Route Mobile reported Q3 FY26 performance marked by a strategic business mix transformation, moving away from low-margin International Long Distance (ILD) traffic towards higher-margin domestic and regional business. Despite a 6.5% YoY decline in revenue to ₹1071 million, the company achieved a standout gross profit margin expansion to 24.5% (a 340 bps improvement YoY). The quarter also saw the announcement of Rajdipkumar Gupta transitioning from CEO to a strategic role, with Tushar Agnihotri taking over as CEO effective February 9th, 2026.
Leadership Transition and Strategic Vision
The company announced a significant leadership evolution: Mr. Rajdipkumar Gupta is transitioning from MD and CEO to focus on the strategic direction of the business in collaboration with the Proximus Group. Mr. Tushar Agnihotri, with over 30 years of experience and joining Route Mobile in 2016, has assumed the role of CEO effective February 9th, 2026. Mr. Gupta confirmed that Route Mobile will remain a listed company, refuting any delisting rumors.
Q3 FY26 Financial Performance
The focus for the quarter was resilience amid business mix transformation. Key figures for Q3 ending December 31, 2025, include:
- Revenue from Operations: ₹1071 million INR, lower by 6.5% YoY and 1.1% sequentially, primarily due to lower volumes in low-margin ILD business.
- Gross Profit: Grew by 8.6% YoY to ₹2712 million INR.
- Gross Profit Margin: Expanded significantly to 24.5% (a 340 bps improvement YoY), marking one of the highest quarterly performances.
- Adjusted EBITDA: Increased by 3.5% YoY to ₹1429 million, with an Adjusted EBITDA margin of 12.9% (120 bps higher YoY).
- Adjusted Profit After Tax (PAT): Increased by 20% YoY to ₹1026 million, maintaining steady bottom-line profitability.
Business Mix Transformation Drivers
The primary driver for margin improvement was the strategic shift away from volume-driven, low-margin ILD revenue towards higher-margin domestic (India) and regional business. This revenue shift was partially offset by growth in non-SMS products, including a 14.5% YoY revenue growth from new products in the nine months ending December 31, 2025.
Management highlighted that while absolute gross profit grew, EBITDA expansion was moderated by increased operating expenses supporting product development, go-to-market initiatives, and salary increments essential for retaining talent. The company remains focused on securing large, sustainable enterprise and telco deals, prioritizing EBIT margin growth over volume dilution.
New Products and Partnerships
The company is seeing increasing adoption of its omni-channel solutions, including RCS messaging and WhatsApp Business API integration, which command premium pricing. New partnerships expanded in Q3, including those with Infosys and Tech Mahindra. Regarding the Proximus relationship, 14% of total revenue is currently coming from this partnership, driven by wins like the Claro deal in Latin America, which utilizes the BICS network access for firewall solutions.
Q&A Insights on ILD and Competition
During the Q&A, management noted that while India’s ILD market share remains strong (top two players), the decline is due to a channel shift among large enterprises exploring OTT options like RCS and WhatsApp. The company stated it is actively supporting these shifts by enabling these new channels via its platform. The company expects the Vodafone/VI deal, if renewed, to be structured as two separate agreements (Firewall and SMS) to prevent margin dilution.
Source: BSE
