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    Zee Entertainment Enterprises Q4 FY26 earnings call

    ZEEL
    Media, Entertainment & Publication·19 May 2026
    Management Summary

    Zee Entertainment reported a strong Q4 FY26 for its digital business, with ZEE5 achieving breakeven and significant revenue growth. The broadcast segment maintained its strong market position despite a 4% YoY decline in advertising revenues, impacted by geopolitical events. Strategic investments were made in VFX and Live businesses, while cost optimization led to a 16% QoQ reduction in employee costs. The company also revised its movie amortization policy, resulting in a one-time charge.

    Highlights

    5

    • Digital business (ZEE5) achieved breakeven in FY26, delivering positive EBITDA compared to a loss of INR 548 crores in the previous year.

    • ZEE5 Q4 FY26 revenue grew 71% YoY to INR 470 crores, marking its highest-ever revenues in the digital business.

    • Overall network share increased by 80 basis points to 17.4% during Q4 FY26, with March share exceeding 18%.

    • Flagship Hindi GEC, Zee TV, displayed robust GRP growth of 40% and 21% stronger performance than competitors.

    • Employee costs were optimized, decreasing 16% QoQ and 9% YoY, contributing to cost efficiency.

    Concerns

    4

    • Overall advertising revenues declined 4% YoY in Q4 FY26, primarily due to the Middle East conflict impacting ad spends in March.

    • Other sales and services in the Studios business declined by 47% in Q4 due to muted performance.

    • A one-time charge of approximately INR 300 crores was recognized due to a revised movie amortization policy.

    • Sequential viewership share saw a slight decline from 17.8% to 17.4% in Q4, attributed to market events like the T20 World Cup and Bengal elections.

    What Changed1

    vs Q1 FY27

    Guidance items7 → 4 (-3)

    Key financials

    Single quarter

    06 metrics
    1. 01ZEE5 Q4 Revenue₹470 Cr+71%YoY
    2. 02ZEE5 FY26 Revenue Growth—+53%YoY
    3. 03ZEE5 FY26 EBITDA—
    4. 04Advertising Revenue Growth—-4%YoY
    5. 05Subscription Revenue Growth—+4%YoY

    Capital allocation

    3
    high confidence
    CategoryHeadline
    M&A

    CORE Private Limited

    acquisition · announced · Consideration ₹20 crores

    M&A

    Phantom Digital Effects Limited

    acquisition · announced · Consideration ₹116 crores

    Liquidity

    Cash ₹750 crores

    Cash and treasury investments as of March 2026 stood at a healthy INR 27.6 billion, comprising of cash balance of INR 7.5 billion, fixed deposits and other treasury investments of INR 7.8 billion and mutual fund investments of INR 12.3 billion.

    Guidance & targets

    4
    CategoryTargetPriority
    Profitability
    ZEE5 EBITDA Breakeven
    Achieved
    		High
    Profitability
    ZEE5 Investment Level
    Optimum
    		High
    Cost Efficiency
    Employee Cost to Revenue Ratio
    9%
    		Medium
    Revenue Mix
    ZEE5 Ad vs Subscription Revenue Mix
    50-50
    		Medium

    What to watch in Q1 FY27

    5

    Advertising Revenue Growth

    next quarter
    Current-4% YoY in Q4 FY26 (would be low single-digit growth ex-March impact)
    TargetPositive growth, recovering from Q4 dip

    Why it matters

    Ad revenue is a key driver for the broadcast business and was impacted by external factors this quarter; recovery is crucial.

    As a result, our overall advertising revenues declined 4% year-on-year. Adjusted for the impact in the month of March, our advertising revenues would have witnessed low single digit growth in Q4 despite the shifting of ILT20 to quarter 3.

    Risks & concerns

    3
    RiskSeverity

    Geopolitical environment and macroeconomic headwinds

    Disrupted consumer sentiments and impacted overall growth across sectors and the industry, particularly affecting advertising spends. — Management acknowledged

    medium

    Advertising spending cyclicality

    Advertisers are adopting a cautious approach due to the ongoing West Asia uncertainty, leading to a 4% YoY decline in Q4 ad revenues. — Management acknowledged

    medium

    Competition in Music Business

    International players entering the market are a reason for not disclosing Zee Music metrics, indicating competitive pressures. — Management acknowledged

    low

    Q&A highlights

    8

    “The reason we are investing in these back-end businesses because just like we invested in music and in the studio business, all these are complementary to the way the entire entertainment landscape is changing. And VFX and these kinds of things will come into the television space as well.”

    Clarifies the rationale behind new strategic investments in non-core areas, linking them to future entertainment landscape and cost efficiency.

    asked by Abneesh Roy

    2 min read5 chapters

    Detailed Narrative

    01

    Digital Business (ZEE5) Achieves Breakeven and Strong Growth

    Zee's digital business, ZEE5, achieved breakeven during FY26 and was operationally profitable for the second consecutive quarter. The platform reported a robust 71% year-on-year revenue growth in Q4 FY26, reaching INR 470 crores, and a 53% YoY growth for the full year. This performance translated into a positive EBITDA for FY26, a significant turnaround from a loss of INR 548 crores in the previous year, meeting the company's guidance.

    02

    Broadcast Network Share Gains Amidst Ad Revenue Headwinds

    The broadcast business maintained its position as India's second-largest TV entertainment network, with its network share increasing by 80 basis points to 17.4% during Q4 FY26 and exceeding 18% in March. However, overall advertising revenues declined 4% year-on-year. This decline was primarily attributed to the Middle East conflict, which led advertisers to hold back spends in March, though adjusted for this impact, revenues would have seen low single-digit growth.

    03

    Strategic Investments in Content and Live Entertainment

    Zee made strategic investments to bolster its content creation capabilities and expand into emerging segments. This included an investment of INR 20 crores in CORE Private Limited to enhance its Live business and up to INR 116 crores in Phantom Digital Effects Limited. The latter aims to strengthen capabilities in VFX, animation, gaming, and comics, aligning with the evolving entertainment landscape and the company's focus on immersive content.

    04

    Revised Movie Amortization Policy and Cost Optimization

    The company revised its movie inventory amortization policy to better reflect consumption patterns, shifting from a straight-line 5-year method to a more front-ended approach, with 50% amortized in the first two years. This change resulted in a one-time📎 charge of approximately INR 300 crores. Concurrently, Zee focused on cost optimization, achieving nearly flat overall operating costs year-on-year and reducing employee costs by 16% QoQ and 9% YoY, with an objective to bring the employee cost to revenue ratio back to 9%.

    05

    Liquidity Position and Market Dynamics

    Zee maintained a healthy liquidity position, with cash and treasury investments totaling INR 27.6 billion as of March 2026, including INR 7.5 billion in cash. Management acknowledged the impact of the uncertain geopolitical environment and macroeconomic headwinds🌐 on consumer sentiments and advertising spends. They also noted that specific market events, such as the T20 World Cup and Bengal elections, influenced sequential viewership share during the quarter.

    This is an AI-generated summary of a publicly available earnings call transcript.