On a consolidated basis, One 97 Communications (Paytm)'s revenue surged 76.2% to Rs 1914 crore in Q2 September 2022 over Q2 September 2021.
The revenue was driven by increase in merchant subscription revenues, growth in bill payments due to growing MTUs (monthly transacting users) and growth in disbursements of loans through platform.On a QoQ basis, revenues grew 14% driven by growth in loan disbursements, continued growth in the merchant subscription base leading to increase in subscription and MDR (merchant discount rate) revenues, and increase in payment gateway revenue driven by higher GMV (gross merchandise value) in online business, primarily e-commerce. The firm has not recorded any UPI incentive this quarter as well.
Paytm's said its consolidated loss widened to Rs 571.10 crore in Q1 June 2022 from net loss of Rs 472.90 crore a year ago.
In Q2 FY 2023, EBITDA before ESOP cost was (Rs 166 crore) compared with (Rs 426 crore) in Q2 FY 2022 (61% improvement) and (Rs 275 crore) in Q1 FY2023 (39% improvement). EBITDA before ESOP cost margin improved to (9%) of revenues in Q2 FY 2023 from (39%) of revenues in Q2 FY 2022 and (16%) of revenues in Q1 FY 2023 demonstrating the strength of the company's business model, the ability to monetize its platform and its continued efforts in controlling cost structure.
The company's net cash, cash equivalent and investable balance of Rs 9,182 crore as of September 2022.
The company's contribution profit for the quarter stood at Rs 843 crore, an increase of 224% YoY and 16% QoQ. The contribution margin increased to 44% (as % of revenue) from 24% in Q2 FY 2022. During this period, the firm has driven improvement in net payment margin in payments business; and increased mix of high margin businesses such as loan distribution.
Contribution profit, a non-GAAP financial measure, is defined as revenue from operations less payment processing charges, promotional cashback & incentives expenses, connectivity & content fees, contest, ticketing & FASTag expenses & logistic, deployment & collection cost of businesses.
The company's payments services revenue grew 56% YoY and net payment margin grew by over 400%, on back of platform expansion.
Revenue in the financial services and others business was Rs 349 crore, up 293% YoY (increased 29% QoQ), and now accounts for 18% of total revenue (versus 8% in Q2 FY 2022), driven by sourcing and collection revenues in loan distribution business.
Total loans disbursed, in partnership with lending partners were 9.2 million in the quarter (up 224% YoY and 8% QoQ), amounting to Rs 7,313 crore (up 482% YoY and 32% QoQ).
Commerce & cloud revenues grew 55% YoY. Commerce revenue grew 49% YoY due to higher ticketing sales. Cloud revenues were up 58% YoY as advertising revenues started recovering while Credit card revenues continue to scale as well.
In Q2 FY 2023, the company's marketing costs (excluding promotional cashback and incentives) at Rs 137 crore, reduced to 7% of revenues from 10% in Q1 FY 2023 and 9% in Q2 FY 2022. On an absolute basis, these costs were up 34% YoY but down 22% QoQ. The QoQ decline was driven by reduced seasonal sponsorship spend in Q2 FY 2023.
In Q2 FY 2023, employee costs (excluding ESOP cost) at Rs 573 crore were 30% of revenues, down from 34% of revenues in Q2 FY 2022. On an absolute basis, these costs were up 56% YoY and 4% QoQ as the company continues to invest in sales channels to drive the penetration of its devices that have attractive economics and upsell opportunities.
In Q2 FY 2023, software, cloud, and data center costs at Rs 173 Cr were 9% of revenues down from 10% in Q2 FY 2022. On an absolute basis, these costs were up 53% YoY and 7% QoQ primarily due to an increase in cloud infrastructure costs, due to growth of business.
One 97 Communications is the digital financial services firm which operates under the Paytm brand. Paytm is India's payment super app offering consumers and merchants comprehensive payment services.
Shares of Paytm rose 0.27% to Rs 651.95 on Monday, 7 November 2022.
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