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Nazara Technologies Ltd
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Ladies and gentlemen, good day, and welcome to the Nazara Technologies Q3 9 Months FY '23 Earnings Conference Call hosted by Elara Securities Private Limited. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Karan Taurani. Thank you, and over to you, sir.
Thank you, Mike. Hi, everyone. Good morning, and welcome to this call of Nazara Technologies Q3 FY '23 and 9-month results con call.
Please join me in welcoming the management of Nazara Technologies, which is represented by Mr. Nitish Mittersain, who is the Managing Director; Mr. Sudhir Kamath, who is the Chief Operating Officer; Mr. Rakesh Shah, Group Chief Financial Officer; and Ms. Anupriya Sinha Das, who is the Head of Corporate Development.
I would now like to hand over the call to Mr. Nitish for his opening comments. Over to you, sir. Thank you.
Good morning, everyone, and a very warm welcome to all of you to Nazara Technologies Q3 and 9 month FY '23 Earnings Call.
I would like to start by wishing all of you a very happy New Year and a fantastic '23 ahead. I have with me Sudhir Kamath, our Chief Operating Officer; Rakesh Shah, our Chief Financial Officer; Anupriya Das, our Head of Corporate Development; and [indiscernible] Uploaded are results presentation on the exchanges, and I hope everyone has had the opportunity to go through the same.
Coming straight to our financial performance [indiscernible] of INR 8,017 million in 9 months FY '23, which is up 80% year-on-year. Our EBITDA came in at INR 820 million for the 9 months and a PAT of INR 558 million, which is up 22% year-on-year.
For Q3 FY '23, we generated revenue of INR 3,148 million, up 69% year-on-year. Our EBITDA came in at INR 306 million and the PAT of 224 million, which is up 31% year-on-year. This performance is in line with our stated goal of driving fast growth through reinvestments into the businesses while maintaining healthy profitability and positive cash flows.
As we anticipated earlier and also mentioned in the last earnings call, it is heartening to see that our flagship product for young children, Kiddopia, came back on a growth path. Kiddopia subscribers grew by 3.7% in this quarter, while revenue grew by 21% aided by the price hike we had taken in the earlier quarter.
We also undertook another price hike in this quarter on December 1, and we have not seen any material negative impact in our core KPIs that we track. And this makes us confident that the benefits of this action will accrue to us in the coming quarters.
I also want to highlight that our recent acquisition of DataWorks in the ad tech space is performing well and has seen its revenues increase by 55% year-on-year from -- sorry, to INR 1,182 million for the first 9 months of FY '23. Our businesses in Nodwin, Sportskeeda, NextWave and OpenPlay continue to perform well. And we are working closely with the WildWorks team to ensure that they get on to a fast growth track at the earliest.
A lot of the work we do with these businesses is instilling the Nazara DNA in each of them. This includes focus on profitability, our long-term mindset and enhanced governance. As long as we continue to drive these aspects, I fully believe each of these businesses will continue to drive long-term compounding of value for us.
We have also made several key hires across our business over the last few months as we see the present market downturn as a good opportunity to attract good talent for ourselves. We have recently created a special projects team that will work closely to analyze and execute new opportunities that we want to pursue, including new tech trends such as Web 3 and generative AI with an intent to use them to our advantage across our businesses.
We also continue to evaluate various M&A opportunities across the 5 verticals we operate in, and we will not hesitate to make fresh investments if opportunities fit our value creation framework. I look forward to the continued support of all our stakeholders as we continue to pursue our long-standing commitment of Nazara playing a significant role in India's journey towards becoming a global gaming powerhouse.
Now I will request Anupriya to talk about each of the businesses in detail. And thereafter, we will be happy to answer all your questions in detail as well. Over to you, Anupriya.
Thank you, Nitish. Good morning, everyone. In terms of our segment performance, eSports contributed to 49% of revenue, while gamified, early learning and ad tech contributed to 24% and 14% of revenue, respectively. Freemium and skill-based real money gaming contributed to 2% and 5%, respectively, in 9 months of FY '23.
Now moving to eSports. For our eSports vertical, which consists of Nodwin, Sportskeeda and Publish Me, our revenue grew by 84% for 9 months FY '23 and 40% for Q3 FY '23. During the same period, Nodwin revenue grew by 98% in 9 months FY '23 and 53% year-on-year growth in Q3 FY '23. Nodwin witnessed growth in revenues led by off-line events such as Dreamhack and NH7 weekender as well as creation of new international IPs.
EBITDA margins in Nodwin were lower due to significant investment made in creating these new IPs as well as negligible margin contribution by the gaming accessories business that is still in high growth sales. Benefits of operating leverage will kick in as we scale revenue. Our own IPs and media rights revenue to stream -- to show nonlinear EBITDA growth as IP scale.
Also, the B2C business will become even more margin accretive once brands are well-established. Revenue growth of 59% in 9 month FY '23 compared to 9 month FY '22, owing to strong growth in revenue from the U.S. market, where both Sportskeeda and its video business and [indiscernible] offering in core American sports like basketball, American football
[Audio Gap]
Hello, Ms. Anupriya, can you hear us?
Hello?
Yes, we can hear you now.
Yes. Was I not audible in the Internet?
Yes, ma'am.
Okay. Should I...
Anupriya, just continue.
8% growth in December 2022 versus December '21. We also saw a significant increase, which from 2 minutes, 48 seconds in Q3 FY '22 to 5 minutes, 3 seconds in Q3 FY '23. Gamified early learnings, this vertical consists of Paper Boat and WildWorks.
As Nitish mentioned, we are very excited to report that Kiddopia is back on the growth track, both in terms of subscriber growth and revenues. Subscriber growth for the quarter has been 3.7%. The increased marketing spend to $3.4 million in Q3 -- in FY '23, while maintaining CPT of $37 per user through time optimization for the user acquisition spend.
Kiddopia has also seen another price hike in the beginning of December, and we will not see any of 4 key mixes [indiscernible] in Q3.
Sorry to interrupt, ma'am, your voice is breaking in between. The words are not clear. If you could speak there, repeat the sentence once again.
Sure. Kiddopia has taken another price hike in the beginning of December, and we have not seen any of our metrics regress. In fact, churn has declined from 6.5% in Q2 to 5.9% in Q3.
Our revenue growth for Q3 FY '23 has been 21% year-on-year. Like Nitish mentioned, WildWorks is a work in progress. We have reported revenues of INR 298 million with EBITDA of around $19 million in 9 months FY '23.
We are working on optimizing user spend across channels and working on product level updates to drive higher engagement and monetization. Moving to ad tech. The ad tech revenue grew by 55% year-on-year in 9 months FY '23. 31 new clients were added in 9-month period, contributing 31% of total revenue during the same time. I now move to the freemium segment. The revenue grew by 38% in 9 months FY '23 over 9 month FY '22, driven by 48% growth in ad revenues and 14% growth in revenues.
EBITDA margin increased to 29.9% in 9 months FY '23 on account of revenue growth as operating expenses remained constant. We are in the process of ramping up the core team in NextWave to help drive the next stage of growth for our business.
Moving to the skill-based real money gaming asset called OpenPlay. Revenue growth of 28% in 9-month FY '23 as OpenPlay works on optimization of products. We also know that the new proposed IT rules, which are the first steps towards clearer regulation of this sector. As part of the public consultation, we have shared our feedback on some aspects that need further clarity. But overall, this is a great step.
Moving to the telcos. For 9-month FY '20, the revenue has declined by 16%, while EBITDA grew by 2%. We have been able to continue optimizing cost in this segment to drive higher EBITDA.
I will close my remarks here, and we'd like to open the call for Q&A and request Nitish, Sudhir and Rakesh Shah to join me for the Q&A.
[Operator Instructions] We have the first question from the line of Rahul Jain from Dolat Capital.
[indiscernible]
Rahul, your voice is not very clear. If you'll go off the speaker phone once. Okay, Mr. Rahul has left the queue. [Operator Instructions] We have the next question from the line of Abhishek Kumar from JM Financial.
Good to see growth back in Kiddopia. The first question I have is on Kiddopia. First, it looks like the growth has come at the expense of margin, which is not bad. But I just wanted to understand, we have been taking price hikes for the last couple of years. However, the blended ARPU seems to be quite stable. So I just wanted to understand what is driving this? And second, are we now comfortable with this kind of CAC, which seems to have stabilized. And therefore, we can push for more user acquisition through higher marketing spend.
Abhishek, this is Nitish. I will answer both your questions. So I think if you see the ARPU, right, the most recent prices have and then -- the last quarter and starting of December. What is to understand is that the price hikes impact only new users that we acquire and not existing subscriber base.
So you will see a trend up of ARPUs over a period of time, which you're actually seeing. If I look at Q3 FY '21, we were at $6.3 average monthly ARPU, now increase to $6.8 on an average in Q3 of FY '23. We're seeing a gradual increase. And I think the back-to-back price increases that we've done in the last few months is probably show a faster increase in ARPUs in the coming year. I think that's 1 point.
I think on the CAC side, we are quite comfortable with the current range of CAC, especially adjusted for the price hikes that we have done. If you also see our CAC was $39.3 in Q1 of FY '23 on a spend of $2.7 million. We increased our spend to $3.1 million in Q2, and the CAC actually came down to $37.9.
And in the current quarter, the CAC was down to $37.3 on an increased spend of $3.4 million. So I think both these trends are very positive, right? We're increasing our marketing spend quarter-on-quarter and at the same time, being able to optimize our CAC, which will also lead to margin expansion.
So I think overall, we are quite satisfied with the way things are playing out for Kiddopia and are very hopeful that this growth will pick up pace in the coming quarters.
Great. So just to clarify before I move on to my next question, should we build in the same level of marketing spend going forward every quarter? Or would you increase or decrease it as we go along?
We would like to increase it provided we are within our card bills of CAC. So I think if the opportunity does arise, and we are to efficiently spend the money to acquire users, we will surely increase it.
Great. Now my next question is on eSports. So sequentially, the growth was not very strong, given Q3 is traditionally a seasonally strong quarter. And my understanding, if you can correct me if I'm wrong, is because last quarter was seasonally strong for the accessory business.
So given that accessory business is not very margin accretive, there should be a strong margin expansion, which has not come through. So if you can just explain me why the margins have still not gone up? And when can we expect margins to go back to historical levels of 6% to 7% in this business?
So I think there are multiple things happening here at Nodwin, which is kind of suppressing the margins in the interim period. One is even in this Q3 quarter, we've seen revenues come from the gaming accessories business as well as some of the new IP that we've launched, such as Playground, which remain today margin neutral, I would say. So there's a significant growth come from those areas, which have not contributed to margins.
Now the other aspect is really speaking, many of the real old events are also coming back after a long time. And they will take I think a few quarters to get back completely up to speed in terms of efficiencies. We have introduced new games in these events because of some of the games that kind of [ banned ] earlier in the year. We focused on new games and new development of IPs around that. So I think that has also kind of hurt the margins a bit.
Our focus on Nodwin right now is to develop multiple businesses around that, putting the gamer in the center and make sure that we were able to go through that business and kind of cater to his needs on a 360-degree basis. So from our overall Nazara portfolio perspective, the way we are looking at Nodwin is to continue to drive market leadership in the key areas that they are operating in, while many of our other businesses right now focus on contributing to margins. So I don't have immediate visibility on when margins on Nodwin are going to really come back to where they were enhanced. So I would not like to give any guidance.
The last point here is also for addressing a lot of these areas that Nodwin gotten to. Nodwin has been hiring some senior teams and key hires over there, which have also kind of added the costs on the team side. So I would think of these as medium- to long-term investments, and we are very happy to support this business to continue to grow strategically for us.
We have the next question from the line of Jinesh Joshi from Prabhudas Lilladher.
Sir, I have a question eSports. I think recently, the government of India recognized eSports as a part of a multisport event. So basically, what is the implication here? I mean will there be any budgeted support from the government to train the players? Or is this move basically just to [indiscernible] that more people take up professional gaming as a career option?
Jinesh, so I think any step taken by the government to recognize eSports is a highly positive step for us, right? I think the multisport recognition is just one step towards what we would really like to see eSports recognized as a stand-alone sport on its own feet.
And I think we will get this sooner or later. And this is a good step towards that. I think just categorizing and calling eSports as part of a sport, right, allows a whole ecosystem to build around it, which includes professional athletes, better training, serious participation in global events, which then would lead to increase in fan base in India. Which would mean increase in viewership, potentially helping us on media rights, et cetera. So I think it's a whole ecosystem building. And this is certainly a step in the right direction, but not -- but there's a lot more we want to happen.
Sure, sir. Sir, my second question is on OpenPlay. If I look at that, we have declined from [ 27,000-odd ] in September to approximately 23,000 [indiscernible] in December. And this is despite the fact that Google has now allowed Rummy App to be listed on Play Store. So is there any specific reason for this decline, which you would want to highlight?
I think our focus has been on kind of OpenPlay, on deep diving on our value with customers and really enhancing their ARPUs and setting our systems and our processes and our funnels right. So that as we scale our user base, we are very efficient in our operations. The update on the Google Play really is it's a work in progress. We've launched our Google Play app.
However, there was a lot of friction on the KYC process, which means there's still some enhancements being done there for us to really gain benefit of it. Early signs are very positive. We think that the quality of customers we are getting from Google Play, the ARPUs are much better. We are recovering kind of 20% of our first time depositor cost on Google Play app versus we normally may recover 10% in the first month when it's on Google Play. So we are very positive about this, but this hasn't gone mainstream for us. We are hoping that maybe by next quarter, we will really be able to scale up the Google Play opportunity and start showing better results from then.
Sure, sir. One last question, if I may. Can you give us some color on how WildWorks has been doing, especially in terms of API because I think it had a subscriber base of about [indiscernible] with an ARPU of about $18.5. So has there been any improvement here like we have done for Kiddopia and any specific numbers you would like to give on marketing spring here as well?
In WildWorks, I would say it's completely a work in progress right now. We are trying to bring a lot of the learnings of Nazara to WildWorks, we are working very closely with the team. The first thing we did was bringing someone senior in the data analytics team. There were a lot of fixing to be done in terms of how we are capturing the data, a lot of the data that we were capturing earlier was not accurate.
So I think they have been kind of fixing the hygiene over there while also creating a strong product road map that we feel will be valuable to the end consumer. And lastly, we are also evaluating pricing strategy over there because WildWorks has not increased prices for a really long time and we see a low-hanging opportunity there.
So all in all, I would say there's still a lot of work going on and, therefore, a lot of the data points that we have or that we have shared in the past also and not with the right reference point. I think we are hopeful that by next quarter, we will be able to show more accurate data over here as well as positive momentum and traction.
Overall, this quarter, contribution in revenues have been strong for us, and we've seen good growth. But underlying, we see a lot of opportunities where we can work on and improve. We continue to be very excited about this opportunity with Animal Jam being a fantastic IP. And we're very hopeful that FY '24, we will really see Animal Jam, WildWorks perform very well for us.
We have the next question from the line of Rahul Jain from Dolat Capital.
Yes. Sorry, I break out earlier. Firstly, on the Kiddopia side of the business. Since now, the [indiscernible] declining rather despite the price hike and CAC is also getting optimized. Now what kind of growth one should see in the subscriber? What kind of anticipation one should build going into this calendar or next fiscal? Any input on that would be helpful.
Yes. So it's a bit early for us to make a forward guidance on that because this is the first quarter where we kind of come back on growth. But like you rightly said, all the parameters are indicating a lot of potential declining cost of per trial, increasing ARPUs and reducing churn, right? The team has also done a lot of work on the product side. So I think it's not just a pricing strategy, but also the efforts that in the last year, we have put in on the product that has started for some benefits.
So I think right now, the guidance for the team is let's not be in a large hurry to spike spend. Let's just keep doing what we're doing with our batteries on. As long as we are acquiring quality users at the right price that we are willing to pay, we can surely increase the amount of money that we are spending, which as you can see also in the last 3 quarters, every quarter, we've gone from $2.7 million to $3.1 million to $3.4 million in this quarter. You've seen about a 10% increase in spend every quarter, and we will try and continue to do that.
Right. And -- on the profitability side, some of this investment in the Nodwin and also the mix change that has happened. You said difficult to gauge how these things will keep moving.
In that light, will it be a better idea to share the Nodwin core business margin separately to understand how that business is shaping up? And either identifying the revenue and margin for OML, WINGS, Playground as a separate data. Probably, that could give us a better idea. And also, any change in seasonality of this business that you foresee now given that offline is also on and now some of these businesses may not be as seasonal. So what should be the -- how we should see the seasonality here in Nodwin?
Sure. So I think 2 things, like the business mix of what Nodwin right now is changing very rapidly quarter-on-quarter because there have been multiple new businesses and new business lines that have been introduced. We would like to see it stabilize before we start carving out and sharing individual line items.
But surely, in the coming quarters, we will intend to do that. In terms of [ seasonality ], I think it's broadly the same H2 will always be more than the H1 in terms of revenues. Although there will be some balancing because of the game accessories business, which has Q2 as the largest driver of revenues. So I think it will normalize to a certain extent. But this October, the Q3 and Q4 is the time when most of the physical events also take place because of the better weather, et cetera, in the country. So I think broadly, the seasonality will still continue.
Right, right. And [ Animal Jam ] I'm sorry you missed your comments. So when we see this margin and growth coming back into this business, the way we would like it to?
Like I said earlier, we are very actively working with the team on multiple fronts. And I think I would give it 1 or 2 quarters to stabilize before we have very clear visibility on growth.
But the more we work on this product to the more we see low-hanging opportunities for ourselves. So we remain convinced that this is -- this was a great IP to buy, and there's a lot that we'll be able to do here. Hopefully, by next quarter, I will give more visibility on more specifics around that.
So you're saying for 1 or 2 quarters, probably the margin would be low and growth would be stable? And then probably some of the action that we are taking would fructify over the coming period?
Yes, because we want to make sure that we get the hygiene right, right? We have full grip on data. We have the right customer acquisition channels. Now we have completely given user acquisition of Animal Jam to DataWorks, which is an internal team now starting to work very actively on.
So I think the whole idea is before we start really scaling this business, we want to make sure we have a complete grip on all the levers of the business, and then we would like to do that. So I think by next quarter, we should be able to, at least, be very comfortable ourselves that we have all levers in place. We kind of addressed all the low-hanging opportunities.
And then once we are satisfied with the potential LTV, lifetime value and the cost of customer acquisition across multiple channels, we will start scaling this business up.
Sure. That's very helpful. Lastly, if I can just squeeze in one, which is on the ad tech side of the business. Here, we are seeing consistent growth but margin is coming off. Is it because of some pricing pressure given the matters we are in?
No, we've not seen pricing pressure, but I think a lot of new customers have been added as new customers scale, where we see overall better margins. So I don't think it's much to do with pricing pressure. The company has grown fast introductory, we do better pricing for customers until it goes up in scale. So I think that's what's being demonstrated on the margins.
So 8% to 10% is the range that we should keep in our mind for this business?
At this point of time, yes. I think there will be many ways for us to optimize and increase its margins. We will focus on this in the coming year.
Okay. Okay. I think you've done exceptionally well on the gamified business side and the metrics are very encouraging. I hope you have a very great year forward.
We have the next question from the line of Mukul Garg from Motilal Oswal Financial Services.
I hope my audio is clear. A very broad-based growth and a good job this quarter. Had a couple of good questions. First, a bit following up on Ravi's comment on Nodwin. Is it possible to kind of give a sense of what was the full growth in Q3? Historically, is the strongest quarter. But this time, [indiscernible] in Q2, you had accessory seasonality, which kind of played out while Q3 and multiple other offline events also started.
So how should we look at seasonality? Q4 has been the low season because of exams and other kind of issues, which kind of acted with headwind. Has that been going away now and will it be more broad-based?
Sorry, your last sentence kind of [indiscernible] Up. Can you just repeat that, Mukul?
So with the kind of performance in the Nodwin business being more broad-based than Q3, heavy kind of a kind of impact given the multiple events, which will be there across that year in the offline model.
Yes. I think more or less, yes, I would say, Q4, for example, with more events will also do better. Q1, Q2, we'll also see better. So I think overall, like I was saying earlier as well, we will see more normalization across quarters. We still think, at least, into FY '24 to be a larger share, but the percentage may drop vis-a-vis H1 and in a sense, may normalize a bit.
The mix is rapidly evolving. We think events will continue to grow especially now with -- as you were discussing earlier, that better recognition of eSports, you will see much more audience coming in, much more players coming in. So I think, overall, we are very positive on physical events online events, media rights as well as the other businesses that Nodwin has got into.
Holistically, I think this business should continue to grow into FY '24. At the right time, we will, Mukul, also focus on margins. It's not that we don't want to make margins on this business. And we will keep a strong eye over there and see whatever we can do, but at the right time.
Completely agree with you. Just a second part on sort of the recognition angle. As far as, obviously, there has been a low here in the industry due to the kind of mixing up of RMG with eSports. How receptive is government to kind of look at them separately and not do a mandatory, your registration or validation of the users?
I think we are, obviously, engaging with the government and the entire industries is engaging with the government. I think a lot of the regulation right now is focused on where money in, money out is involved, right? And it specially focuses in that activity or the regulatory activity on the skill-based RMG side.
And I think that's really the key focus. I think some better definition comes out in the regulation once it's out, will be good. But I don't see eSports or our premium business or other businesses impacted by this regulation. I don't think they are the target at all.
Okay. So you expect kind of the regulation side will also want to come out a bit different from the current flooding?
Yes. I mean they put out for public opinion feedback, including the industry. And I'm sure they're incorporating reviewing all suggestions and believe the final guidelines will address concerns that have been raised.
Sure. One question on Kiddopia, how should we see that flow through the price hike and the new users kind of coming into revenues? Will the average pass-through happen over a 6-month period or will it be a longer impact as to previous pricing kind of mixed [indiscernible] revenues?
Yes, I think as you are seeing quarter-on-quarter, there has been an increase in [indiscernible]. I think over the next couple of quarters, at least, you will continue to see that because we've increased -- we took on price hike in the previous quarter and 1 price hike in this quarter. So I think we've made some good a 30% increase over there, which is only going to play out.
Has new subscribers come in at higher price? This also -- therefore we, for example, aggressively scale up our marketing spend and, let's say, increase our data marketing spend. The ARPU will also rise faster because the mix of the old users or these new users will change. But I think trend-wise, we are absolutely in the right direction in Kiddopia.
Sorry, if I may take 1 last question on the premium side that discussion happens on that. Your BAUs and MAUs has been clearly stable there now. I know the dynamics are not extremely favorable in that space, but you have been able to maintain a very high profitability there. Why not over that, that is to [indiscernible] to drive top line growth given the pace that is the industry is growing?
Yes, we have. Mukul, making many changes and enhancements in that product right now. And you're absolutely right, in the coming months, we are very keen to increase our marketing spend and scale up the user base there. There are a lot of new updates that are going to be coming out after that.
We are already starting to actually experiment with advertising. Again, we have DataWorks set up a focus team to help us achieve that. And so one of our targets is to see how we can really scale [ WCC ] to the next level and not remain kind of plateaued as it has been in the past.
We have the next question from the line of Deep Shah from B&K Securities.
Nitish, if you could just explain or rather kind of highlight some of the events which you plan to do in this year. So I see a slide in your presentation, but what are the gains that we're looking to target and scale up, given that I don't think BGMI is coming back and then soon. So when was that? Which day in India are we going to now target? Or are we looking to stay them up or create IPs? And are we looking at the international events because some games have a large international audience. Also, can we do that in the eSports segment? That is my first question.
Sorry, your last line broke up. Can you just repeat that?
No, I'm saying that, say, games like BGMI where we have a good hold, they have a massive international audience also. So are we looking to host these events outside India? Any plans on that if we could just share.
Yes. So 2 things. I think one is on what games are we focusing right now on. New State has been 1 team that has been well. Valorant, I think there's a big opportunity and Nodwin team is doing a lot around that. Interestingly enough, even in Dreamhack, we saw a lot of success with online shares.
So we're also looking at that opportunity. So I think we have many games that we can kind of play with. On the global opportunity, we are evaluating and also trying to work with publishers to do international events with them on a larger scale and perhaps those events would be also broadcast in India. So I think that's the line we are trying to kind of take on the games that are not very active in India today.
But if I can just ask a follow-up here. So we've kind of been organizing international events already maybe not stand-alone, but in partnership with others. So is that the right assessment or we were just -- or we've not had international events done? I mean, what has been international presence in organizing IPs?
No. We have always been active in doing international events outside of India as well. And we did, for example, even the PUBG event for South Asia in Q3 of FY '23. So it's not something new that we are going to do. We have always been active on it. We are doing it as we speak.
And we supported Tencent in Dubai for PUBG. So I think there is a lot of activity there and a lot of growth opportunity for us there.
Right. Nitish, secondly, on this real money gaming space. So yes, I completely buy your point that there is a lot of flux right now. But given that how polarizer space has become, where do you find our sweet spot is because ticket is completely dominated by 1 large player and then I can give it right to enter in other sports also. What is that sweet spot that we are looking in, say, Rummy or create a platform? So what is kind of the growth type scenario there?
Yes. So I think, obviously, today's Classic Rummy business that we have under OpenPlay, right? It's approximately INR 5 crores a month business, which from our R&D scale is extremely small. What we are really focusing on is building a very powerful platform.
We brought in a new CEO in that business in the last quarter, who has also come in and worked a lot on the tools and the data that we are operating with really kind of enhancing the funnel that we operate in. So I think we have 2 thoughts here.
One is how can we accelerate the growth of the business, the existing business by being more efficient by being able to target users better, by being able to generate higher by taking advantage of the Google Play opportunity that is presented in front of us, et cetera. There are many things we can do to kind of accelerate this core business.
But at the same time, everything that we are doing to accelerate this core business, can that also become launch pad for many other games that we can drive alongside. So that's one thing. That's an organic part of the RMG growth. The second is, I think as -- over the next few months as more regulatory clarity emerges as well as taxation clarity emerges. We will not shy away from consolidating other games and other players on this open play platform. Because I think in this case, liquidity sharing, et cetera, could be very powerful. Cost efficiencies will be there.
And we could actually create 1 plus 1 equal to 3. So I think scaling up RNG is very much on our mind as the regulatory clarity is coming up. And we will see how we evolve this into FY '24. In the meantime, organic growth is the strong forces for us.
We have the next question from the line of [ Nitin Jain ] from [ Fare ] Investments Private Limited.
Yes. So first of all, congratulations on the execution. My first question is on the overall business. So since the IPO of the company has maintained that it would be prioritizing growth over margins, but also make sure that the growth is profitable. But if you look at the consolidated numbers this quarter and strip out the other income. We have actually made a loss at the PBT level.
So my question is like going forward, how far would we be comfortable allowing the margins to dip to achieve growth? And my next 2 questions are on the gamified learning business. So the pleasant surprise this quarter has been the growth in the Kiddopia business and assuming that the decline in Kiddopia subscriber base has bottomed out now.
Does your revenue guidance for the year include a growth in the subscriber base? And regarding WildWorks, can you talk a little about the unit economics of WildWorks business and whether we see any opportunity for price hikes here as well.
I'll answer all 3 questions for you. The first one, I'm not sure I grasped properly because our EBITDA was INR 30.6 crores at the consolidated level is not included in EBITDA. So I'm not sure whether I misunderstood your question.
I'll just answer the other 2 also and then we can come back to the first, if you wish. The second one in terms of Kiddopia. Yes, absolutely, we've grown 3.7% on a subscriber base this quarter, after many quarters of kind of flatting out in some couple of quarters of drifting. So I think we are very excited about seeing the growth coming back.
Given all the units are trending positively, we have encouraged the team to scale latter spends and grow the subscriber base. So we should continue to see subscriber base growth I won't be able to kind of put specific numbers there right now because it's the first quarter of growth. And we need to see how this is trending over the next quarter or 2.
In terms of WildWorks unit economics. Like I said previously, there's a lot of work in progress, a lot of different things happening and a lot of moving parts. So I think it's a bit premature to get into a lot of specific unit economic survival. But at the right time, once things are stable, we will start presenting almost exactly the same KPIs and unit metrics that we provide for Kiddopia, given that both businesses are very similar.
Lastly, I very much think that there is a lot of potential to increase pricing in WildWorks. It's been untouched for maybe the last 2, 3 years, and there are many different ways to do it, and it's all work in focus right now.
So just to clarify my first question. So while we have been flat at the EBITDA level, so at the PBT level, if I strip out the other income on its own, the business has like made a loss this quarter. So because of the significant margin decline. So if you can just clarify that, please?
Just open that page, one second. So our finance that -- look, I think there are 2 things here. One is on the EBITDA level, we are flat. That I think is okay for us. We've done INR 306 million or INR 30.6 crores EBITDA consolidated versus INR 30.3 crores EBITDA at the previous quarter year-on-year.
Our thinking, seems as long as we are going in the right strategic direction, while maintaining profitability and cash flows, we are okay with it. I think one thing is on the back, you must realize that we take a fairly large amortization of the acquisitions that we have done, which are noncash amortization. So I think from a PBT perspective, that kind of colors it a bit. But even then, I'm seeing on my numbers, I'm seeing a PBT of $285 million or INR 28.5 crores, other income of INR 11.5 crores. It is still positive. So I'm not still very clear why you're seeing the loss.
We have the next question from the line of Ankit from JM Financial.
Congratulations on a great set of numbers. We have couple of questions. First one, on the unique major count in the R&G segment for this quarter that I mean, you tend to -- so last quarter, it was around INR 27.7k. I think this quarter do not disclose that in the presentation.
Sorry, your question is why the unique in consumer...
[indiscernible]?
Why that has declined?
So [indiscernible]...
I'm not getting your question.
Ankit, we can't hear you very well. If you could kindly go off the speaker phone and repeat your entire question.
Looking to that, I mean, if you can just give the number of average for the recent quarter that ended. Last quarter was 27.7.
It's already in the presentation of 23,690.
And then second question on the ad tech front. So ad tech is usually -- this business is seasonal. Third quarter, it seems to be a seasonal quarter for all the businesses. So do you -- in the fourth quarter, I mean, would that growth remain there? Or what is the growth that you are targeting?
So I think you're right, October, December because our ad tech business focused in the U.S. and the October to December runs up into Christmas, right? So brands are spending the most regarding this and then they drop off the spend in the first quarter of the year -- or of Q4 for us, the spend definitely drop off.
So there is seasonality that builds up in Q3 and then normalizes in Q4. And you will see the same thing happen this year as well. But on an overall basis, we will continue to see a good growth year-on-year on this business.
We have the next question from the line of Pranav from Dolat Capital.
Am I audible? Yes, just a quick question on Sportskeeda. So I think the revenue update for Sportskeeda could have been better given the seasonality. And even the margin profile when we compare on a Y-on-Y basis, they have declined a bit. So can you just give a sense of how you're seeing Sportskeeda? Any takeaways were specific to this Q3 quarter?
Yes. No, I think we continue to see good growth overall on Sportskeeda and we're satisfied with that. The margins are, I think we've also opened a new sports [indiscernible] we have kind of built teams on some new areas that we are investing in. So I think some of the margins are -- potentially would be slightly lower because of new investments that we are making in teams and content, et cetera.
If you see our growth in terms of the average MAU, right, that has also steadily increased. Even in this quarter, it's $76.9 million, up from $72.8 million. So I think overall, it's an early business. We continue to be very happy with it. And we continue to invest in new areas within that to see how we can drive growth for FY '24.
This is a Sudhir, here, Nitish, can I just add a bit here?
Please.
So I just want to make a point that on Sportskeeda, we also had a change in the management this quarter. As you know, with or stepping out and Ajay and the CEO of stepping up. And with that, there's also been a lot of new ideas and new directions in which we can grow this business. And therefore, there's a bit of investment, which goes along with that. And that's reflecting already in terms of the MAUs and so on. But over time, I think it will start showing the margins as well. So just wanted to add that point.
That was the last question. I would now like to hand it over to the management for closing comments.
Thank you, everyone, for all the questions today and for listening in. We look forward to continuing with our work and coming back to you in the coming quarter with good numbers and all the strategy for FY '24. Thank you, again.
Thank you. On behalf of Elara Securities Private Limited, that concludes the conference call. Thank you for joining us, and you may now disconnect your lines.