Paytm Q2: Revenues up 64%; losses widen to ₹473.5 crore

One97 Communications, the company that runs Paytm, has said its revenue from operations increased by 64% year-on-year on a consolidated basis to ₹1,086.4 crore in Q2FY22. The company has said that its revenues from payments and financial services grew by 69% y-o-y to ₹842.6 crore during the July-September quarter, while commerce and cloud services contributed a 47% y-o-y rise in revenues to ₹243.8 crore during the period.

The Noida-based fintech firm has attributed the surge in revenues from payments and financial services to a 52% growth in non-UPI payment volumes (GMV), and a 250% y-o-y growth in revenues recorded by the financial services and others segment during the July-September period. The share of financial services and others revenue increased from 3.8% of total revenue from operations in Q2FY21 to 8.2% in Q2FY22.

Total losses, however, widened to ₹473.5 crore in Q2FY22 from losses of ₹436.7 crore posted in the year-ago quarter, the company has said in its earnings statement released on Saturday. Paytm’s direct expenses shot up to ₹825.7 crore during the quarter from ₹626.3 crore in Q2FY21. The company, though, has claimed that its indirect expenses has reduced—from 70% of revenues in Q2FY21 to 63% of revenues in Q2FY22. Marketing and promotional expenses (excluding cashback and incentives) stood stagnant at ₹100 crore. Employee cost (excluding ESOP) reduced from 40% of revenues in Q2 FY21 to 34% in Q2FY22, on the back of continued investments in technology and merchant base expansion, the firm has said.

“Paytm has seen a strong second quarter of FY22, which is a testimony to the strong two-sided ecosystem of consumers and merchants that we have built. We have maintained the growth momentum in our payments services business, expanded our financial services business aggressively and are on our way to pre-Covid volumes for Commerce and Cloud services,” the company has said in a statement.

Led by active user engagement and adoption across businesses, the company’s GMV (gross merchandise value) for Q2FY22 stood at a robust ₹1,95,600 crore, up by 107% y-o-y.

Earlier this month, One97 Communications had a muted debut on the exchanges. The stock got listed at ₹1,955, a 9% discount to its IPO price of ₹2,150. Foreign brokerage house, Macquarie, downgraded the stock to 'underperform', saying Paytm's business model lacked focus and direction and the company was a 'cash guzzler'.

The share price of One97 Communications ended at ₹1,781.15 apiece on the BSE on Friday, down 0.86%.