One97 Communications, which operates the Indian payments platform Paytm, narrowed its losses by 6.3% year-on-year to Rs 208 crore ($24.03 million) for the quarter ended December 2024 (Q3 FY 2025) as expenses fell.
The company had posted a loss of Rs 222 crore ($25.6 million) in the year-ago quarter and a profit of Rs 930 crore in Q2 FY 2025.
In line with the growing trend of Indian startups focusing on profitability, Paytm curtailed its direct and indirect expenses in the quarter.
Indirect expenses—marketing, employee expenses excluding ESOPs, software, cloud & data centres—dropped 23% to Rs 1,000 crore in Q3 FY25 from Rs 1,301 crore in the same quarter a year earlier. The company also managed to curtail direct expenses by 35% YoY to Rs 869 crore during the three-month period.
Paytm’s expenses shrink
GMV grew 13.6% to Rs 5 lakh crore in Q3 FY25 from Rs 4.4 lakh crore in the same period in the previous year. Merchant subscriptions were also higher at Rs 1.17 crore in Q3 FY25, up by 10% from Rs 1.06 crore in Q3 FY24.
The firm’s revenue from operations also fell 36% to Rs 1,828 crore ($211.2 million) in the quarter from Rs 2,850 crore ($329.3 million) in Q3 FY24 despite a rise in GMV.
Paytm’s revenue and loss
The company earns majorly from payment services, financial services, and marketing services and the revenue generated from all these revenue streams declined YoY basis in Q3 FY25 compared to Q3 FY24.
Payment services was the highest revenue source generating Rs 1003 crore in the quarter and accounting for more than half of the total revenue generated from operations. Financial services generated Rs 502 crore contributing around 27.5% of the total revenue.
The company’s revenue from operations, however, increased 10% sequentially in Q3 FY25 compared to the previous quarter. Revenue generated from all the streams—payment services, financial services, marketing services and others jumped on a sequential basis helped by an increase in GMV, subscription revenues, strong growth in merchant loans, and better collection efficiencies.
The firm reported a negative EBITDA of Rs 223 crore in Q3 FY25 improving by Rs 181 crore QoQ basis from the previous quarter in the same financial year, on account of lower ESOP costs.
The cash balance of the company also increased to Rs 12,850 crore on a QoQ basis in Q3 FY25, up by 11.9% from the previous quarter, mainly due to PayPay stake sale and improvement in working capital.
