Paytm’s Q4 results affected by UPI transition and payments bank embargo, expecting Rs 500 crore EBITDA impact.
Paytm’s fourth-quarter losses rose to Rs 550 crore, up from Rs 169 crore last year. Revenue dropped 3% YoY to Rs 2,267 crore.
Paytm CEO Vijay Shekhar Sharma informed shareholders about expected short-term financial impact on revenue and profitability due to Q4 disruptions. In a shareholder letter, Sharma also mentioned efforts towards significant cost efficiencies, including a leaner organizational structure.
Dear Shareholders,
FY 2024 marks a significant year for us as we achieved our inaugural full year of EBITDA prior to ESOP profitability (since IPO) amounting to ₹559 Cr. We sustained robust revenue growth (up 25%) while maintaining our disciplined approach to profitability (8% increase in EBITDA before ESOP margin), despite regulatory challenges faced by our affiliate, Paytm Payment Bank Ltd. (PPBL). Best regards
Navigating Through Paytm’s Q4 Challenges: CEO’s Shareholder Update
I am pleased to announce the successful transition of our core payment business from PPBL to other partner banks. This action reduces risk and creates new monetization opportunities, leveraging our strong customer and merchant engagement platform. Achieved with support from the Regulator, NPCI, Bank partners, and our dedicated team. The steadfast support of government and regulators for innovation and financial inclusion aligns with our mission and long-term growth goals.
Anticipate short-term financial impact on revenue and profitability due to Q4 disruptions, including steady state impact from PPBL wallet suspension. Several payments and loan products were also paused in the last quarter; pleased to note that many are being resumed or will resume shortly.
Leveraging AI capabilities and prioritizing core business, we’re pursuing substantial cost efficiencies through a leaner organizational structure. Our AI experiments and learnings aim to transform customer and merchant care in finance, while unlocking revenue and cost-saving opportunities. Anticipate tangible results soon, enhancing our competitive edge.
We are dedicated to building our business in compliance with regulations and prudent risk management policies. Steps are being taken to enhance governance across our group entities, particularly regulated ones, through the appointment of subject matter experts as advisors or independent directors, and the review of various processes. Ensuring increased regulatory engagement and stronger focus on compliance, both in letter and in spirit.
I take pride in our company’s talent, resilience, and entrepreneurial culture. Our commitment to growth, profitability, and robust governance and compliance is stronger than ever.
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