Subex lifts operating margin to 20.75% as revenue grows 7.73% QoQ
Expenses grew 5.24%, slower than revenue, but a higher 16.04% tax rate kept net profit nearly flat.
Filed 03 Nov 2026, 20:09 IST · after market close · Subex Ltd (SUBEXLTD)
Key takeaways
- Consolidated revenue grew +7.73% QoQ while expenses grew +5.24%, lifting operating margin by 1.87 percentage points to 20.75%.
- Net profit rose just +0.49% QoQ as the tax rate increased by 2.43 percentage points to 16.04%, despite operating profit growing +18.40%.
- Subex's 20.75% operating margin was 1.29 percentage points above the 19.46% median for 50 reported IT peers.
Price around the results
Revenue growth outpaced costs in Q2FY27
On a consolidated basis, revenue rose +7.73% QoQ to Rs 85.59 cr, while expenses increased +5.24% to Rs 67.83 cr. That operating leverage lifted operating profit by +18.40% to Rs 17.76 cr and expanded operating margin by 1.87 percentage points to 20.75%. The results were filed after market close on 3 Nov 2026.
Higher tax rate limited profit conversion
Net profit increased only +0.49% QoQ to Rs 14.29 cr, even as operating profit grew +18.40%. The tax rate rose by 2.43 percentage points to 16.04%, while other income fell -44.99% to Rs 2.58 cr. Other income still accounted for 15.16% of pre-tax profit, so reported profit included a meaningful non-operating contribution.
Margin was above the reported IT-peer median
Subex's 20.75% operating margin was 1.29 percentage points above the 19.46% median among 50 Information Technology peers that had reported the same quarter. With only Q1FY27 in the supplied trend, the quarter shows sequential margin improvement rather than a multi-quarter direction. Management said Subex secured new Partner Ecosystem Management business with operators in APAC and Europe, a Phase 2 order from a Tier 1 Middle Eastern operator, and a Fraud Management deployment for two African operating companies; it also said the company is upskilling talent in an AI-led software development lifecycle.
Q2FY27 at a glance
Consolidated figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q2FY27 | Q1FY27 | QoQ |
|---|---|---|---|
| Revenue | ₹86 cr | ₹79 cr | +7.73% |
| Other income | ₹3 cr | ₹5 cr | -44.99% |
| Expenses | ₹68 cr | ₹64 cr | +5.24% |
| Operating profit | ₹18 cr | ₹15 cr | +18.40% |
| Operating margin (%) | 20.75% | 18.88% | — |
| Interest | ₹1 cr | ₹1 cr | -6.35% |
| Depreciation | ₹3 cr | ₹3 cr | +5.00% |
| Profit before tax | ₹17 cr | ₹16 cr | +3.40% |
| Tax | ₹3 cr | ₹2 cr | +21.87% |
| Net profit | ₹14 cr | ₹14 cr | +0.49% |
| EPS (₹) | ₹0.26 | ₹0.26 | +0.00% |
Operating margin of 20.75% compares with a Information Technology sector median of 19.46% across 50 peers that have reported Q2FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- Subex secured a new European customer for Partner Ecosystem Management during Q2 FY27.
New orders
- Subex secured a new Partner Ecosystem Management deal with an APAC operator.
- Subex won a new African group account to deploy Fraud Management at two operating companies.
- Subex received a Phase 2 Partner Ecosystem Management order from a Tier 1 Middle Eastern operator.
New initiatives
- Subex is upskilling talent in an AI-led software development lifecycle to improve engineering productivity.
What to watch
- Whether operating margin holds above 20.75%.
- Whether the tax rate moves below 16.04%.
- Whether other income remains a material share of pre-tax profit versus 15.16%.