PayTM Net Loss Skyrockets To Rs 839 Cr Amid Ongoing Regulatory Scrutiny

According to Reuters, Paytm reported its biggest quarterly loss since going public, driven by regulatory actions that forced the wind down of its banking unit. The digital payments firm's net loss for the quarter ending June 30 soared to Rs 839 crore, up from Rs 357 crore a year earlier.

In May, Paytm had warned that the full impact of the Reserve Bank of India's clampdown would be felt in this quarter. As a result, revenue from operations fell 36 per cent  to Rs 1,502 crore, with payments business revenue, which accounts for 69 per cent of the total, dropping by 39 per cent.

EBITDA before the cost of employee stock options was a negative Rs 545 crore, compared to the company's earlier estimate of a negative Rs 500 crore-Rs 600 crore.

The company has reported an operating revenue of Rs 1,502 Cr, with Earnings before Interest, Tax, Depreciation, and Amortisation (EBITDA) loss standing at Rs 792 crore. EBITDA before ESOP stood at loss of Rs 545 crore.

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

Revenue from financial services amounted to Rs 280 crore, while revenue from marketing services was Rs 321 crore. During the quarter, contribution profit was at Rs 755 crore, with a 50 per cent margin.

Paytm spokesperson said, “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."

The company 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).  

Despite these setbacks, Paytm remains optimistic about improving revenue and profitability from the second quarter.