ZEEL leans on streaming, cost cuts for growth; Punit Goenka sees momentum even as ads dip
Zee Entertainment posted a 22% profit rise in Q1 FY26 despite a sharp ad revenue slump, as Punit Goenka bets on streaming growth and cost discipline to drive the company’s next phase.
ADVERTISEMENT
Punit Goenka, CEO of Zee Entertainment, is seeing early signs of momentum as the media company battles a challenging advertising market while ramping up investments in content and technology. “Over the last couple of quarters, the team has put in significant efforts to enhance our content offerings in every market. I am pleased to share that we are beginning to witness a positive momentum in this direction with our linear viewership share touching 16.8% in quarter one, further fortifying our position as a strong player in the industry,” Goenka said. “In fact, during the month of June itself, we have clocked-in a viewership share of 17.8%, which is nearly a two-year high.”
Zee Entertainment reported a 21.7% increase in profit for the first quarter of fiscal 2026, even as its advertising revenue fell sharply in a tough macro environment for India’s media sector. Net profit rose to Rs 143.7 crore in Q1 FY26 from Rs 118 crore in the same period last year, with EBITDA at Rs 228 crore, the company said in a filing to the BSE.
Total income for the quarter fell 14% year-on-year to Rs 1,849.8 crore, while advertising revenue dropped nearly 17% year-on-year to Rs 758.5 crore. Domestic advertising revenue declined by 19%, as an extended sports calendar and a slowdown in FMCG spending weighed on the company’s core revenue stream. Subscription revenue dipped marginally from Rs 987 crore to Rs 982 crore, as growth in digital subscriptions was offset by a decline in PayTV subscribers.
“With an aim to offer more meaningful entertainment experiences to our viewers, we are creating new, high-potential avenues in the realm of content and technology,” Goenka said.
The company, which has been focusing on financial discipline to navigate the shifting market, reported a sharp drop in expenses, which fell to Rs 1,652 crore in Q1 FY26 from Rs 1,941 crore in the same period last year. Advertisement and publicity spending fell to Rs 275 crore from Rs 289 crore, helping Zee protect margins as it continued to invest in content.
“The fiscal prudence exercised, not just in the digital business, but across the Company is auguring well for us, and our energies remain directed towards achieving the enhanced levels of profitability,” Goenka said. “I firmly believe that we have stepped into the new fiscal with determination and action-oriented steps. As our efforts continue to showcase the desired results, we remain confident of building a robust growth trajectory centered around content, technology and financial discipline.”
Mukund Galgali, Deputy CEO and CFO, emphasized Zee’s continued position in the traditional TV space while highlighting its streaming and music business performance. “On the linear business front, we continue to be India's strong number 2 TV entertainment network,” Galgali said.
Streaming platform ZEE5 reported 30% year-on-year revenue growth to Rs 290 crore in Q1 FY26, while narrowing its EBITDA loss to Rs 65 crore from Rs 75.3 crore a year earlier. “ZEE5 continues to demonstrate steady growth with healthy and stable usage and engagement metrics. ZEE5 revenues increased by 30% YoY in Q1 FY26 aided by digital syndication revenue and revised pricing strategy in language packs driving subscriber growth,” Galgali said.
“We have reduced EBITDA losses by Rs 1,119 Mn YoY in Q1 FY26, aligned with our stated objective to achieve breakeven in ZEE5,” he added.
Zee’s music business continues to add to its profitability as it diversifies into regional markets. “Within the music business, our profitability continues to remain fairly healthy and we are further diversifying our catalogue into other language markets,” Galgali said.
“PAT from continued operations for the quarter came in at Rs 1,437 Mn, up 14% YoY,” Galgali noted. “Accelerating growth, profitability and cash generation continue to remain our priority, and this will further be driven by the new initiatives we are working on.” Zee’s bet on disciplined cost management and targeted investments in digital and technology-led growth could define its next phase, even as near-term ad headwinds persist.
