1. Opening Hook
Just when everyone declared “AI will fix everything,” Newgen’s large license deals decided to take a long chai break. Q3 FY26 arrived with solid subscriptions, decent margins, and an existential crisis around enterprise decision-making. Management insists the pipeline is strong, customers are interested, and deals are almost done—just stuck in AI-induced overthinking mode.
Revenues grew, but without fireworks. Margins held up, thanks to AI doing the grunt work humans used to do. India and Middle East stayed moody, while the U.S. behaved like the responsible adult in the room.
If you’re looking for drama, don’t worry—license recovery, AI confusion, and deferred decisions make multiple appearances later.
Read on. It gets more interesting, and slightly uncomfortable.
2. At a Glance
- Revenue ₹400 cr (+5% YoY) – Growth showed up, but didn’t bring enthusiasm.
- 9M Revenue ₹1,122 cr (+7% YoY) – Momentum, just not the kind markets clap for.
- Annuity ₹250 cr (+20% YoY) – The dependable friend who always pays on time.
- Subscription ₹134 cr (+29% YoY) – SaaS doing SaaS things, quietly winning.
- PAT ₹90 cr (22.5% margin) – Margins stayed fit while growth skipped leg day.
- One-time labor code hit ₹35 cr – Policy reminder that surprises still exist.
3. Management’s Key Commentary
“Q3 was a quarter of balanced performance in a
selective market.”
(Translation: Nobody wanted to sign big cheques 😏)
“We onboarded 34 new logos in 9 months.”
(Lots of first dates, fewer weddings.)
“License recovery is expected in coming quarters.”
(Trust us, it’s in the pipeline. Somewhere.)
“Annuity revenues grew 20% YoY.”
(Subscriptions saving everyone’s bonus.)
“AI is increasingly embedded in our deals.”
(Every pitch deck now has at least 12 AI slides.)
“Margins held due to productivity and AI-led engineering.”
(Fewer people, more prompts.)
“Large enterprise deals face elongated decision cycles.”
(Boards discovered ‘wait and watch’ mode.)
4. Numbers Decoded
| Metric | Q3 FY26 | YoY | What It Really Means |
|---|---|---|---|
| Revenue | ₹400 cr | +5% | Growth, but cautiously polite |
| Annuity | ₹250 cr | +20% | Sticky, predictable, loved |
| Subscription | ₹134 cr | +29% | SaaS clearly not the problem |
| PAT (adj.) | ₹90 cr | — | AI helped margins behave |
| DSO | 125 days | — | Cash still jogging, not sprinting |
Below the table:
License volatility remains the spoiler; annuity keeps the story investable.
5. Analyst Questions
- Why weak India &
