Revenue Falls 14% as Associate Losses and Impairment Weigh on Earnings
Gaming and sports media company Nazara Technologies reported a weak start to FY27, posting a 14% year-on-year decline in operating revenue while slipping into a net loss of ₹82 crore during the June quarter. The decline was primarily driven by losses from associate companies and impairment charges, despite steady growth in its core gaming business.
Separately, the company also announced a leadership transition, with founder Nitish Mittersain stepping down as Chief Executive Officer (CEO). He will continue as Managing Director, focusing on the company’s long-term strategy and strategic partnerships. Raymond Albaladejo Stauffer will take over as CEO from September 1, 2026.
Revenue Declines as Esports Business Weakens
According to the company’s financial statements filed with the National Stock Exchange (NSE), Nazara’s operating revenue declined 14% to ₹429 crore in Q1 FY27, compared to ₹499 crore in the corresponding quarter last year.
Including ₹9 crore in other income, the company’s total income stood at ₹438 crore, down from ₹576 crore a year earlier.
The decline was largely attributed to weakness in its esports segment, which offset growth across gaming and ad-tech businesses.
Gaming Remains the Largest Growth Driver
Nazara Gaming continued to be the company’s biggest business, contributing over 60% of operating revenue during the quarter.
Revenue from the gaming segment grew 14.1% year-on-year to ₹275 crore, up from ₹241 crore in Q1 FY26.
Meanwhile:
- Esports revenue plunged 81.8% to ₹28 crore
- Ad-tech revenue increased 18.9% to ₹126 crore
The performance highlights the company’s increasing dependence on its gaming and advertising businesses while esports remains under pressure.
Associate Losses Push Company Into Red
Nazara’s total expenditure declined 12.7% year-on-year to ₹455 crore, reflecting tighter cost management.
Advertising and business promotion remained the company’s largest expense at ₹153 crore, followed by:
- Employee benefit expenses: ₹82 crore
- Content, event and web server costs: ₹63 crore
Despite lower expenses, the company reported a net loss of ₹82 crore, compared to a net profit of ₹51 crore in Q1 FY26.
The loss was primarily driven by:
- ₹62 crore share of losses from associate companies
- ₹22 crore impairment charge
This marks one of Nazara’s rare quarterly losses. The company had previously reported a net loss in Q2 FY26 following a write-off related to its investment in PokerBaazi after regulatory changes in the online gaming industry.
Sequential Performance Shows Mixed Trend
On a quarter-on-quarter basis, Nazara’s operating revenue improved 7.8% from ₹398 crore in Q4 FY26 to ₹429 crore in Q1 FY27.
However, profitability deteriorated sharply, with the company swinging from a ₹55.7 crore net profit in the previous quarter to an ₹82 crore loss.
Founder Nitish Mittersain Transitions to Strategic Role
Alongside its quarterly results, Nazara announced a leadership reshuffle.
Founder Nitish Mittersain has stepped down as CEO and will continue as Managing Director, where he will focus on long-term strategy, capital allocation and strategic partnerships.
The board has appointed Raymond Albaladejo Stauffer as the company’s new CEO, effective September 1, 2026, as Nazara enters its next phase of growth.
Outlook
While Nazara’s core gaming and ad-tech businesses continue to deliver healthy growth, the June quarter highlights the impact that associate company losses and impairment charges can have on overall profitability. The leadership transition also marks a significant milestone for the company, with founder Nitish Mittersain shifting towards a strategic role while a new CEO takes charge of day-to-day operations. Investors will closely watch whether the company can improve earnings consistency and revive growth across its esports portfolio in the coming quarters.
