After slipping into the red in the September quarter, gaming major Nazara returned to profitability in Q3 FY26. Its net profit for the December quarter (Q3 FY26) declined 36% to INR 8.8 Cr during the quarter from INR 13.7 Cr in the year-ago period.

It had reported a loss of INR 33.9 Cr in the previous quarter.

Nazara’s operating revenue contracted 24% YoY and 23% QoQ to INR 406 Cr. Including other income of INR 11.3 Cr, total income for the quarter stood at INR 417.3 Cr. 

Total expenses reduced 24% YoY to INR 402.2 Cr. 

Nazara attributed the decline in its revenue to Nodwin Gaming’s deconsolidation from the group. As a result, its revenue from its esports business crashed 85% YoY to INR 34 Cr.

Adjusted for Nodwin deconsolidation, the company claimed that its revenue for the quarter grew 9.8% YoY.

Nazara deconsolidated Nodwin in Q2 FY26 after deciding not to participate in its new round of funding from existing investors. Nodwin was reclassified from a subsidiary to an associate company, triggering accounting changes that affected Nazara’s reported top line.

The company had accounted an other income of INR 1,104.5 Cr in the previous quarter on the back of this reclassification. The gains from this reclassification were partly offset due to the company writing off its stake worth INR 914.7 Cr in real money gaming venture PokerBaazi.

During the quarter under review, Nazara’s EBITDA surged 29% YoY to INR 67.8 Cr.

“We remain focused on disciplined capital allocation, including through strategic acquisitions where Nazara’s operating platform can accelerate scale, improve unit economics, and drive long-term value creation,” Nazara’s CEO Nitish Mittersain said. 

Besides esports, the company’s gaming revenue surged 66% YoY to INR 257 Cr. The adtech business registered a 22% YoY decline in revenue to INR 115.4 Cr.

Nazara’s board also granted an in-principle approval to its Dubai-based subsidiary Nazara Technologies FZ LLC to invest $500K (INR 4.5 Cr) in nCore Games, developer of mobile game ‘FAU-G’. Besides, the board also approved a primary capital infusion of up to INR 15 Cr into digital content development studio Rusk Media.

Shares of Nazara ended today’s trading session 1.3% higher at INR 284.4 on the BSE.