Paytm Reports 13.2% Growth in Q3 FY2023-24 Revenue, Implements Cost-Cutting Measures
Three points you will get to know in this article:
- Paytm’s Q3 FY23-24 revenue rose 13.2%, hitting Rs 2,850.5 crore, with 38% from payment services.
- Expenses totaled Rs 3,216.3 crore, 37% in employee benefits, and a 24% decrease in losses.
- Paytm’s stock fluctuated from Rs 990 to Rs 610 per share, currently at Rs 766, with a market cap of Rs 49,176 crore or $5.9 billion.
Paytm, a big financial technology company, recently shared its financial results for the third quarter of the financial year that ends in March 2024. The results show that Paytm’s revenue from its business operations increased by 13.2% to Rs 2,850.5 crore in the three months ending December 2023. This is compared to Rs 2,518.6 crore in the previous quarter.
Revenue by Business Segment
The company’s total operating revenue grew by 38.2% compared to the same quarter in the previous year, reaching Rs 2,062.2 crore.
One interesting thing to note is that 38% of Paytm’s income comes from the payment services it offers to merchants. In this quarter, revenue from this service increased by 69% to Rs 1,081 crore, up from Rs 640 crore in the previous quarter of the same financial year.
In the last three months, a company called Paytm earned Rs 598 crore from providing payment services to customers and Rs 514 crore from commerce and cloud services. They also made Rs 658 crore from other parts of their business.
Cost Analysis
During this time, the company spent a lot of money on employee benefits, which made up 37% of all their expenses. This cost stayed about the same at Rs 1,187.2 crore, and it also included an ESOP cost of Rs 378.5 crore.
Another big expense for the company was payment processing charges, which went up by 20% to Rs 982.2 crore. They also spent Rs 275.2 crore on marketing and promotions. Additionally, they had to pay Rs 170.4 crore on software, cloud, and data center costs. In total, all their expenses went up by 9.5% to Rs 3,216.3 crore in this quarter. In the previous quarter, their total expenses were Rs 2,936.7 crore.
Reduction in Losses
Paytm saw a decrease in its losses by 24% in the third quarter (Q3) of the financial year 2023-24. This means the company’s losses went down to Rs 221.7 crore from Rs 291.7 crore in the previous quarter. Compared to the same quarter the previous year, the company’s losses had reduced from Rs 392.1 crore.
On a unit level, the company spent Rs 1.13 to earn a rupee of operating income during Q3 of FY24. This indicates the company’s operating efficiency.
Stock Performance
In October 2023, Paytm’s share price hit a high point at Rs 990 per share, but by December, it had dropped to around Rs 610 per share. Currently, the share price is at Rs 766 per share with a market capitalization of Rs 49,176 crore or $5.9 billion.
In December last year, Paytm reportedly laid off 1,000 employees as part of a cost-cutting initiative. The company also decided to reduce its small-ticket loans of less than Rs 50,000.
In the third quarter of FY2023-24, Paytm’s business operations revenue increased by 13.2% to Rs 2,850.5 crore, with 38% of income derived from merchant payment services. Operating expenses reached Rs 3,216.3 crore, marking a 9.5% increase. However, the company achieved a 24% reduction in losses, amounting to Rs 221.7 crore. Notably, Paytm’s stock price fluctuated from Rs 990 to Rs 610 per share but currently stands at Rs 766 per share, with a market capitalization of Rs 49,176 crore or $5.9 billion. Additionally, the company initiated cost-cutting measures, including staff layoffs and a reduction in small-ticket loans.
