Zee profit drops 38% on FIFA costs

Zee Entertainment Enterprises posted a sharp decline in earnings on Friday.

The Indian broadcaster’s consolidated profit fell to 478 million rupees, roughly $5 million, for the period ending in September. That figure represents a 38% drop compared to the 765 million rupees reported in the same period a year ago.

Executives attributed the lower bottom line to increased spending on the FIFA World Cup broadcast. The company stated that programming and advertising costs rose to support the event, expand its content library, and fund other strategic initiatives.

Total expenses increased by 16% during the quarter. This spending push compressed core profit margins to 3.2%, down from 7.4% in the prior year. Advertising revenue, a primary revenue stream for traditional broadcasters, remained flat. Zee noted that the upcoming festive season could help stimulate ad sales.

Subscription revenue grew by 30%, driven by FIFA coverage and a robust pipeline of new content. Total income for the quarter rose 12.6%. The company has been diversifying its portfolio by investing in streaming services, sports broadcasting, and vertical-video micro-dramas.

Analysts at Elara Capital warned in a pre-earnings note that higher advertising and promotion spending would likely pressure Zee’s core margins. They also noted that the traditional television business faces ongoing challenges as advertisers shift budgets toward digital platforms.