Tips Music — Q3 FY26 earnings call

Call held 19 Jan 2026

Management summary

Tips Music delivered strong Q3 FY26 results with robust revenue, EBITDA, and PAT growth, driven by its content catalogue and digital platform performance. Margins expanded significantly, and the company declared a dividend. While content acquisition was lower than planned due to a movie shift, management remains confident in achieving full-year guidance and is actively navigating the evolving monetization landscape of platforms like YouTube Shorts.

Highlights

  • Revenue of INR 94.29 crores, up 21% YoY.

  • Operating EBITDA of INR 74.5 crores, up 34% YoY.

  • Operating EBITDA margins expanded to 79% from 72%.

  • PAT of INR 58.7 crores, up 33% YoY, with PAT margins at 62%.

  • Cumulative YouTube channel subscriber base grew to 145.3 million.

  • Dividend of INR 5 per share declared, with total payout of INR 166.18 crores, fulfilling commitment to return 100% of last year's PAT.

Concerns

  • Employee expenses included a one-time impact of INR 96.7 lakhs related to the new labor code.

  • Content cost for FY26 is expected to be lower at 18% (vs. 25% target) due to one movie shifting to next year.

  • YouTube views experienced a decline, partly attributed to YouTube Shorts, which currently operates on a lump-sum model rather than profit-sharing.

Key financials

2 periods

Headline

  • Revenue
    ₹94.29 Cr
    YoY +21%
  • Operating EBITDA
    ₹74.5 Cr
    YoY +34%
  • Operating EBITDA Margin
    79%
  • PAT
    ₹58.7 Cr
    YoY +33%
  • PAT Margin
    62%

9M

  • FY26 Revenue
    ₹271 Cr
    YoY +17%
  • FY26 PAT
    ₹157.7 Cr
    YoY +16%

What they filed

Q1 FY27: revenue up 21.6%, net profit down 4.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue81 78 78 88 89 +10%94 +21%104 +33%107 +22%
EBITDA59 56 37 57 68 +15%75 +34%77 +108%54 −5%
Net profit48 44 31 46 53 +10%59 +34%59 +90%44 −4%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Dividend ₹5/share (interim)
    With these results, the Board has approved a dividend of INR5 per share amounting to INR63.91 crores with a total payout of INR166.18 crores in this year. With this, the company has fulfilled its commitment to return 100% of last year's PAT to shareholders.
  • Liquidity Cash ₹303 Cr
    As on December end, it is around INR303 crores.

Guidance & targets

Revenue

  • FY26 Revenue Growth Revenue · FY26 · High confidence 20%
    We are experiencing strong momentum of our content usage across all platforms. These encouraging trends support our 20% revenue growth guidance and allow us to upwardly revise our PAT growth guidance to 25% for this year from 20% earlier.

    — Kumar Taurani

  • FY27 Revenue Growth Revenue · FY27 · High confidence 20%
    No, we are doing 20% of the top-line right now. Like this, the current year, we had already told that we will have guidance of 20%-20%. Next year also, the guidance is of 20%-20%.

    — Kumar Taurani

  • Next Year Revenue Target Revenue · Next Year · Medium confidence INR 450-455 crores
    Our top line target is , I think 372 . I feel at present 20 % growth is targeted. . So, next year our target is 450 or 455. Something like that. Which I think we will achieve.

    — Kumar Taurani

  • Current Year Revenue Target Revenue · Current Year · Medium confidence INR 372 crores
    Our top line target is , I think 372 . I feel at present 20 % growth is targeted.

    — Kumar Taurani

Profitability

  • FY26 PAT Growth Profitability · FY26 · High confidence 25%

    Previously 20% → 25%

    We are experiencing strong momentum of our content usage across all platforms. These encouraging trends support our 20% revenue growth guidance and allow us to upwardly revise our PAT growth guidance to 25% for this year from 20% earlier.

    — Kumar Taurani

  • FY27 PAT Growth Profitability · FY27 · High confidence 20%
    No, we are doing 20% of the top-line right now. Like this, the current year, we had already told that we will have guidance of 20%-20%. Next year also, the guidance is of 20%-20%.

    — Kumar Taurani

Content Cost

  • FY26 Content Cost Content Cost · FY26 · Medium confidence 18%

    Previously 25% → 18%

    No, content cost will be low this year. I think around 18% will be the content cost and actually we wanted to spend 25% but our one movie shifted to next year.

    — Kumar Taurani

  • FY27 Content Cost Content Cost · FY27 · Medium confidence 25%-28%
    No, 25%-28%. That is our maintenance.

    — Kumar Taurani

Platform Growth

  • Spotify Subscription Growth Platform Growth · Soon (next 4-6 quarters) · Medium confidence 30%
    if it continues in this pattern, then what used to happen earlier, same as before we will achieve the growth of 30%, very soon, I think in the next 4, 6 quarters, we will come back to the 30% target.

    — Kumar Taurani

Industry Outlook

  • Industry Size Industry Outlook · Next 4-5 years · Low confidence INR 10,000 crores

    From INR 3,500-4,000 crores today

    Please understand, like the target of the industry is that in the next 4 to 5 years, this industry should be of INR10,000 crores, which is now at present of INR3,500 crores, INR4,000 crores.

    — Kumar Taurani

Monetization

  • YouTube Shorts Monetization Model Monetization · Medium to long term · Medium confidence Revenue Share

    Previously Fixed Fee → Revenue Share

    So,, in case of shorts, we are saying over a medium to long term, that model would move from a fixed fee to a revenue share. It won't happen on an immediate basis, but on a medium to long term, it would happen.

    — Sushant Dalmia

What to watch in Q4 FY26

FY26 Revenue and PAT Guidance Achievement

Next quarter (Q4 FY26 results)
Current Revenue 20%, PAT 25% (revised up from 20%)
Target Achievement of 20% revenue and 25% PAT growth for FY26

Why it matters

Verifies management's confidence in achieving revised full-year targets despite Q4 challenges and lower content spends.

As of now, I am not changing this. I think we will achieve this 20% and we are very positive. Even this quarter responded well, YouTube, Spotify, we are doing well. So, I feel the 20% for yearly guidance is maintained. We can achieve this and we are really pushing hard and working very hard to achieve that.

Risks & concerns

  • Challenge in acquiring quality content at fair price

    medium

    Getting the correct content at the correct price is a struggle, but the company is working hard.

    Management acknowledged

  • YouTube Shorts monetization model (fixed fee vs. profit share)

    medium

    Currently, YouTube Shorts provides a lump sum, not profit-sharing, which limits direct revenue upside from views. A transition to revenue share is expected in the medium to long term.

    Management acknowledged

Q&A highlights

6 direct
FY26 Growth Aspirations vs. Q4 Ask Rate and Content Spends Direct
As of now, I am not changing this. I think we will achieve this 20% and we are very positive. Even this quarter responded well, YouTube, Spotify, we are doing well. So, I feel the 20% for yearly guidance is maintained.

Analyst questioned the feasibility of 20% FY26 growth given lower Q3 content spends and a high Q4 ask rate, prompting management to reaffirm confidence.

Asked by Kavish Parekh

FY27 Content Release Plan (Hindi Movies) Direct
We have Imtiaz Ali, Diljit Dosanjh, Vedang Raina, Sharvari and A. R. Rahman's music and then there is a David Dhawan, Varun Dhawan movie “Hai Jawani Toh Ishq Hona Hai”... And then Shania Kapoor, Abhay Verma movie called JC. And there is so many non-film music slated for FY27.

Analyst sought specific details on the content pipeline for FY27 to gauge future growth drivers, leading to a list of upcoming projects.

Asked by Kavish Parekh

Negative Growth in YouTube Views and Shorts Monetization Partial
These things happen. One quarter you will see it come down. Next quarter you will see again there is a big jump. These things happen. So, we are not actually bothered and plus from this YouTube Shorts we are getting a lump sum money. We are not getting on a profit-sharing basis.

Analyst highlighted a decline in YouTube views, linking it to Shorts and its limited monetization, to which management clarified their current lump-sum revenue model and lack of concern.

Asked by Kavish Parekh

Margin Compression and Target Content Cost Direct
Jyoti, if you check our last, I think, 13, 14, 15 quarters, we are maintaining our EBITDA impact. So, going forward also we will maintain that. I am assuring you that. Plus, as told many times earlier, we are very focused on our content.

Analyst probed on potential margin pressure from competition and content costs, with management assuring margin maintenance through focus on quality and cautious acquisition.

Asked by Jyoti Singh

Spotify Subscription Growth Impact on Revenue Direct
Spotify, I'll tell you one more thing, that Spotify, who were saying for a long time that they want to increase their subscription, their subscription is increasing very fast. I think, compared to last year, this year, they have more than 50% subscribers. So, if it continues in this pattern, then what used to happen earlier, same as before we will achieve the growth of 30%, very soon, I think in the next 4, 6 quarters, we will come back to the 30% target.

Analyst asked for quantification of revenue benefit from Spotify's subscription growth, leading to management's positive outlook on achieving a 30% growth target.

Asked by Ravi Naredi

Revenue Contribution from Legacy Catalogue Content Direct
As told you earlier, 85% of our business comes from a legacy Catalogue and our Catalogue is really, really extremely doing well for the last four, five years.

Analyst sought clarity on the proportion of revenue derived from legacy content, confirming its significant contribution (80-85%) and strong performance.

Asked by Saket Mehrotra

Profitability Outlook for Next Year with Increased Content Acquisition Direct
So, let us say all the content get released during next year. We will see more revenue from that and the revenue could be higher than 20%. And PAT, at least we will get that 20%.

Analyst questioned how 20% bottom-line growth could be maintained with higher content acquisition costs, and management explained it through higher potential revenue from timely content releases.

Asked by Rohit Singh

YouTube Shorts Monetization Model Transition Timeline Partial
So,, in case of shorts, we are saying over a medium to long term, that model would move from a fixed fee to a revenue share. It won't happen on an immediate basis, but on a medium to long term, it would happen. ... Too early to say.

Analyst pressed for details on the timeline for YouTube Shorts monetization model transition, revealing that while a shift to revenue share is expected, the specific renegotiation tenure is not yet clear.

Asked by Yashowardhan Agarwal

2 min read 6 chapters

Detailed narrative

Q3 FY26 Performance Highlights

Tips Music reported a robust Q3 FY26, with revenue growing 21% year-on-year to INR 94.29 crores. Operating EBITDA saw a significant 34% increase, reaching INR 74.5 crores, and margins expanded to 79% from 72% in the prior year. Profit After Tax (PAT) also demonstrated strong growth, rising 33% to INR 58.7 crores, with PAT margins at 62%. For the nine-month period, revenue stood at INR 271 crores, a 17% growth, and PAT was INR 157.7 crores, up 16%.

Content Strategy and Digital Platform Momentum

The company highlighted strong momentum in content usage across all platforms, driven by its extensive and performing catalogue. The cumulative YouTube channel subscriber base grew significantly to 145.3 million. Viral catalogue tracks on Instagram led to a 100X spike in content creation, views, and streams. Tips also announced a partnership with B4U TV to expand the reach of its rich catalogue among global television audiences.

FY26 and FY27 Guidance and Content Costs

Management reiterated its FY26 revenue growth guidance of 20% and upwardly revised its PAT growth guidance to 25% from an earlier 20%. For FY27, the company targets 20% revenue and 20% PAT growth. Content cost for FY26 is expected to be around 18% (lower than the initial 25% target due to one movie shifting to next year), while for FY27, it is projected to be 25%-28%. Management expressed confidence in achieving these targets, emphasizing cautious content acquisition.

Shareholder Returns and Liquidity Position

The Board approved a dividend of INR 5 per share, amounting to INR 63.91 crores, with a total payout of INR 166.18 crores for the year. This fulfills the company's commitment to return 100% of the previous year's PAT to shareholders. The company maintains a healthy liquidity position, reporting a cash balance of approximately INR 303 crores as of December end.

YouTube Shorts Monetization Evolution

Management discussed the evolving monetization landscape of YouTube Shorts. Currently, Shorts operates on a lump-sum payment model rather than a profit-sharing basis, which management acknowledges can lead to fluctuations in reported views. However, they anticipate a transition from a fixed fee to a revenue share model for Shorts monetization in the medium to long term, with renegotiation expected in the second quarter of FY27, which could significantly impact future digital revenue streams.

Catalogue Strength and Industry Outlook

Tips Music emphasized that 80%-85% of its revenue continues to come from its legacy catalogue, which is performing exceptionally well and driving consistent growth. Management expressed strong confidence in the long-term potential of the music industry, projecting it to grow from its current size of INR 3,500-4,000 crores to INR 10,000 crores in the next 4-5 years, highlighting the company's strong position within this expanding market.

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