May 22, 2024 03:29 PM IST
Paytm layoffs: Paytm reported a net loss of ₹550 crore in the quarter ended March 2024 and its revenue from operations in Q4FY24 dipped 2.6 percent.
Paytm announced that there may be job cuts at the company as it plans to trim non-core assets following its first-ever decline in sales on May 22. Paytm reported Q4 results after a regulatory probe into its financial arm Paytm Payments Bank (PPBL) by the Reserve Bank of India (RBI. The company reported a net loss of ₹550 crore in the quarter ended March 2024 and its revenue from operations in Q4FY24 dipped 2.6 percent to ₹2,267.10 crore.
Read more: Paytm Q4: Vijay Shekhar Sharma tells shareholders ‘anticipate tangible results’
In a letter to shareholders, Vijay Shekhar Sharma said, “We expect near-term financial impact to our revenue and profitability, due to disruptions faced in our business in Q4. This includes steady state impact due to pausing of PPBL wallet. We had also paused a few other payments and loan products to our customers during the last quarter, and I am happy to share that many such products have been restarted or in the process of starting soon.”
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Paytm said that it was profitable before interest, taxes, depreciation, and amortisation, excluding employee incentives but warned of further revenue declines to ₹150-160 crore in the June quarter while anticipating “meaningful improvement” thereafter. Bloomberg analyst Nathan Naidu predicted a strong comeback for Paytm in fiscal 2026, noting, “Paytm is poised for a strong sales and margin comeback in fiscal 2026 from a past mired in regulatory woes, driven by a long runway and strong user-acquisition funnel from payments. Its share in Indian digital payments, albeit less dominant than Walmart’s PhonePe and Google Pay, could remain steady, helping it reach its 500-million user target. Regulatory woes should ease with a new license for payments, its bread and butter, with the segment’s margin set to widen on system optimization and its integrated offerings. Loan, insurance and advertising might catalyze sales for the Ant Financial-backed firm.”
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