SaaS firm Capillary Technologies reports 22% fall in profit in Q3 FY26; revenue jumps 16% to Rs 184 crore

Capillary Technologies India Limited, an AI-powered, cloud-native SaaS provider focused on loyalty, CRM and customer engagement solutions for large enterprises, reported steady revenue growth in the third quarter and nine months ended December 31, 2025, even as quarterly profit declined due to higher depreciation, amortisation and one-time costs.

For Q3 FY2026, the company’s operating revenue increased 16% year-on-year to Rs 184.04 crore from Rs 159 crore in the corresponding quarter last year.

Including other income of Rs 3.68 crore, total income for the quarter stood at Rs 187.72 crore. The revenue growth reflected continued expansion within the existing customer base, addition of new enterprise customers and ongoing contribution from acquired businesses, including Kognitiv.

Net profit for the quarter declined about 22% year-on-year to Rs 7.99 crore from Rs 10.26 crore. The decline was driven by higher depreciation and amortisation expenses of Rs 19.08 crore for the quarter, along with one-time costs. These included IPO-related expenses of Rs 1.98 crore and an expense impact of Rs 1.61 crore related to the Direct Labour Code. On a sequential basis, profit improved sharply from Rs 0.29 crore reported in Q2 FY26.

Total expenses for the quarter rose 17% year-on-year to Rs 159.06 crore. Employee benefit expenses increased 22% to Rs 89.95 crore, continuing to remain the company’s largest cost component. Software and server charges stood at Rs 32.63 crore during the quarter.

For the nine months ended December 31, 2025, Capillary reported operating revenue of Rs 543.25 crore, up 22% from Rs 446.18 crore in the same period last year. Profit after tax for the nine-month period rose sharply to Rs 9.02 crore, compared with Rs 1.14 crore a year earlier, supported by revenue growth and operating scale, despite the impact of one-time expenses during the period.

Founded in 2008, Capillary serves more than 390 brands across 46 countries. The company listed on Indian stock exchanges in November 2025. Its shares opened at Rs 560 on the BSE, a discount of about 3% to the issue price of Rs 577, while the stock debuted at Rs 571.9 on the NSE.