OnMobile Global Limited

OnMobile Global reported Q4 FY25 revenues of INR 583 crores, marking an 11.5% year-over-year improvement. This growth was primarily fueled by the gaming segment, which saw a 158% increase in revenue to INR 207 crores and a 58% rise in its subscriber base to 10.65 million. Despite this, mobile entertainment revenue declined by 15% to INR 376 crores.

EBITDA for the year stood at INR 14.1 crores (2.5% margin), a slight reduction attributed to a significant decrease in capitalization from INR 64 crores in FY24 to INR 10.6 crores in FY25, with most expenses now absorbed in the P&L. The company reported a negative PAT of INR 40 crores, also impacted by the amortization of gaming intangibles. For FY26, the company aims to limit capitalized investment to $1 million.

Management emphasized a distinct focus on cash generation, with the closing cash balance increasing by INR 6.6 crores from last quarter to INR 40.2 crores. The gaming unit is now profitable and generating cash, allowing for continued investment in product innovation while reducing capitalization. The company targets a 50% growth in its gaming business for FY26 and a monthly recurring revenue run rate of INR 2 million within 12-18 months.

To counter the 15% decline in mobile entertainment, OnMobile has signed a large multi-year deal with a major telco in Asia, expected to contribute significantly to revenue from this year. Additionally, plans are underway to launch a premium entertainment service with a large European telco and two new On Tones launches in the first two quarters of FY26, aiming for a 5% growth in this segment.

The previously planned $30 million QIP for M&A and CapEx has been put on hold due to prevailing market conditions and concerns about dilution at aggressive rates. Management prefers to stage opportunities over time^⏳, manage cash, and ensure favorable pricing for any future fundraising or acquisitions, as the company's cash position is currently growing.

Management expressed a long-term vision of achieving a $300 million global business within 3-5 years, leveraging its 25 years of experience with mobile operators, network management, and billing integration. This deep-rooted expertise is seen as a significant barrier to entry for competitors in the mobile gaming and entertainment space, enabling execution on gaming initiatives.

AI is recognized as a critical area, with initial applications already launched, such as AI-based tunes with a Middle Eastern operator. The company plans to integrate AI across all aspects of its operations, including product differentiation, operational efficiency, and marketing campaigns, expecting significant upside in the next 18 months, despite not having fully implemented AI across the board yet.