Zee Entertainment Enterprises reported a 5.1% year-on-year decline in third quarter (Q3FY26) profit to Rs 155 crore on Thursday, as subdued advertising demand and rising programming expenses continued to weigh on earnings.
Operating profitability (Ebitda) took a sharp hit in Q3, down 20.3% versus last year to Rs 256 crore. While margins declined 500 basis points to 11.2% in Q3 versus 16.2% reported last year.
While Q3 revenue rose 15.2% year-on-year to Rs 2,280 crore, advertising revenue, which accounts for around 40% of its topline, fell 9.4% from a year earlier to Rs 851 crore. Sequentially, however, ad revenue was up 5.7% from Rs 806 crore reported in Q2FY26.
Broadcasters such as Zee and Network18, which derive a significant share of revenue from advertising, have faced sustained pressure over the past year amid cautious marketing and promotional spends by consumer goods companies as the latter weather demand concerns.
What did Punit Goenka say?
In an earnings call on Thursday, Punit Goenka, CEO, Zee Entertainment, admitted that the broadcaster remained significantly exposed to the FMCG sector, which is its largest advertising category.
“Any improvement in the FMCG sector has an immediate impact on our business and vice versa,” he told investors.
The weakness in ad sales has forced broadcasters to lean more heavily on subscription growth and film-related income to offset softer advertising trends.
Subscription revenue offered some relief
Subscription revenue offered some relief, rising about 7% year-on-year to Rs 1,050 crore during the quarter, reflecting steady growth in paid viewership despite a challenging operating environment. Sequentially, subscription revenue was up 3% versus Q2, it said.
The results underline the pressures facing India’s television and media companies as they navigate a prolonged slowdown in advertising alongside persistently high content costs, even as they seek to rebalance revenue streams towards subscriptions and digital platforms.
The company said ZEE5 revenues grew 73% year-on-year during Q3 FY26 to Rs 418 crore, and added that the digital business delivered positive EBITDA of Rs 56.4 crore during the quarter, its first after delivering losses previously.
For the first nine months of the year, Zee5 crossed revenue of Rs 1,000 crore in revenue, which the company said was a significant milestone for the digital business.
The company also released 39 shows and movies including 11 originals on Zee5 and would continue this momentum in the coming quarters.
Zee Entertainment closed trade at Rs 85.10 apiece on the BSE on Thursday, up 3.86% versus the previous day’s close.