One 97 Communications Limited (Paytm) has reported a significant turnaround in its financial performance for the first quarter, marking a milestone in the company's journey towards profitability.

Key Financial Highlights

• Revenue Growth: Paytm's operating revenue grew by 28% year-over-year to ₹1,918.00 crore, driven by an increase in merchant subscriptions, higher Gross Merchandise Value (GMV), and growth in financial services distribution.

• Profitability Achievement: The company reported a Profit After Tax (PAT) of ₹123.00 crore, a substantial improvement from the ₹840.00 crore loss in the same quarter last year.

• EBITDA Performance: Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) turned positive at ₹72.00 crore, with a margin of 4%.

• Contribution Profit: Paytm's contribution profit rose by 52% year-over-year to ₹1,151.00 crore, with the contribution margin expanding to 60%, up 10 percentage points from the previous year.

Operational Metrics

• Merchant Base Expansion: Paytm's subscription merchants, including those using Paytm devices, reached an all-time high of 1.30 crore, reflecting a growth of 21 lakh year-over-year.

• GMV Growth: The company's Gross Merchandise Value (GMV) increased by 27% year-over-year to ₹5.39 lakh crore.

• User Engagement: Monthly Transacting Users (MTU) averaged 7.4 crore for the quarter.

Segment Performance

Payment Services

Revenue from payment services, including other operating revenue, grew by 23% year-over-year to ₹1,110.00 crore. Net payment revenue saw a 38% year-over-year increase to ₹529.00 crore.

Financial Services Distribution

This segment witnessed a remarkable 100% year-over-year growth, with revenue reaching ₹561.00 crore.

Marketing Services

Revenue from marketing services stood at ₹247.00 crore.

Strategic Developments

Paytm's board meeting also saw several key decisions and appointments:

• Board Changes: Ms. Urvashi Sahai was appointed as an Additional Director in the capacity of Whole-time Director for a five-year term, subject to shareholder approval.

• Executive Movements: Mr. Madhur Deora, currently serving as Executive Director, President & Group CFO, will not seek re-appointment at the upcoming Annual General Meeting (AGM) but will continue in his role as President and Group CFO.

• Independent Director Resignation: Mr. Bimal Julka resigned as an Independent Director to pursue interests in emerging technologies.

• New Project Approval: The board approved an ₹800.00 crore Engineering, Procurement, and Construction (EPC) contract with Manorview Developers Private Limited, a subsidiary of Adani Infrastructure & Developers Private Limited, for developing an IT/ITES complex in Noida.

• Auditor Appointment: M/s Chandrasekaran Associates was appointed as Secretarial Auditors for a five-year term.

Vijay Shekhar Sharma, Chairman, Managing Director, and CEO of Paytm, commented on the results, stating, "Our focus on innovation and AI-driven efficiencies has led to this significant turnaround. We're committed to maintaining this momentum and creating long-term value for our shareholders."

As Paytm continues to solidify its position in India's digital payment and financial services landscape, the company's achievement of profitability marks a crucial milestone in its growth trajectory. The focus now shifts to sustaining this performance and capitalizing on the expanding opportunities in the fintech sector.

One 97 Communications Limited (Paytm), India's leading digital payments and financial services company, has reported strong financial results for the first quarter, marking a significant turnaround with its first-ever profitable quarter.

Key Financial Highlights

• Revenue Growth: Paytm's operating revenue grew by 28% year-over-year to ₹1,918.00 crore, driven by an increase in merchant subscriptions, higher Gross Merchandise Value (GMV), and growth in financial services distribution.

• Profitability Achievement: The company reported a Profit After Tax (PAT) of ₹123.00 crore, a substantial improvement from the ₹840.00 crore loss in the same quarter last year.

• EBITDA Performance: Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) turned positive at ₹72.00 crore, with a margin of 4%.

• Contribution Profit: Contribution profit increased by 52% YoY to ₹1,151.00 crore, with a contribution margin of 60%, up 10 percentage points YoY.

Business Performance

Merchant Subscriptions and GMV

Financial Services

Distribution of financial services revenue doubled YoY to ₹561.00 crore, driven by expansion in merchant loans and improved asset quality.

Strategic Developments

Paytm continues to strengthen its leadership in India's merchant payment ecosystem, focusing on both enterprise and MSME segments. The company is leveraging AI capabilities to enhance product development, risk management, and customer experience.

Vijay Shekhar Sharma, Chairman, Managing Director, and CEO of Paytm, stated, "Our first quarter results demonstrate the strength of our business model and our ability to deliver robust growth while achieving profitability. We remain committed to innovation and expanding our merchant network, particularly in tier-2 and tier-3 cities."

Outlook

Paytm expects to maintain its growth trajectory and further improve profitability. The company anticipates its contribution margin to be in the mid to high 50s percent for the year and projects EBITDA before ESOP cost to continue growing.

Recent Corporate Actions

In a separate announcement, Paytm's Nomination and Remuneration Committee approved the grant of 93,244 stock options to eligible employees under its ESOP 2019 scheme. The exercise price for these options is set at ₹9.00 per stock option.

As Paytm continues to solidify its position in India's digital finance landscape, the company's focus on AI-driven innovations and expanding its merchant ecosystem is expected to drive future growth and profitability.