What Caused Newgen Software’s Net Profit to Plunge 54% in Q1?
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Synopsis
Newgen Software faces a significant decline in Q1 FY26 with a 54% drop in net profit and a 25% decrease in revenue. This article delves into the reasons behind the downturn and future implications for the company, making it crucial for investors to stay informed.
Key Takeaways
- Net profit decreased by 54.11% in Q1 FY26.
- Revenue dropped by 25.4% compared to Q4 FY25.
- Total income stood at Rs 350.04 crore, down 21.16%.
- Investors reacted to the poor performance, impacting share price.
- NewgenONE aims to streamline business processes.
New Delhi, July 17 (NationPress) – The well-known Indian firm Newgen Software reported a significant decline in its quarterly performance for Q1 FY26, with net profit plummeting by 54.11% to Rs 49.72 crore, down from Rs 108.33 crore in the prior quarter (Q4 FY25).
Revenue from operations also saw a considerable drop, decreasing by 25.4% to Rs 320.65 crore compared to Rs 429.88 crore in the previous quarter, as revealed in its stock exchange filing.
The company’s total income for Q1 FY26 amounted to Rs 350.04 crore, reflecting a 21.16% decrease from Rs 444 crore in Q4 FY25.
In contrast, total expenses during this quarter slightly reduced to Rs 285.93 crore, marking a 5.55% decline from Rs 302.73 crore in the previous quarter.
In response to the disappointing quarterly results, investors reacted swiftly, leading to a decline in Newgen Software’s share price by Rs 64.30 or 5.89% to Rs 1,027.10 during the intra-day session.
Over the last month, the stock has faced significant pressure, dropping 7.87% in the last five days and 16.09% over the past month.
On a year-on-year (YoY) comparison, the company's performance exhibited only minor improvements.
Nevertheless, EBITDA decreased by 6% to Rs 45 crore, and EBITDA margins tightened to 14% from 15% in the prior year.
Newgen Software Technologies Limited is an Indian enterprise that provides a digital platform known as NewgenONE.
This innovative platform assists businesses in automating processes from start to finish, managing documents and communications, and leveraging advanced AI features.
It operates as a low-code platform, enabling companies to easily create and deploy applications on the cloud without extensive coding requirements.
The primary focus is on enhancing process efficiency, managing content proficiently, and improving customer engagement.
Point of View
Newgen Software's recent performance raises significant concerns about its operational strategies and market conditions. As a homegrown tech leader, its challenges reflect broader trends in the industry that warrant close attention. NationPress remains committed to providing insights that matter to our readers.
NationPress
17/07/2025
Frequently Asked Questions
What were Newgen Software's Q1 FY26 net profit figures?
Newgen Software reported a net profit of Rs 49.72 crore in Q1 FY26, a decrease of 54.11% from the previous quarter.
How much did the company's revenue decline in Q1 FY26?
Revenue from operations fell by 25.4% to Rs 320.65 crore compared to Rs 429.88 crore in the previous quarter.
What is NewgenONE?
NewgenONE is a digital platform by Newgen Software designed to help businesses automate their processes and manage documents effectively.
How did investors react to the quarterly performance?
Investors responded negatively, leading to a decline in share price by Rs 64.30 or 5.89% during the intra-day session.
What was the year-on-year performance comparison for Newgen?
On a YoY basis, revenue increased by 2%, and net profit rose by 4% compared to Q1 FY25.
