Zaggle Prepaid Ocean Services saw a notable 54.8% increase in net profit for Q1 FY26, with revenue driven by AI innovations and strategic initiatives. Profit reached Rs 25.88 crore while revenue climbed 31.4% to Rs 331.49 crore, supported by a robust operational strategy including controlled expenses and a broader customer base.

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Zaggle Q1 Profit Soars 54.8% on Strong Revenue Growth

Zaggle Prepaid Ocean Services reported an impressive 54.8% year-on-year increase in net profit for the June quarter of FY26, driven by robust revenue gains and efficient expense management. The company’s focus on AI-driven product innovation and expanding enterprise clientele continues to fuel its strong financial performance and growth outlook.

Robust Financial Performance in Q1 FY26

For the quarter ended June 30, 2025, Zaggle’s net profit surged to Rs 25.88 crore, up from Rs 16.72 crore in Q1 FY25. Meanwhile, revenue from operations grew significantly by 31.4% to Rs 331.49 crore. Total income for the quarter increased by 33.7%, reaching Rs 343.20 crore as per the standalone financial statements.

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This revenue expansion was supported by controlled expenses, despite some cost increases on the employee front. Total expenses rose 31.9% year-on-year to Rs 308.64 crore from Rs 233.97 crore.

Expense Breakdown and Operational Efficiency

• Other Expenses: Declined marginally by 1.1% to Rs 330.9 crore.
• Employee Benefits Expense: Increased 20.2% to Rs 16.94 crore, reflecting investments in talent and growth.
• Incentives and Cashback Costs: Rose 6.6% to Rs 95.56 crore, supporting customer acquisition and retention.
• Point Redemption & Gift Card Costs: Spiked 51.9% to Rs 167.78 crore, tied to increased loyalty program usage.

Growth Drivers and Strategic Initiatives

Zaggle’s growth in the quarter was not just about strong numbers but also resulted from strategic advancements and broader business developments:

AI-First Product Roadmap

Founder and Executive Chairman Raj P. Narayanam emphasized the company’s shift to an AI-centric product strategy, highlighting deployments of AI technologies across sales automation, customer support, and bill processing. This focus is unlocking new levels of scale and operational efficiency.

Expanding Customer Base and Platform Usage

Operational KPIs showed notable improvement with the number of corporate customers reaching 3,559, marking a 14% year-over-year increase. Platform users grew 17.3% to approximately 3.3 million, demonstrating sustained traction and market adoption.

Strong Revenue Mix

• Program Fees: Saw a remarkable 50.6% year-on-year rise, underscoring demand for Zaggle’s loyalty and spend management solutions.
• Software Fees: Increased 14.6%, reflecting steady growth in subscription-based offerings.
• Propel Loyalty Platform: Advanced by 19.8%, further reinforcing Zaggle’s position in the loyalty management space.

Outlook and Market Position

Zaggle reaffirmed its full-year guidance for FY26, targeting a topline growth of 35-40% along with EBITDA margins of 10-11%. The management commented on the seasonality pattern which historically sees stronger revenues in Q3 and Q4.

On the M&A front, Zaggle aims to expand its spend management footprint, as evidenced by the recent announcement to acquire Dice Enterprises for Rs 123 crore, reinforcing its market leadership.

Conclusion

Zaggle Prepaid Ocean Services continues to demonstrate robust growth fueled by strong revenue performance, controlled expenses, and an innovative AI-first approach. With a growing corporate client base and expanding platform users, along with sustained focus on product innovation and strategic acquisitions, the company is well-positioned to achieve its ambitious FY26 targets.

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