Truecaller lays off 15% workforce as India revenue drops 41% in weak quarter

Truecaller will cut approximately 70 jobs, representing around 15 per cent of its workforce, after reporting a difficult first quarter marked by steep revenue declines in India, weaker advertising income and broader pressure on its core business model.

The Sweden-based caller identification company announced the layoffs alongside its Q1 2026 earnings results, which showed net sales falling 27 per cent year-on-year to 362 million Swedish kronor, or roughly $39.34 million.

The sharpest decline came from India, Truecaller’s largest market, where revenue dropped 41 per cent compared with the same period last year.

The company blamed the weak performance on multiple factors, including the collapse of advertising spending from India’s real-money gaming sector, algorithm changes by a key advertising partner and reduced business activity in the Middle East due to regional conflict.

India slowdown hits Truecaller’s biggest revenue engine

India remains central to Truecaller’s business, making the sharp decline particularly significant for investors and employees alike.

Speaking during the company’s earnings call, chief executive Rishit Jhunjhunwala said comparisons with last year appeared especially weak because Q1 and Q2 of 2025 benefited heavily from advertising linked to India’s real-money gaming industry during the Indian Premier League season.

“The year-on-year comparison looks especially weak given that Q1 and Q2 last year included a large contribution coming from the real money gaming sector in India in connection with the IPL season that takes place around this time,” Jhunjhunwala said.

Last year, India banned several real-money gaming applications, including platforms such as Dream11 and MPL, which allowed users to play fantasy sports using money.

Industry estimates cited by TechCrunch valued India’s real-money gaming industry at around $23 billion before the restrictions.

The disappearance of those advertisers created a noticeable gap for digital advertising platforms dependent on gaming-sector spending during major sporting events.

Truecaller also cited weaker revenue from the Middle East amid ongoing regional instability.

Advertising business comes under pressure

The company’s advertising segment experienced some of the steepest declines during the quarter.

Key Q1 figures included:

• Net sales declined 27 per cent year-on-year
• India revenue dropped 41 per cent
• Advertising revenue fell 44 per cent
• Around 70 employees will be laid off
• Workforce reduction equals roughly 15 per cent of staff

Truecaller said the advertising weakness was partly linked to changes introduced by a programmatic advertising partner.

Although the company did not directly name the partner during earnings discussions, TechCrunch noted that analysts earlier this year had identified the partner as Google.

The development highlights the growing vulnerability facing digital platforms that rely heavily on advertising ecosystems controlled by large technology intermediaries.

Changes to algorithms, ad distribution systems or targeting rules can materially affect monetisation performance for dependent platforms.

Telecom competition is adding new pressure

The weak earnings also arrive at a time when Truecaller is facing structural pressure in India from telecom-led caller identification services.

TechCrunch reported last month that the company has been dealing with challenges linked to India’s Calling Name Presentation service, or CNAP, which is being backed by telecom operators as an alternative caller identification system.

The company also recorded a 5 per cent year-on-year decline in downloads last year, suggesting increasing competition and potential saturation in parts of its core user base.

For years, Truecaller benefited from strong network effects in markets such as India, where spam calls, unknown numbers and fraud risks drove widespread adoption of caller identification services.

However, the emergence of telecom-native solutions could gradually reduce dependence on standalone third-party apps.

Subscription growth offers limited relief

Despite the difficult quarter, the company reported a few positive indicators.

Truecaller crossed the milestone of 500 million active users globally during the quarter, reflecting the platform’s continued scale and reach.

The company also reported growth in subscription revenue, which increased 27 per cent year-on-year and accounted for 31 per cent of total net sales.

Truecaller has been attempting to diversify beyond advertising by expanding premium offerings, including features such as AI Assistant and Family Protection.

The shift reflects a broader strategy seen across consumer technology companies seeking to reduce dependence on volatile advertising revenue streams.

Still, subscription growth was not enough to offset the broader weakness in advertising and India-related revenue.

Investors remain cautious despite recovery signs

The difficult quarter has intensified pressure on Truecaller’s stock performance.

According to TechCrunch, the company’s shares have fallen more than 26 per cent this year and over 79 per cent during the past 12 months.

The stock showed some recovery following the earnings announcement, but investor sentiment remains closely tied to whether the company can stabilise its advertising business and defend its position in India.

The latest results also reflect a wider trend affecting many ad-dependent digital businesses globally.

Several technology companies are confronting slower advertising growth, changing platform algorithms, rising competition and shifting user behaviour at the same time that investors are demanding stronger profitability and operational discipline.

For Truecaller, the challenge is becoming increasingly complex.

The company is trying to protect growth in its largest market while simultaneously reshaping its revenue mix away from advertising dependence.

At the same time, it must respond to changing telecom infrastructure, evolving regulation and increasing competition in caller identification services.

The layoffs suggest management is now preparing for a more demanding operating environment where scale alone may no longer guarantee growth.