Paytm, a payments and financial services distribution company, announced on Friday that its financial results for the first quarter of fiscal year 2024-25 (Q1 FY25) saw a jump in merchant sign-ups on the platform similar to the levels seen in January.
The company highlighted that daily merchant payment GMV (excluding disrupted products) has steadily improved throughout the quarter, nearly returning to January 2024 levels. Additionally, it indicated a rise in new merchant registrations, with the merchant subscriber base now at 1.09 crore, reflecting an increase.
Paytm founder and chief executive Vijay Shekhar Sharma emphasised that his teams are working towards ensuring profitability. Sharma added that his company’s quarterly performance is in line with expectations, showcasing the strong resilience of Paytm’s platform.
“This is just the beginning of the end of the tough times, and this quarter reflects the full impact of the challenges we faced. As a team, we are committed to navigating through these times with a focus on compliance. My team and I are committed to ensuring we return to profitable quarters," Sharma said addressing analysts on Friday.
The company witnessed the full financial impact of recent disruptions in this quarter and stated that revenue and profitability will improve in the coming months with – growth in merchant payment operating metrics, gross merchandise value (GMV), accelerated merchant reactivation, and continued focus on cost optimisation.
“Our quarterly performance has been in line with our expectations, demonstrating the resilience and capability of Paytm's products and services,” Sharma added.
Further, as part of its earnings, the company added that its monthly transacting users (MTUs) have stabilised to approximately 7.8 crore at the end of June, with GMV increasing month-on-month.
The company is currently focused on cross-selling various financial products to its customer base and increasing its average revenue per customer (ARPU).
“We are fortunate to have a resilient customer base. We need to focus on cross-selling various financial services to both consumers and merchants. Our Average Revenue Per User (ARPU) remains stable, and we expect it to increase in the coming quarters,” Sharma added.
The fintech giant’s revenue from financial services amounted to Rs 280 Crore, while revenue from marketing services was Rs 321 Crore. The company's contribution profit for the quarter stood at Rs 755 Crore, with a 50 per cent margin.
The company reported a strong cash balance of Rs 8,108 Crore as of June 2024 and also holds stock acquisition rights in PayPay Corporation (5.4 per cent stake, once exercised).
Paytm said it looks to expand its loan business by cross-selling and integrating more types of loans from partners, including secured credit like ‘loan against property’ and ‘gold loans’.
Furthermore, it said the distribution of insurance, mutual funds, and stock trading platforms presents significant monetisation opportunities for the company.