ShareChat has been dedicated to serving India’s vernacular internet audience for approximately 11 years. Although often viewed as a potential competitor to Meta in India, it has yet to significantly challenge the dominance of this social media powerhouse. As ShareChat seeks to innovate with new formats and has recently ventured into the microdrama niche to align with current trends, the journey towards profitability remains a significant challenge. This article analyses the annual results for FY26.
Revenue Growth in FY26
After two years of modest growth during FY24 and FY25, ShareChat’s operational revenue surged by 40.5%, reaching Rs 1,016 crore in FY26, compared to Rs 723 crore in FY25. The parent company, Mohalla Tech, manages a vernacular social media and digital entertainment enterprise encompassing platforms like ShareChat, Moj, and QuickTV, aimed at regional-language users in India.
Key Revenue Contributions
The revenue generated from ShareChat’s chatroom feature, enabling users to engage through video calls, accounted for 46% of the overall operational revenue. This category experienced an 8.8% growth, reaching Rs 471 crore in FY26. Conversely, advertising revenue saw a decline of 13%, dropping to Rs 252 crore during the fiscal year.
In addition, QuickTV brought in Rs 293 crore in subscription revenue in FY26. Different from advertising revenue, subscription income is recognised over the duration of the subscription. The organisation also reported an additional Rs 89 crore from reversing provisions for doubtful assets, bringing total income to Rs 1,105 crore.
Increased Business Development Expenses
With efforts to advance its new business segments, expenses for business development skyrocketed by 8.7 times, amounting to Rs 335 crore in FY26, in contrast to Rs 43 crore in FY25. Following a series of layoffs over the previous year, employee benefit costs decreased by 16%, now standing at Rs 220 crore. It is important to note that ESOP expenses of Rs 739 crore in FY26 and Rs 184 crore in FY25 have been excluded from this comparison, as these are classified as non-cash expenditures.
The company incurred Rs 549 crore in interest expenses related to borrowings through debt securities. Rising costs from servers, content development, legal matters, and other overheads led to an overall expense increase of 14.6%, totalling Rs 1,777 crore in FY26 compared to Rs 1,550 crore in FY25.
Profitability Challenges
While QuickTV has introduced a new source of revenue, it has yet to result in substantial improvements in profitability. Mohalla Tech’s net loss was reduced by 15.58%, coming in at Rs 672 crore in FY26, down from Rs 796 crore in FY25. All calculations of overall losses have included ESOP expenses and unrealised foreign exchange losses to accurately depict the company’s financial situation.
Per unit, Mohalla Tech spent Rs 1.75 to generate each rupee of operational revenue in FY26, and its EBITDA margin was recorded at -84%. Despite the considerable combined user base of over 300 million for ShareChat and Moj, QuickTV has the potential to become a significant asset if managed correctly. However, the dip in advertising revenue prompts concerns about whether brands can find relevant audiences on its platforms or if they are diverting their focus elsewhere.
Even the chatroom segment, the highest revenue generator, is growing at a moderate rate. The forthcoming years will be crucial for Mohalla Tech as it endeavours to create new revenue avenues, optimise its existing user base, and most importantly, strive towards achieving profitability.