Nazara returns to profit in Q2 FY27; advertising accounts for 54% of total cost

Nazara Technologies, a gaming and sports media company, reported a 52.7% year-on-year increase in operating revenue in Q2 FY27 and returned to profitability despite a 3.6-fold jump in advertising expenses.

The company’s operating revenue increased 52.7% to Rs 803 crore in Q2 FY27 from Rs 526 crore in Q2 FY26, according to its unaudited financial statements filed with the National Stock Exchange.

On a half-yearly basis, Nazara’s operating revenue grew 20.2% to Rs 1,232 crore in H1 FY27 from Rs 1,025 crore in H1 FY26.

Gaming remained the largest revenue contributor, accounting for 81.7% of operating revenue. Revenue from the segment jumped 2.22X to Rs 656 crore in Q2 FY27 from Rs 296 crore in the year-ago quarter.

Meanwhile, revenue from the ad-tech business declined 13.9% to Rs 124 crore from Rs 144 crore. The esports segment also reported a 73.6% drop in revenue to Rs 23 crore from Rs 87 crore during the same period.

Advertising and business promotion emerged as the largest cost for the firm, which surged 3.6 times to Rs 417 crore in Q2 FY27 from Rs 116 crore in Q2 FY26. Employee benefit expenses increased 9.2% to Rs 85.21 crore from Rs 78 crore during the same period.

Content, event and web server expenses declined 58.3% to Rs 66.75 crore from Rs 160 crore, while depreciation expenses rose 20.6% to Rs 73.56 crore from Rs 61 crore. Commission expenses fell 2% to Rs 50 crore from Rs 51 crore, whereas other expenses increased 11% to Rs 75.5 crore from Rs 68 crore.

As a result, Nazara’s total expenditure increased 43.8% to Rs 768 crore in Q2 FY27 from Rs 534 crore in the corresponding quarter last fiscal year.

Despite the revenue growth, The Mumbai based company returned to profit Rs 35.36 crore compared from around Rs 34 crore loss in Q2FY26. The company reported a net loss of Rs 47.11 crore in H1 FY27, compared to a net profit of Rs 17.41 crore in the first half of FY26.

At the close of trading, Nazara Technologies’ shares settled at Rs 399.95, giving the company a market capitalisation of approximately Rs 16,402 crore.

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