Revenue from operations, meanwhile, increased 24% year-on-year (YoY) to Rs 2,061 crore, led by increase in subscription merchants, higher payments GMV, and growth in distribution of financial services.
Contribution profit for the quarter stood at Rs 1,207 crore (up 35% YoY), with a contribution margin of 59% (up 5 percentage points YoY), driven by improved net payment revenue, higher share of distribution of financial services revenue, and reduction in DLG expenses.
The net payment revenue was up 28% YoY to Rs 594 crore, led by growth in high quality subscription merchants and increase in payment processing margins. Distribution of financial services revenue increased by 63% YoY to Rs 611 crore, driven by growth in merchant loan distribution
The company said it has seen consistent gain in consumer market share over the past few months due to product improvement and addition of AI features.
Going forward, Paytm has identified four focus areas. Firstly, the company is planning to expand leadership across small and large, both online and offline merchants by deepening penetration of full stack payment offerings including payment gateway solutions, QR, Soundbox, All in One POS card machines, etc.The company is also looking to grow its financial services distribution through an increase in the number of lending partners including banks, introduction of new products such as Paytm Postpaid with a bank partner, and continued enhancement of collection performance using AI.Further, Paytm said it is driving AI-first, product-led innovation to enhance consumer experience and boost retention, supporting continued gains in consumer market share
As an additional long-term growth driver, Paytm is evaluating select new markets for its technology and products. “We expect this initiative to start contributing meaningfully after 2-3 years,” it said.