Paytm, the popular Indian digital payments platform, has reported a significant increase in net loss for the fourth quarter of the fiscal year. The company’s consolidated net loss widened to Rs 549.60 crore, citing disruptions in the Unified Payments Interface (UPI) transition and an embargo on its subsidiary, Paytm Payments Bank Limited (PPBL) products.
The revenue from operations also saw a 3% year-on-year decline to Rs 2,267.10 crore during the same period. Paytm attributed these challenges to the temporary and permanent disruptions caused by the UPI transition and the ongoing embargo on PPBL products, leading to the impairment of its investment in PPBL.
Founder and CEO Vijay Shekhar Sharma remains optimistic about the future, stating that the company has successfully transitioned its core payment business from PPBL to other partner banks. This transition aims to de-risk the business model and explore new opportunities for long-term monetization based on the platform’s strength in customer and merchant engagement.
Despite the challenges faced in Q4 FY2024, Paytm reported a contribution margin of 57%, which includes UPI incentives. The company also announced strategic measures to optimize its cost structure, leverage AI capabilities, and focus on its core business operations to achieve cost efficiencies.
Looking ahead, Paytm projects a revenue range of Rs 1,500-1,600 crore for Q1 FY2025, with an EBITDA before ESOP estimated to be between minus Rs 500-600 crore. The company anticipates a significant improvement from the second quarter of the fiscal year as it restarts paused products and aims for steady growth in operating metrics.
Overall, Paytm remains committed to navigating the challenges posed by the disruptions in the UPI transition and the PPBL embargo while focusing on driving growth and value for its stakeholders.
