long time. This is the discovery engine for NODWIN. It's profitable and will subsume both live and IPs. On the other side, we have the live business. The live business is a manifestation of super fandom for the things that people love. If you love an influencer, this is where you come and meet the influencer at a YouTube fan fest or a [conclave] kind of an event. This is the place where you go ahead and come for a music festival. This is the place where you come for an esports tournament, where you go ahead and meet the biggest players in the world and in the country to go ahead and do this. We believe both of them just goes against each other. One that the discovery and the other goes and gives you the super fandom. Super fandom obviously, is much more profitable as such. Again, subsumes both white label and IPs. The second part of the question is the growth part. NODWIN runs on 3 vectors. NODWIN's core vector, the first vector that NODWIN was going and doing an expansion is something called the Global South. It's a geographical play where we believe we are the huge media company for the world. For the world, we want to be focusing specifically on the global south. The global south being everything from Philippines to Mexico, to a line of -- which is the topic of Capricorn and all those countries that are really large in size and material would be part of the play where we want to be. I think we are nearly there in completing the global belt around the South. We have empty spaces right now in Southeast Asia and in Latin America, and those are the ones we keep on exploring on. The other question on where do we do with this? We also have the XYZ, the X is geography. Y is IP, and Z is the ways to monetize for people. We look at everything from merchandising being one way to monetize, but also new payment methods that might be very relevant in another country. We build and acquire around youth media touch points and engagement across geographies, across IPs and across payment -- across monetization methods. That's our investment thesis for expansion. We believe we will always be an India company first because India remains one of the most robust places where not only the core engine runs. On the contrary, for us through [Proga], the law and the live entertainment exploding in India, I think India is going to remain one of our anchor 50% core market.

[Operator Instructions]. We have the next question from the line of from Atul Borse from JMFL.

I have 2, 3 questions. First on how do you think overall the Nazara's growth or margin profile will like in FY '27 post the Bluetile consolidation? You also mentioned that you plan to divest the noncore gaming segment. Do you have any time line in mind by when you want to divest the sports of adtech? The last question is on adtech bet, that there was a sequential decline in adtech. Any reason for that growth slowdown? How does the seasonality work for this segment? Those are my questions.

Let me take the first one, which is growth in FY '27. I think Nagara's existing businesses, we expect to drive organic growth and expansion of margins due to 2 things. One is the output or outcome of the centers of excellence activity that we've been doing in FY '26. Second is stronger, faster implementation of AI and how that plays out for us. While I don't have specific guidelines, I think these 2 make us feel very positive that we will be able to deliver both organic growth and margin expansion from this point onwards as well. If you look at Bluetile, their CY '25 numbers, calendar year '25 numbers was around INR 1,450 crores revenue and INR 254 crores of EBITDA. Similarly, the EBITDA profile for CY '25 for Bluetile was similar to what Nazara is reporting for FY '26. On a pro forma basis, if you combine these 2, then obviously, our EBITDA actually should double and then you can add organic growth for both businesses on top of it. We don't have a specific guidance at this point of time, but very bullish on overall very strong performance on financials in FY '27. In terms of divestment of noncore, like I said, we will continue to evaluate opportunities. We are not in a rush, but we do see the opportunity to extract value and monetize and redeploy in core gaming, which kind of is much more synergistic with our core business and now our stated goal also will help us drive higher margins going forward. I would imagine that we will try and have some actions happen in FY '27 and FY '28 to achieve this goal. On the adtech side, I would like Senthil and Chris to give -- maybe Rohit can set the context and then Senthil and Chris can chime in on what's happening on the adtech business. Rohit, to you.

Thanks, Nitish. Yes, I think on your question on adtech, I think Senthil and Chris can add more. We have consciously -- and that's why there's a bit of a decline. We have consciously taken a call to focus on our tech-driven DST business, which is visible, where we see more growth coming. Some of the traditional adtech businesses, which are anyways declining globally, we are kind of reducing our focus from there, which were earlier contributing to some numbers for us. In fact, even Senthil has now moved to U.K. and U.S. are our key markets, product for adtech is our key focus area. I think that is why because of the shift of focus and not going behind scalable revenues is where we have seen some bit of a decline. Senthil, over to you if you want to add on to this.

Yes. Thanks, Rohit. Just to continue from where Rohit left off, so as Rohit was saying, we are focusing a lot more on our product-driven part of the business. We had relaunched our DSP visible about 2.5 years ago, and we are seeing a really high growth in that area. What we are doing is reinvesting in that both from a sales and marketing standpoint. As Rohit mentioned, I myself have moved to the U.K. so that I can more closely oversee our growth in Europe and the U.S. We are also rolling out additional products, which are, again, through the acquisition that Datawrkz in turn had made of Space & Time in the U.K. There are requirements that their clients have that they have for their client set, which we are now leveraging our product unit based out of Bangalore in order to build additional technology for that clients. Through that, the expectation is that we'll also be able to expand these products to the broader market, right? All told, there is a temporary decline, but what we are seeing is that the pivot to a high-margin-led, product-led growth business is clearly underway, and that shows a lot of positive signs for FY '27.

Chris, do you just want to add to that on Space & Time, since it contributes a large amount to the revenues of adtech? We have Chris on?

Yes. Hello everyone. Yes, I would echo some of the points that were made by and Rohit there. I think from a Space & Time specific point of view, looking at Q4 specifically, we saw a decline in overall revenue, but this was anticipated earlier in the year. In the full-year picture, we finished slightly ahead of where we were expecting to be in the AOP, and we expected this reduction in the final quarter for a number of reasons. The main impact on it is really to do with the market conditions we face in the U.K. We operate in a number of verticals. One of the core verticals we operate in is the new homes market. That's facing some very well-publicized challenges at the moment, and that's just having a knock-on effect in terms of their discretionary marketing spend. Fortunately, the business has a strategy to diversify our income into more product-led and tech-driven services, which is meaning that impact isn't felt to the same degree of gross margin. In fact, obviously, in the full-year position, we outperformed EBITDA quite significantly. Our view on that variance is one of -- we're not overly concerned because the business is well positioned to capitalize on the changes that are going on in the market and also the fact that the nature of what we do is becoming more focused on capturing gross margin and sort of profitability from the revenue as opposed to the revenue itself. It's kind of following a kind of very natural trend that's in the industry at the moment as ownership of advertising platforms move in-house. We're not overly worried by the trend and actually the full-year position for the agency was very, very positive, and we're optimistic and bullish about the following FY '27 as well.

Just one follow-up that -- so you think that this 4Q decline is temporary in nature, right? It will bounce back to the normalized levels going ahead?

Rohit, you want to answer that.

Yes. I think as both Chris and Senthil have mentioned that in case of Space & Time, there is a seasonality that is happening and the market is facing a bit of a challenge. I think, again, Space & Time has built very strong tech and data and AI capability, which is mitigating that for them. Similarly on Datawrkz side, as Senthil mentioned, we are shifting our complete focus to product-driven, tech-driven businesses, especially in the Western market. To answer your question, yes, I think as we go on, we'll be able to see growth.

[Operator Instructions]. We will take the next question from the line of Vivekanand from AMBIT Capital.

Nitish, on the portfolio that you have, I appreciate the job you've done in simplifying it and focusing the company on gaming, while identifying appropriate noncore businesses and divestment plans. Just to double-click a bit more on this, we have seen that under the leadership of the founder of NODWIN, Akshat leadership and of course, looking at Nazara's own support that would have gone in scaling up the business, we've seen this business scale up to maybe $70 million in revenue, quite sizable, right? When I look at Nazara today, it seems like the portfolio has many assets, individually small, collectively meaningful. That's how I look at it. Just to understand better the success that you had with NODWIN in terms of scalability and now profitability as well, how should one think about your overall portfolio, let's say, if one is taking a 3- to 5-year view, today, what could be the 1 thing or 2 things that can be very big in size and also can gather investor interest in their own lives, just like NODWIN?

Yes. No, I get your question. I think our focus, one, has always been to build growing businesses or grow businesses profitably. While NODWIN is one example that you spoke of, if you see our history over the last few years as we have invested in acquired companies, Kiddopia was acquired with a INR 15 crore revenue run rate in 2, 3 years, we took it to INR 200 crores-plus. When we acquired Sportskeeda, it was a INR 15 crores revenue company, which delivered INR 80 crores of EBITDA last year before taking a hit, in FY '25 before taking a hit in FY '26. I think our focus has always been that how do we acquire businesses where we can add value or grow the business after acquiring it. Another example is Fusebox Games in the U.K., which is a story-based games on popular TV shows. They were doing very successfully one game, Love Island after acquisition. We work closely with the team to expand that to now 4 titles, and we will look at scaling it. The second thought has always been is to have a diversified profitable cash flow generating business because we've often seen that gaming businesses can get disrupted or become wonders, whereas our intent always was to, one, build a very resilient business. Second, have multiple IPs that can be leveraged across platforms as these platforms and technologies change. I think we've very successfully established that. I think the third aspect that you said is a portfolio of small studios or smaller games, which have combined to become meaningful. I think it's a journey, right? For us, we've slowly over the years, built our M&A capabilities. In the last 18 months, we built our synergies, centers of excellence that are going to drive synergies. I think those -- the platform -- the value add by the platform is only going to increase going forward and is giving us confidence to take larger steps. If you see the most recent acquisition, which is Bluetile that in itself is as large as our combined business. I think going forward, you will also see a step change in terms of how we look to scale up the overall Nazara business and platform through potentially larger acquisitions as well as focus on larger margin expansion. We see multiple tailwinds on the margin expansion side. A couple of them on the top of my head. One, of course, is AI and how we are leveraging AI to deliver more content to our existing user bases while maintaining the same cost, right? I think that is definitely a large margin expansion. The second is today, the platform like Google, etc., take 30% of the subscription or IP fees. Over a period of time, that is also coming down. I think that will help lead to margin expansion. I think you should look at Nazara as a platform that will continue to grow profitably, generate cash. The resilience is actually an underrated asset for us, where we can really, whenever there's disruption in the market, grow faster. I hope that answers some of your question.

No, I think, Nitish, that's a very, very good point that you made that don't just look at it from the perspective of, say, a very big asset that you create, rather focus on some of the other levers, the portfolio diversification and also the ability of the COEs to leverage on technologies, like AI and also drive towards greater profitability. I think that's great.

We will take the next question from the line of Pranav Mashruwala from Dolat Capital.

Yes. Just a few bookkeeping questions from my side. The depreciation and amortization expense in Q4 was down by about 24%. Which were some of the sub-verticals that had witnessed this decline Q-on-Q?

Our total depreciation in this quarter was INR 45.5 crores. Anupriya, you want to take this?

Yes. The total depreciation was around INR 45 crores and a large part of it is coming from Curve Games, which continues to build games across years -- which have life of multiple years. The deconsolidation of NODWIN has also led to the sequential decline in the overall depreciation number that we report because the depreciation from the NODWIN business is not getting consolidated in the books and coming more EBITDA. That is the reason why you've seen a sequential decline.

Second, on the Bluetile, as we have mentioned that we have completed the acquisition. Some color on the consolidation time line given some approx would be great.

Yes. The acquisition will actually close. We are still pending the Spanish FDI approval, which is in process, and we expect to close the transaction of the acquisition as soon as that comes in. At this point of time, we're expecting it to come in, in the next few weeks, I think 3, 4 weeks, and that's when the actual closing will happen. We expect to consolidate from Q1 of FY '27.

A few questions on the business, if I may. One-off in Fusebox in Q3, we have seen almost a 49% Q-on-Q decline due to seasonality and it bounced back well in Q4. My question is, can some of the newer Ips, like Big Brother, Traitors, which is poised to launch in FY '27 meaningfully smoothen the quarterly volatility.

Yes. I think there will always be some seasonality in these businesses, but I think we are very excited with what we are doing on those IPs. Why don't we get Terry, the CEO of Fusebox to give us an update.

Yes, I think as Nitish mentioned, there's always going to be some seasonality. I think in regards to the other IPs that we have, Big Brother, Big Boss, Traitors offsetting some of that seasonality, it will take potentially a couple of years for them to meaningfully take a chunk out of the seasonality.

Terry, do you want to give an update on where these new launches are on the Big Brother, Traitors?

Sir, Mr. Terry is not connected.

Anupriya, you want to update?

Yes, sure. One is on the question of seasonality. We have a seasonality in the business because whenever there is a new TV show of the original Love Island IP, there is a good influx of installs organically, etc. As Nitesh mentioned, we launched 2 new games, Big Brother and Big Boss in the last year. We have a very extensive release road map in the coming year. We are already live with another fresh seasons of Love Island and Big Brothers, and we are looking to expand the Big Brother season from 1 season in the last 1 year to 3 seasons in this fiscal year, as well as we are looking to launch Traitors in the current fiscal year as well. Plus 4 seasons of -- sorry, 3 seasons of Love Island in FY '27 will have a very well-rounded season calendar, which will see some amount of evening out of the earnings, but there will be seasonality, as Jerry mentioned.

Just a second one on Curve Games. Curve Games had about 39% EBITDA margin in FY '26. As we scale with some of the larger launches on switch to console, can margins sustain about 30%, 35%?

Yes, I do think they will sustain, especially as we are launching new IPs across many platforms. I can let Stuart dive a bit more deeper in it.

Thanks, Nitish. Yes, our margin target is always 50% on any game that we sign. Ultimately, we're a publisher, so royalties payable to the developers can vary depending on the agreement and the risk. As we invest in new games, depending on the size of the investment, we would expect our margin to certainly be maintained on where we've been currently, which is actually comparatively high compared to the market.

[Operator Instructions]. As there are no further questions from the participant. I now hand the conference back to the management for closing comments. Thank you, and over to you, sir.

Maybe what we'll do is we'll just take 2 minutes each on talking a bit about Kiddopia and Animal Jam because both the CEOs are online and they haven't had a chance to speak. Maybe, Manish, if you can give a quick 2 minutes on what's happening on Kiddopia, that will be great.

We definitely see recovery in Kiddopia, and we feel very confident about it being sustainable. It's driven by largely 3, 4 growth levers. One is the center of excellence has made our or much stronger and cleaner and that is giving us the growth that we needed in this particular business. The second is the IP strategy. We integrated 4 IPs in the last 12 months, and that has seen a significant improvement in the overall funnel, and that's really helped. There has been a lot of focus in improving our data visibility across the org and that has made our decision-making and the overall -- we are much more informed and faster in decision-making, and that has really helped. Lastly, the paid efficiency has also improved, which has helped to improve the unit economics in the business. All put together, we feel very confident about this business. In the coming financial year, we expect to launch a few more apps as well in the adjacent category, which will continue to drive growth in this business as well as more IP integrations, free traffic growth and CRM will help us to monetize our traffic better. Those are some of the things that will drive growth this year in the coming years.

Okay. Thank you, Manish. Jeff, over to you a quick update on Animal Jam and the new game launches.

Thanks, Nitesh. This FY '27 is an exciting year for us. In this upcoming quarter, we've got our first IP integration with Mattel into Animal Jam through their Monster High property, and it was successful in April, and we look for quarterly updates that are going on over the next 6 quarters. We've been the beneficiaries of WildWorks with the centers of excellence in both data analytics and prepping us for greater ramping of user acquisition to really hit the engine is Animal Jam for the monetization of our players. Apple has been more than complementary about the ability of our game to monetize. It's just getting the right users into the game. With the COEs now helping us do that, we're quite optimistic about our prospects. Expansion of our IP to new platforms is important. As we're launching Animal Jam into Roblox and a new Roblox native experience of the beloved Animal Jam property there and have great aspirations for what it can be in FY '27. As Nitish hinted, we are releasing a new game in Q2 of FY '27. That's a hyper-casual game for kids and women here, principally in North America, where we're based kind of on the lines of MONOPOLY GO!, taking a page out of their playbook and experiencing an nostalgic property that we're bringing to life again that's been dormant for a while. This is what's ahead for WildWorks and what we're doing with Animal Jam now in its 16th year of operation. We take great pride in that and protecting the community that we've built. We're introducing a new moderation tool through Aiba, a Norwegian company that using AI in chat moderation and looking forward to looking for new opportunities for AI development in our new game as well. Thank you.

Okay. Thank you, Jeff. Thank you, everyone, for joining us today, and have a good day.

Thank you, members of the management. On behalf of AMBIT Capital, that concludes this conference. Thank you all for joining with us today, and you may now disconnect your lines. Thank you.