Subex Ltd (NSE: SUBEX) Q3 2026 Earnings Call dated Feb. 11, 2026
Corporate Participants:
Nisha Dutt — Managing Director and Chief Executive Officer
Analysts:
Unidentified Participant
Pratik Jagtap — Analyst
Sanjyot Khare — Analyst
Mahesh Kumar — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q3FY26 earnings conference call of Subics Limited. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Do you need assistance during the conference call? Please signal an operator by pressing Star then zero on a touch tone phone. Please note this conference is being recorded. I would now like to hand the conference over to Mr. Pratik from EY IR agency of Subex Limited. Thank you. And over to you, sir.
Pratik Jagtap — Analyst
Thank you, Karthik. Good morning to everyone. We have joined the earnings call for the quarter ended December 31, 2025. I would like to introduce the members of the management who are present for the call. Ms. Nisha Dutt, Managing Director and CEO. Mr. Sumit Kumar, CFO. Mr. Harisha Angeri, Head Corporate Strategy and AI. And Mr. Ramu Akili, Company Secretary and Compliance Officer. I would like to start the conference call by going through the safe harbor clause. Such statements in this presentation concerning our future group prospects are forward looking statements which involve several risks and uncertainties that could cause actual results to differ materially from those in such forward looking statements.
These risks and uncertainties relating to these statements include, but are not limited to fluctuations in earnings, our ability successfully integrate acquisition competition in our areas of business, client concentration, liability for damages in our contracts, withdrawal of tax incentives, political instability, unauthorized use of intellectual property and general economic conditions affecting our industry. With this I now hand over the call to Nisha Dutt to take it forward. Over to you Nisha.
Nisha Dutt — Managing Director and Chief Executive Officer
Thank you Prateek and good morning everyone and thank you for joining us today. I’m happy to report that in Q3 Quebec maintained its steady path towards sustainable recovery. The process that we have been talking about over the past few quarters is now beginning to translate into visible outcomes. But before I get into the numbers, let me start with an important governance update. We have successfully onboarded two independent directors aligned with shareholder expectations. We concluded the induction process and held our first board meeting with the reconstituted board yesterday. It was a very constructive session, healthy dialogue, diverse perspectives and strong engagements.
I’m confident that this trend and board will add significant value as we move forward. Now, coming to the Q3 performance, we delivered a 2.7% sequential top line growth with a normalized ebitda margin of 13.1% and a PAT margin of 10.8%. Our continued focus on operational discipline is clearly reflected in the bottom line. Importantly, we have sustained profitability at both the EBITDA and PAT levels and reinforcing the stability that we have been building. And I think that this quarter’s performance is not incidental. It’s the outcome of strategic groundwork laid over the last 12 to 18 months.
The implementation cycle is now in full swing. Our order book remains strong, supported by both new logo additions and renewals. A notable win this quarter was fraud management engagement with a leading European operator, which further strengthens our footprint in the market. One of the standout achievements in Q3 was successful commercialization of fraud SaaS, a product that we took from concept to customers within just a year. So this speed reflects the increased agility and shopper execution across our teams. This capability is also evident in our order bookings and pipeline, both of which remain healthy as we enter the final quarter of the fiscal year.
These outcomes are driven by strong product discipline and prudent capital allocation. We are prioritizing AI investments with clear customer value and commercial pathways which has enabled a systematic conversion of POCs into production deployments. I’m also happy to share that a European customer is currently funding proof of concept of our gen AI agents. This is again very, very encouraging for us that telcos are now embracing the new technologies. Engagement from some of the largest Europeans in North America and Europe I think is a strong validation of the maturity, credibility and enterprise readiness of our AI capabilities.
Importantly, these proof of concepts are not exploratory experiments. They are being done with clearly defined success metrics and structured pathways to commercialization and we are seeing systematic conversion into paid engagements. So several of the AI use cases that we are delivering are already live in production environments. This reflects a meaningful shift in our revenue mix. SOBEX today is delivering mature enterprise grade AI solutions embedded directly into customer operations. As we all know, LLMs and AI models are reshaping industries globally. In response to this a structural shift both in our priorities and in how we build and deliver the product.
You must have noticed that last quarter we undertook rebranding of sobex. This reflects our transition into a more AI native operating model. We wanted to ensure that our identity ensures that our transformation is clearly articulated to all our stakeholders. Our timeline new possibilities now possible underscores the tangible outcome driven impact to our solutions. True to our customer first ethos, we unveiled this brand at our user Conference in November in Athens alongside our customers. So the user conference was really a great platform for us to engage deeply with our key clients, gather voice of customer insights, exchange perspectives on evolving telecom landscape.
These conversations are instrumental in sharpening our product portfolio and ensuring that our roadmap remains tightly aligned with the market needs. On talent front, we have strengthened our leadership team with the appointment of a new Head of HR and new legal counsel, reinforcing our focus on organizational debt and governance. Finally, as discussed on the last call, I know this has been we have been talking about it for a while but we had intended to host the investor day but due to scheduling constraints we were unable to finalize it this year. But we definitely plan to hold it in the next financial year and we will definitely share details in due course.
Next I shall cover the consolidated financial results for Q3. Revenue for the quarter stood at 70.79 crores as against 68.9 crores for the previous quarter. Normalized EBITDA for the quarter was at 9.2 crores against 7.3 crores for the previous quarter. Normalized PAC for the quarter was at 7.68 crores as against 3.9 crores for the previous quarter PAC for the quarter was at 2.9 crores as against 2.8 crores including exceptional item in the previous quarter and the new labor code impact is quantified as 4.5 crores for past service liabilities and the same has been represented at exceptional cost in the results.
And now those are the results and as always now I’ll brace for the real action. Your questions and comments.
Questions and Answers:
operator
Thank you ma’. Am. Ladies and gentlemen, we will now begin the question and answer session. If you have a question, please place Star and one on a telephone keypad and wait for your turn to ask a question. If you would like to withdraw your request, you may do so by pressing Star and one. Again. The first question from the line of Sanjot Kare, an individual investor. Please go ahead with your question.
Sanjyot Khare
Hello, good morning. Good morning Nisha and really good to see Chan around. Congratulations to your team. Good operational performance and feedback about good branding and good to see a change into the logo as well as the website. It looks really nice. Thank you. My question is we have seen a good number of deal wins in last three, four months and that’s really a great congratulations on that. My question is are we going to see the conversion of that? I mean the revenue will start converting from Q4 or it will start from Q1 for these big deals won in last three months. Generally your Q4 is generally a heavy quarter and in March as well. So. And second question is about there are a lot of updates happening in geopolitical side. The there was a tariff agreement happened with EU and Europe, EU and us. So now are we seeing that the market is opening up and are we seeing the conversions or of the discussions are happening and big momentary momentum is getting better.
Nisha Dutt
Thanks Sanjay. First of all, I mean we are also very encouraged by the deal conversion and we have seen some momentum in the last few quarters in terms of revenue conversion. The way it works is so we have, you know, there are two distinct lines emerging. So in terms of our traditional, you know, rafm products which are more hypersense based or rock based, there we see the revenue conversion happening a little later because as you know that model kicks in when we complete our implementation. So the tax revenue or you know, the subscription revenue kicks in a little later.
So I would say three quarters after the deal is announced, small part of revenue is taken when we initiate the project obviously which is, you know, more around the set of costs and some of those milestones. But the bulk of it comes after our implementation which typically takes three weeks Sorry, three quarters or so. So that’s first part, but on the second line where we have things like cross app and where we are doing more AI LED implementation there, we see a more immediate gain in the revenues actually because it’s more straight line and we start seeing the impact as soon as pretty much sometimes as early as the same quarter.
So that’s why we are trying to accelerate our AI line of business where we feel that revenue conversion can be faster actually. So that hopefully answers some of your questions. In terms of geopolitical side, this has been an interesting time. We are seeing conversions now from the US but we do have very small, very mild exposure to countries like Iran and Venezuela and all that. So that is where we have some exposure and sometimes our money and our revenue gets stuck. But I would say that that’s extremely controlled right now and it’s minor exposure. So we are seeing the good and the bad both.
So the good is that if you have tariff agreements in place, the trade becomes much easier. But there are still pockets of geopolitical uncertainty for us as a business where either there are currency challenges or the country itself is completely on a blackout mode. We are unable to actually speak to the customers there at all. So yes, the good and the bad both. But I would say that at its tanks, the exposure is extremely controlled because we have a governance framework and we ensure that we never actually exceed, you know, our revenue or our exposure in these countries.
So in that sense, I would say that it’s contained. But yeah.
Sanjyot Khare
Sure. Thanks, Nisha. So on the business dialogues perspective or getting more business, are we seeing our traction now from the Europe and US Is it getting better?
Nisha Dutt
It’s actually getting better. It’s been, you know, you must have seen in the, you know, last few deals that we announced, it was actually Europe and us a lot more and. You know, risk profile goes down significantly when you do business here. So we also want to make sure that we increase the pie here versus, you know, the more riskier geographies. So. But yeah, that pie is definitely looking much better for us now.
Sanjyot Khare
All right, thank you and I’ll come back in the queue.
operator
Thank you. We request for participants to restrict the two questions in the initial round and join back the queue for more questions. Next question comes from the line of Mahesh Kumar, an individual investor. Please go ahead.
Unidentified Participant
Yeah, good morning, Nisha. I have first question related to project and you have recently launched and got a customer also and price seems to be right for the market. So what is your estimate for the revenue from the Crowd app till 2030.
Nisha Dutt
Interesting question. So for us I think again to be honest, it’s early days so I’m unable to kind of really answer that question. But what we were wanting to do is we definitely wanted that set. I wanted to challenge the team to see if they could develop something very very quickly which is wide coated pretty much. But more importantly can we commercialize it, take it to market, have a paying customer. All of that has happened within a year. So that gives us the confidence that there is market out there for this. And more importantly, this market is coming from developed economies which is even better for us.
Right. So I think I can answer this question a lot more confidently to you maybe in next two quarters because we are planning. But you might have done analysis, no. When you are going yeah, of course, of course we have. But what we want to do, establish.
Mahesh Kumar
What analysis I have done. For fraud gap addressable market is 1 to 2 billion dollars. Okay. Out of that which subex can obtain is around rupees 6800 crore. Now if your conversion rate is 2%, 5%, 8% by 2030 revenue should be 540 crore.
Nisha Dutt
So see prod SAP is currently the way it’s built. Just also to clarify for you and the other, you know, listeners. So Prods app is built pretty much like I would say a platform on which we are able to do different use cases. So currently the use case that is active is device fraud. And if I look at let’s say device fraud as a market it’s 4.5 billion or 4.2 billion actually to be.
Mahesh Kumar
Precise, that is a total, total addressable market. But today’s conversion rate is very low.
Nisha Dutt
I’m coming there. So basically device fraud market is around 4.2 billion, right? And all of 4.2 billion. Or even if you look at, you know, device fraud as a market that is not addressed solely by fraud start, there are many competing offerings in the market. Of course I think the way we are going about it is quite unique. However, even before we launched fraudstack we were also following device fraud through regular or I would say more traditional AIML model. Those means so mobile money itself is 2.5 billion. So if you look at TAM, it’s large but there are other solutions in the market.
But for us where we are going is it’s a light solution. It can actually be used even in mvnosis. So that’s where we are trying to go that can we do non CDR fraud actually with this. So market sizing has been done Conversion again, because this is our first conversion, we were hoping that. I mean typically if you see our conversion rates hover anywhere between on hypersensine and traditional products and conversion rates hover between 25% 20 to 25% on the pipeline. So the reason I’m unable to answer the question is because we are in the process of building this pipeline.
And once we build this pipeline we’ll be able to certainly say, let’s say that you know, next quarter, what is logically going to be my conversion on these products and hence, you know, what’s the market that I can go after? You are right that we did do the math before we built. Obviously the business case was built but as you know, right. Business cases have to be made real actually in the real market.
Mahesh Kumar
In the previous call you have been telling I will build the product only only when there is a revenue possibility. Okay. So you can’t build a product without doing this analysis.
Nisha Dutt
Of course. Of course, yeah.
Mahesh Kumar
That is what I’m asking. What is your analysis? What is the revenue estimation by 2030? Ah, see I have done only analysis. For the telecom fraud. I have not gone into adjacency. So when I say 1 billion to 2 billion dollar, that is only telecom. Fraud, which is the handset produce dealer. Fraud and related fraud.
Nisha Dutt
That is correct. You are absolutely bang on. Those are the top fraud actually.
Mahesh Kumar
Where your project is fitting, right?
Nisha Dutt
Correct.
Mahesh Kumar
So that market itself is 1 to. 2 billion dollar total addressable.
Nisha Dutt
Correct.
Mahesh Kumar
It is not.
Nisha Dutt
It’s actually higher than DAC. But. But our thing is that I feel that if this can be stood up as a stack. See today if I look at our fraud product market, I mean what Subex is doing right, I think we should be able to leapfrog that. And if I were to say that in a few years, or not even few years, a few years looks like a very long timeline in this day and age. I think in couple of years we should have a few million dollars behind us on this. So this year we are going to aggressively take it into market market.
And the reason I’m really hesitating from giving you some guidance here is because I really want to take one or two quarters, take it aggressively to market. See our conversion rate, see how real we are actually on this product case was made. We are already in revenue positive, right. In that sense I think all our plans are coming through. But can we go after the new growth drivers address new tam? That is what the purpose of this is. Actually I would not be able to. Unlock
Mahesh Kumar
unless you have aggressive target for the sales team, they will not be able to achieve. Of course, of course. I mean, because I mean, see, I. Am estimating that in the first year itself you should have at least 20 customers out of total 2400 customers.
Nisha Dutt
Okay?
Mahesh Kumar
That is what target you should have. And second question is related to, for Prodigy for adjacency. Now in the past calls you are told you will not venture into fintech. And all those area because that is not your core area. Now you are saying we want to venture into adjacency.
Nisha Dutt
No, no, when we say adjacencies, it’s telco fintech. They mean telco fintech. It’s not the reason why I hesitate from going after BFSI as a segment, you know, which also has a lot of syntaxes because there are soft compliances and it’s very compliant heavy sector domain. Where we are going with telco Fintech because I mean, think about device fraud, right? When we think about device fraud, we think of it as transaction monitoring. Actually at the core of it, what are you doing? You are doing transaction monitoring where you are giving intel to, let’s say you go into us and you know, you try to buy.
We are trying to tell that customer or the seller at that point of time, whether you can give this credit to this customer or not, that’s essentially what you’re doing. But it’s some sort of transaction monitoring. And that transaction monitoring can be very easily scaled to a Telco fintech and other places, which we have actually already done in some of our other, you know, through some of our other deals. So that’s how we think about this. So Africa AI deal that we recently announced is actually a telco fin tech, the one that you, you must have actually got,
Mahesh Kumar
you know, maybe that is North America.
Nisha Dutt
Okay, my apologies, we didn’t announce that. But we do have a Telco fintech deal in Africa for instance. So we do announcement. So my point is that at the core of this, this is a transaction monitoring. So what we are doing is transaction monitoring and I feel that is horizontal horizontally. So that’s where we are going when we say that, you know, we want to go horizontal. Telco fintech all come, all telcos are wallets. So can we scale it to that? Yes. Have we scaled it? Yes, we actually have a contract there as well.
Mahesh Kumar
There is no, there is no growth for the sudex for last 10 years. Unless you become aggressive on going for a product which has a utility in the market, the growth will not come.
Nisha Dutt
I completely agree with you. The reason we are not going to even stop all the parts.
Mahesh Kumar
See all the products you are agreeing.
Nisha Dutt
No, no, I am absolutely agreeing.
Mahesh Kumar
But there is no aggressive target for the sales team.
Nisha Dutt
No, no, no, you don’t know that because we do set very aggressive targets. We have a DTM plan in place of how we will take this to market. We actually have sales guys have been given the target. There is a DTM in place. We know how we are going to take this to market and we are going to very aggressive and this is not where we stop. We are actually going to build more products on frauds app and we are going to build more products beyond Fraudstap as well. So we have a whole product roadmap and DTM roadmap so that I would rest assured this is definitely going to happen.
Actually we are tracking net new pipelines and we have roadshows running even as we speak. We have roadshows running in Middle east right now. So we are doing roadshows. So there is a lot of work that’s happening behind us. Obviously when we invest in a product we want to make sure that and even the pipeline that has been converted right within a year of launch of roads app and to the revenue that we announced that has not happened because we were not doing any activity as you can imagine takes time. But we did and we have been in this pursuit for a while.
We wanted to make it real and we had and we do have workshops running. Sales guys have been given way more aggressive target than you are even telling week 20. Actually the targets are very aggressive, they are stringent. But we do want to go after this and we are taking a very like I always say, right? We are going to take a very frugal investment approach. We are taking a Gen AI first approach. Unlike the past product build survey which we have done where obviously it takes a lot more engineering to build those products. Here we are actually able to build products basis just Gen AI and this has been the proof for us.
Right. So I’ll just make a last point.
Mahesh Kumar
And last point and join the queue. See my last point in this question session is see your assurance of that target and everything will be proven when there is a double digit growth in the top line. This assurance we have been listening for two years and there is no growth. You show the double digit growth. I will not ask this question again. Okay. Yeah. Thank you.
operator
Thank you. We have the next question from the line of Abhishek Khale, an individual investor. Go ahead.
Unidentified Participant
Am I audible?
Nisha Dutt
Michelle? [Ends Abruptly]