Quick Heal Technologies Limited (QUICKHEAL) Q4 2026 Earnings Call Transcript

Gentlemen, good day, and welcome to the Quick Heal Technologies Limited Q4 and FY26 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Hena Khatri from Valorum Advisors. Thank you.

Good afternoon, everyone, and a very warm welcome to you all. My name is Hena Khatri from Valorum Advisors, and we represent the investor relations of Quickfield Technologies Limited. On behalf of the company, I would like to thank you all for participating in the company's earnings call for the fourth quarter and financial year ended 2026. Before we begin, a quick cautionary statement. Some of the statements made in today's earnings conference call may be forward-looking in nature. Such forward-looking statements are subject to risk and uncertainties which could cause actual results to differ from those anticipated. Such statements are based on management beliefs as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's conference call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. Now, let me introduce you to the management participating with us in today's earnings call. We have with us Dr. Kailash Kartkar, Managing Director, Dr. Sanjay Kartkar, Joint Managing Director. Mr. Ankit Maheshwari, Chief Financial Officer, Deepak Jaa and Sneha Kartkar from the Strategy Office. Without any further delay, I would request Dr. Kailash Kartkar to start with his opening remarks. Thank you and over to you, sir.

Thank you, Hina. Good evening, everyone, and thank you for joining us. I know you guys are curious to understand what is happening. The answer is simple. We have been transforming. Transformation from B2C antivirus company to holistic cybersecurity company, serving consumers, enterprise, government, not like an English jargon, but transforming our product. Thank you. And now represent more than 50%, not by default, but by design. Why is this transformation required and how is it impacting us? We all know that globally, B2C antivirus industry is struggling due to the industry headings and the degrowth. Many of the oldest companies Just focus on consumer business has perished over the years. More so recently, due to the hardware price hike, we have witnessed sharp fluctuation in the business. We are one of the few companies globally who have vision and made the transformation a reality, and And thus are able to stay strong, but it demands patience. We have never shied away for it and have constantly invested in both R&D and sales and marketing along these many years. The degrowth in consumer business over the years has been compensated by the growth in the enterprise business. Best on the Progress VR team, we believe we should... To be able to navigate these challenges of business degrowth. The next three to four quarters with enterprise business contribution, a major share of our revenue. I have to pass on the confidence that Quikil will continue to hold leadership position in the consumer segment as well. I envision to move enterprise vertical to represent close to 80-90% of the top line in coming next 2-3 years, and I am bullish about the future, even though the quarter and yearly finance results are not very encouraging. With this, I would now like to hand it over to Sanjay for further business updates.

Thanks, Kailash, and very good evening to everyone. The cybersecurity landscape is undergoing rapid transformation driven by AI-led threats, increasing geopolitical tensions, evolving regulations, Get option, exit. They are no longer looking only for reactive security solutions. They are seeking predictive, intelligent, and proactive cybersecurity capabilities. The cybersecurity industry today is dominated by vendors from the US and Israel. However, with rising global polarization and cyber warfare increasingly becoming the first line of attack and defense, We foresee a significant market opportunity emerging for us as an Indian cyber security vendor. Throughout the year, we have clearly demonstrated our capability and thought leadership across multiple instances. During the multi-front digital assault under Operation Sindur, Sagittal Labs served as a critical defense center for India's digital infrastructure. Tracking and identifying over 650 coordinated cyber incidents, and including spear phishing, malware, and DDoS attacks linked to 35 state-backed and activist groups. Our research teams also uncovered high-impact transitional cyber espionage networks. As Kailash highlighted, we are no longer just an antivirus company. Today, we are a trusted cybersecurity expert. Solution spanning, endpoint security, AI-driven detection and response, data protection and privacy, threat management, zero-thrust security, mobility management, and specialized security services, all powered by Secrite Labs, the largest malware analysis facility in India. Last year, we also launched Digital Risk Protection Services and Ransomware Recovery as a Service. We began onboarding initial customers within just two to three months of launch, which reflects strong market acceptance and the growing relevance of these offerings. The DPDP Act, which is similar in spirit to the European GDPR framework, has opened a meaningful opportunity for us. We anticipate This shift several years ago and invested early in building in-house products to help customers address evolving regulatory and compliance requirements. I am happy to share that we have already onboarded several large BFSI customers and are working closely with them in their compliance journey. We are also witnessing strong customer interest and market pool. As the government defined compliance timeline approaches in May 2027, AI is now reshaping the cybersecurity landscape at an unprecedented pace. Attackers are increasingly using AI to discover vulnerabilities, automated exploit development, and scale attacks much faster than before. It significantly reduces the response window for defenders and makes speed, intelligence, and automation far more critical than ever. At Swigil and Secret, we are actively leveraging AI across threat detection, malware analysis, threat intelligence, and response automation to enhance protection at scale. We believe AI will not replace cybersecurity companies. It will clearly differentiate organizations that can adapt quickly from those that cannot. Our focus remains on ensuring that our technology, research, capabilities, and innovation stay ahead of this industry shift. With continued investment in AI-driven technologies, threat intelligence, data privacy, and scalable global capabilities, We believe we are well positioned for the next phase of cyber security growth and transformation. I would now like to hand over to Ankit for financial updates.

Thank you, Sanjay, and good evening, everyone. Let me now take you through the financial highlights for FY26. This has been a mixed year for us from a performance standpoint. While the enterprise business delivered consistent growth, The consumer business continues to fade, headwinds. Revenue for FY26 is... Compared to 280 crore in the previous year. Deferred revenue is set at Let me now discuss each vertical in detail. The enterprise vertical recorded consistent growth, supported by a healthy build-up in deferred revenue. We successfully executed the order. Received in February 2025, and secured an additional order relating to implementation of integrated cybersecurity solution worth 64 crores, which is reflected in our current order book. These further standards are confidence in the transformation to a holistic cyber security. We are largely driven by robust momentum in the government segment. While we continue to strengthen our government business and deepen penetration within private enterprises, we have also begun making strategic investments in Southeast Asia, Middle East, Africa, and Latin America to expand our market share as we saw initial successes in these territories. We are onboarding Marquee BFSA customers. Data privacy product last year, and this market opportunity has expanded meaningfully during the current year, with organizations increasingly prioritizing regulatory compliance initiatives. Persistent headwinds due to broader industry slowdown. In addition, the IT hardware market As our channel partners operate across both hardware and software, we will be able to Thank you. in our business wasn't further during the year. With a clear priority on bringing down the overdues. We welcome such cycles in the business together in the past. The cost of the year stood at negative 29 crore and was impacted by the decline in top line. At the same time, our overall cost was reduced. Supported by multiple cost optimization initiatives undertaken during the year. Prudent accounting practices. In the year incurred, pay for the year stood at negative 11 crores. And market expansion opportunities. As a result of our focused collection efforts, our overdue has improved significantly, which was 167 crores at the end of last year, has further went up to 176 crores at the end of last year. At the end of the year, and 249 crores as we speak. Foundation celebrated 10th anniversary setting a new benchmark of touching beyond.

Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and 1 on the touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants, you are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. A reminder to all, you may press star and one to ask a question. A reminder to all the participants, you may press star and 1 to ask a question. A reminder to all the participants, you may press star and 1 to ask a question. Participants, you may press star and 1 to ask a question. A reminder to all the participants, you may press star and 1 to ask a question. Participants, you may press start and want to ask a question. A reminder to all the participants, you may press star and 1 to ask a question. We have the first question from the line of Devang Shah from Ant Financial. Please go ahead.

Yeah, hi. Am I audible? Yes. Yeah, the question is, like, this was the worst quarter we have ever seen in the company. With the next few quarters also we are going to see some hiccups. I'm done. Like, the face is coming to the end on the knee attack.

Devan, thank you. In our commentary, you have clearly stated that this will be there for some more time, but this is a transitionary phase. We are getting ready for the future.

And so what are the plans for the AI adoptations? Yeah. Is there any plan like we are going to adopt the A&M? Or something like that for the expansion of the business or something?

So I'll say for us, like, AI is not a future roadmap. Like, it is already being integrated into multiple layers of our cybersecurity stack. We are using AI and machine learning across threat detection and normality. Malware classification or even response automation. So at the same time, we are also now adding AI capabilities into different cross-functions, not only I'll say product, but also our internal functions. So that is definitely helping us optimize cost and... Speed up our development. So cybersecurity, domain, etc. is where we are, like I will say, AI is being used like anything across. So our approach combines AI with deep threat research, telemetry, and human experts in security. I will say accuracy matters more. And that's where we have been using AI. And I am seeing in coming quarters, we will be seeing a lot of optimization on that front.

Okay, sir, and the last question from my side, just want to know, like, on the revenue front also, we are going to see the, like, drop over there, or the drop over on the revenue front would not be so much?

We will not be able to comment on this, but yes, our cost such as almost remains fixed, being 60% is the manpower cost and other cost is OPEX, which is almost fixed. So there will be some pain on revenue, especially in the consumer business.

Like the quarter was really very bad. So is there anything like the management has taken over like for the remuneration cut or something or did the percentage for the remuneration remain the same?

Same. So, this is the transitionary phase where we believe that we will come out from this comfortably. So, we are not taking any of those drastic steps, and as per the normal process, we are going at it.

Thank you. A reminder to all the participants, you may press star and 1 to ask a question. We have the next question from the line of Devanj from Quick Heal Technologies. Please go ahead. Devansh, you may proceed with your question, please.

Yeah, can you hear me?

Yes, sir.

I think that's a mistake. I'm not from Quikhil. I'm from Eternal Capital. The moderator might have written it incorrectly. Okay, so my first question was, I would just like to understand what are the top growth drivers that the management believes is going to take the company forward for the next, let's say, three to five years?

So, Devansh, as we said that Enterprise is the growth engine, and in that, especially the new products which we have launched last two years, which includes ADR, XDR, data privacy, which in my commentary also I spoke on that, that both the rules and regulations came in, that's another growth engine. Also, we have launched DRPS. So, these are the three or four growth engines. Apart from it, we have a Make in India story where we are looking at government business and international penetration as well.

Understood, sir. And just, what are you, like, what are the revenue scripts you're expecting from these particular segments? So, across, what are your targets internally?

So, we don't share these targets to the outside world, but in the commentary also, Kailash Katkar said that in the two to three year time frame, our revenue from enterprise will go up to 80 to 90 percent. And we will continue to remain our...

Got it, sir. And with this, all these data getting on the cloud, are you seeing any particular traction from that particular segment? So instead of hardware, a lot of this data is being stored on cloud.

Adoption is getting, is increasing year on year, and in fact, in our presentation also, we said that it is more than 30% now. So, cloud adoption is increasing.

Yeah, and this is also helping us with respect to the DP solution that we have actually, is data privacy solution, is also making right sense because we are, the data that is being Going outside the organization as well as scattered across the organization needs to be monitored and controlled. So that's, like I mean, say, cloud journey is like security plus data privacy is something that really helps us. And so for us as well, if you see our products, people, we used to have almost 20% of our... So, EPP and EDR solutions deployed on-premises, on cloud two years back, but now that has contributed 40%. So, cloud adoption in security solutions has also gone up.

Noted, sir. And just one last question. I just wanted to understand any sort of metric that you would like to give. Cloud adoption increases by 20% in FI27. What kind of metric are you looking at? If that industry gains 20%, what are you looking at? How would your line segment grow?

So, see, as we have been telling that we have increased on number of offerings, where when things like organizations going for cloud adoption, their attack surface increases. And that is where our newer services like DRPS, Digital Risk Protection, as well as cloud-related offerings like GTNA for accessing those cloud workloads. Really makes sense, and that's where these solutions will have more traction as the cloud adoption increases.

Okay, perfect. Thank you so much.

A reminder to all the participants, you may press star and 1 to ask a question.

Thank you very much.

Ladies and gentlemen, as far as no further questions from the participants, we now conclude the question and answer session. I now hand the conference back to the management for the closing comments. Thank you and over to you, sir.

Thank you. Thank you, everyone, for your time and continued support.

Thank you, members of the management. On behalf of Quikhill Technologies Limited, we conclude this conference. Thank you all for joining us, and you may now disconnect online. Thank you.