Zee Entertainment has released its results for the first quarter of fiscal year 2026, spanning from April to June. The company has reported a profit of ₹144 crore for this quarter, which is approximately 22 percent higher than the ₹118 crore profit recorded in the same quarter last year. Despite this, the company's shares saw a decline of over 3 percent. The primary reason for this drop is the decline in the company's total income and the reduction in earnings from advertising and subscriptions.
Significant Decline in Total Income
In this quarter, Zee's total income stood at ₹1,849.8 crore, compared to ₹2,149.5 crore in the first quarter of the previous year. In the last quarter of the previous fiscal year, January-March 2025, the company earned ₹2,220.3 crore. Thus, the company's income has decreased on both a year-on-year and quarter-on-quarter basis.
IPL Impact on Advertising Revenue
The most significant decline in Zee's income was observed in advertising revenue. The company earned only ₹758.5 crore from advertising in this quarter. A year ago, this figure was ₹911.3 crore, indicating a decrease of approximately 16.7 percent. In the previous quarter, January-March 2025, this income was ₹837.5 crore, representing a quarter-on-quarter decline of 9.4 percent.
According to experts, IPL has had a direct impact on TV broadcasting. During IPL, advertisers shift their focus towards sports channels and digital platforms, increasing pressure on general entertainment channels.
Subscription Revenue Also Decreased
The company did not receive much relief from subscription revenue either. In this quarter, Zee earned ₹981.7 crore from subscriptions. A year ago, this figure was ₹987.2 crore, and in the previous quarter, it was ₹986.5 crore. This indicates that subscription revenue remained stable or slightly decreased.
Impact of FMCG Companies' Spending Cuts
The broadcasting industry is currently facing several challenges. While there has been a slight improvement in the sales of FMCG companies, they have reduced their advertising and promotional spending. This has had a direct impact on the income of broadcasting companies. In particular, these companies' share in the TV medium is decreasing, and they are rapidly shifting towards digital platforms.
Lack of Election Season Also Reduced Earnings
In the first quarter of last year, the country was in an election atmosphere, which resulted in good earnings for TV channels from election advertisements. This time, there was no such electoral impact, which weakened advertising revenue. A large portion of TV channels' income comes from election advertisements, especially for news channels. Such earnings were not possible in this quarter.
Subdued Market Reaction
Zee Entertainment's shares remained under pressure after the results were released. Investors had expected the company to present results with b earnings, but the decline in income dimmed the luster of the overall profit.
On Tuesday, Zee's share on the BSE closed with a decline of approximately 3.2 percent. There were fluctuations during the trading session, but it remained in the red until the end of the market.
Weaker Performance Than Market Expectations
Analysts had expected Zee's advertising revenue to be around ₹792.4 crore and subscription revenue to be ₹995.5 crore. However, the actual figures were lower than this, which weakened investor confidence and led to a decline in the share price.
