Paytm Q1 FY 2025 reports operating revenue of Rs 1,502 Cr, merchant payment metrics rebound, consumer metrics stable

New Delhi [India], July 19 (ANI): One 97 Communications Limited (OCL) which owns the brand Paytm, announced financial results for the first quarter of financial year 2025.

The company reported an operating revenue of Rs 1,502 Cr, with Earnings before Interest, Tax, Depreciation, and Amortisation (EBITDA) loss standing at Rs 792 Cr.

EBITDA before ESOP stood at a loss of Rs 545 Cr, as stated previously. The financial results of the company are in line with the guidance provided during the previous quarter.

The company also added that the full financial impact of the recent disruptions is visible in Q1 FY2025. The company stated that revenue and profitability will improve moving forward, with the growth in merchant payment operating metrics including GMV, accelerated merchant reactivation and growing merchant base, along with continued focus on cost optimisation.

The company reported revenue from financial services amounted to Rs 280 cr, while revenue from marketing services was Rs 321 Cr. During the quarter, contribution profit was at Rs 755 cr, with a 50 per cent margin.

“We are seeing a rebound in our merchant operating metrics and stability in our consumer base, demonstrating our path to recovery. This also indicates the continued confidence of our merchant partners and consumers on our platform, and we are grateful for the trust of our stakeholders. With Q1 illustrating the full impact of recent disruptions, we are confident in our trajectory towards sustained growth going forward” said a Paytm spokesperson.

The company also highlighted that it continues to have a strong balance sheet with Rs 8,108 Cr of cash on books. It also holds stock acquisition rights in PayPay Corporation (5.4 per cent stake, once exercised).

The company said that new merchant signups on its platform reached January 2024 levels. Further, accelerated efforts towards redeploying devices from inactive to new merchants have resulted in an increase in merchant subscriber (or device merchant) base to 1.09 Cr.

The Noida-headquartered payments major said that it expects net device merchant additions to reach previous run rates by Q3 FY 2025.

The daily average GMV (excluding disrupted products) has shown improvement during the quarter and the company added it will remain positive as it nears January 2024 levels. Overall the gross merchandise value (GMV) has been growing month-on-month (MoM) and is Rs 4.3 lakh crore for the June quarter.

The company highlighted that its total monthly transacting user base had stabilised at around 7.8 crore by the end of June, highlighting strong user affinity for Paytm’s platform and retention.

Paytm further added that it is awaiting permissions to onboard new UPI consumers, which will result in further growth of its MTU base.

As part of its earnings release, the company emphasised that it remains committed to managing its overall cost structure. The company has achieved 9 per cent reduction quarter on quarter in employee costs, as part of its goal to save Rs 400-500 cr annually.

Paytm has been keenly focused on distributing tailored offerings to its consumers across categories of loans, wealth products and insurance.

The company stated that it has seen a strong product-market fit for the distribution of its shop insurance offerings by leveraging merchant insights. On the consumer side, it has seen good traction with embedded and DIY insurance products such as motor insurance. On the health insurance front, it is offering differentiated products that combine Health Insurance, Health-care, and OPD benefits and has also launched protection plans for merchant partners. It will also look to enhance credit distribution by diversifying lending products and partners and expanding secured lending products.

The company also said that it will focus on leading the market with merchant payment innovations, including introducing new devices and aggregation of various merchant discount rate (MDR)-bearing payment instruments.

The company will allocate more resources to Insurance distribution and Mutual Fund distribution, which offer large monetisation opportunities.