Revenue shares of One 97 Communications (Paytm) jumped 76.2% to Rs 1,914 crore in the second quarter of September 2022 from the second quarter of September 2021.
Revenue was driven by increased merchant subscription revenue, growth in bill payments due to growth in MTUs (monthly transacting users), and growth in loan disbursements through the platform.
On a QoQ basis, revenue increased 14% driven by growth in loan disbursements, continued growth in the merchant subscription base resulting in increased subscription revenue and MDR merchants), and increased revenue from payment gateways due to higher GMV (gross merchandise). value) in online business, primarily e-commerce. The company also recorded no UPI incentives this quarter.
Paytm’s said its consolidated loss widened to Rs 571.10 crore in the first quarter of June 2022 from a net loss of Rs 472.90 crore a year ago.
In the second quarter of FY2023, EBITDA before ESOP cost was (Rs 166 crore) compared to (Rs 426 crore) in the second quarter of FY2022 (61% improvement) and at (Rs 275 crore) in the first quarter of FY2023 (39% improvement). EBITDA before ESOP cost margin improved to (9%) of revenue in Q2 2023 from (39%) of revenue in Q2 2022 and (16%) of revenue in Q1 2023, demonstrating the strength of the business model of company, the ability to monetize its platform and its ongoing efforts to control the cost structure.
Net cash, cash equivalent and investable balance of the company of Rs 9,182 crore as of September 2022.
The company’s contribution profit for the quarter was Rs 843 crore, an increase of 224% year-on-year and 16% quarter-on-quarter. Contribution margin increased from 24% in Q2 2022 to 44% (as % of revenue). and an increased mix of high-margin activities such as loan distribution.
Contribution earnings, a non-GAAP financial measure, is defined as operating income less payment processing fees, promotional and incentive reimbursement expenses, connectivity and content expenses, competitions, ticketing and FASTag and the costs of logistics, deployment and collection of companies.
The company’s payment services revenue increased 56% year-on-year and net payment margin increased by more than 400%, driven by platform expansion.
Financial services and other revenue was Rs 349 crore, up 293% YoY (29% increase QoQ), and now accounts for 18% of total revenue (vs. 8% in the second quarter of fiscal year 2022), driven by procurement and collection revenues in the loan distribution business.
Total loans disbursed, in partnership with lending partners, amounted to 9.2 million during the quarter (up 224% year-on-year and 8% quarter-on-quarter), amounting to 7,313 crores of rupees (up 482% YoY and 32% QoQ).
Commerce and cloud revenue grew 55% year-over-year. Commerce revenue increased 49% year-on-year due to higher ticket sales. Cloud revenue grew 58% year-over-year as ad revenue began to recover, while credit card revenue also continues to rise.
In the second quarter of FY2023, the company’s marketing costs (excluding promotional cashback and incentives) at Rs 137 crore, reduced to 7% of revenue, from 10% in the first quarter of FY2023 and 9% in the second quarter of fiscal 2022. On an absolute basis, these costs were up 34% year-on-year but down 22% quarter-on-quarter. The quarter-over-quarter decline is due to reduced seasonal sponsorship spending in the second quarter of fiscal 2023.
In the second quarter of FY2023, payroll costs (excluding ESOP cost) at Rs 573 crore accounted for 30% of revenue, compared to 34% of revenue in the second quarter of FY2022. On an absolute basis, these costs increased 56% year-on-year and 4% quarter-on-quarter. the company continues to invest in sales channels to drive the penetration of its devices which present compelling economic opportunities and upsell opportunities.
In the second quarter of FY2023, software, cloud and data center costs at Rs 173 Cr accounted for 9% of revenue compared to 10% in the second quarter of FY2022. On an absolute basis, these costs increased 53% year-on-year and 7% quarter-on-quarter, primarily due to higher cloud infrastructure costs, driven by business growth.
One 97 Communications is the digital financial services company that operates under the Paytm brand. Paytm is India’s super payment app providing consumers and merchants with comprehensive payment services.
Shares of Paytm rose by 0.27% to Rs 651.95 on Monday, November 7, 2022.
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