Pine Labs reports a return to profitability in Q3 FY26, with revenue rising 24% and margins expanding, marking a strong post-IPO performance.
Pine Labs Returns to Profit in Q3 FY26
Fintech firm Pine Labs reported a profit in the third quarter of FY26, marking a sharp turnaround from a loss a year earlier. The company posted revenue of Rs 744 crore for the quarter, up 24% year-on-year.
Other income contributed Rs 36 crore, taking the total income for the quarter to Rs 780 crore. For the nine months ended December 2025, Pine Labs reported revenue of Rs 2,010 crore, reflecting 20% year-on-year growth.
Revenue Reporting Approach Sets Pine Labs Apart
Pine Labs clarified that it recognises revenue on a net basis. The company reports amounts retained after deducting payment processing fees and pass-through charges payable to banks and network partners.
It noted that some peers in the fintech space continue to report revenue on a gross basis. The clarification signals Pine Labs’ focus on transparency and conservative financial reporting as it adjusts to life as a listed entity.
Margins Expand on Business Mix and Cost Discipline
Profitability improved sharply during the quarter. Contribution margin rose 19% year-on-year to Rs 551 crore, supported by a higher share of margin-accretive businesses.
Adjusted EBITDA jumped 59% year-on-year to Rs 171 crore. EBITDA margins expanded to 23%, up from 18% in the same quarter last year. The company attributed the improvement to a better business mix and disciplined cost management.
Profit After Tax Turns Positive
Pine Labs reported a profit after tax of Rs 42 crore in Q3 FY26, compared with a loss of Rs 57 crore in Q3 FY25. This marks a year-on-year improvement of Rs 99 crore.
For the nine months, the company reported a net profit of Rs 53 crore, reinforcing the sustainability of its earnings recovery.
Employee Costs Remain the Largest Expense
On the cost side, employee benefits continued to be the largest expense, accounting for 37% of total costs. Employee expenses rose 5% year-on-year to Rs 263 crore during the quarter.
The relatively modest increase reflects controlled hiring and tighter cost oversight even as transaction volumes expanded.
Operating Cash Flow Impacted by Festive Volumes
Operating cash flow for the quarter stood at minus Rs 124 crore, excluding early settlements, and minus Rs 152 crore, including early settlements.
The company attributed the working capital outflow to higher transaction volumes during the festive period. Pine Labs said it expects this impact to normalise in the following quarter as settlement cycles stabilise.
Strong Quarter Follows Successful Market Debut
The financial results come in the same quarter as Pine Labs’ listing on Indian stock exchanges. The company made a positive debut, with shares listing at a 9.5% premium over the issue price.
The stock opened at Rs 242 per share against an IPO price of Rs 221 on both the NSE and BSE, reflecting investor confidence in the company’s growth and profitability trajectory.
RBI Approval Strengthens Ecosystem Play
Earlier this month, Pine Labs received Reserve Bank of India approval to fully acquire account aggregator Agya Technologies. The move increases Pine Labs’ stake to 100% and strengthens its position in the account aggregation ecosystem.
The acquisition aligns with the company’s broader strategy to deepen its fintech infrastructure capabilities while expanding regulated offerings.
A Post-IPO Inflection Point
Pine Labs’ Q3 performance signals a clear inflection point. Revenue growth, margin expansion, and a return to profitability position the company strongly as it navigates public markets.
With regulatory approvals in place and a focus on disciplined execution, Pine Labs enters its post-IPO phase with momentum firmly on its side.
Pine Labs CEO Amrish Rau
Photo: ISN
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