Paytm (One 97 Communications Ltd) reported its Q1 FY26 results, surpassing Street estimates on profitability and margins while posting robust revenue growth.
The company’s net profit stood at ₹123 crore, significantly higher than the expected ₹2 crore and a sharp turnaround from a loss of ₹838 crore in Q1 FY25. Revenue from operations came in at ₹1,918 crore, up 28% YoY and slightly below the expected ₹1,971 crore but still demonstrating healthy top-line growth compared to ₹1,502 crore in Q1 FY25.
On the operating front, Paytm’s EBIT loss narrowed to ₹185 crore, in line with the estimated loss of ₹185 crore but much better than the ₹970 crore loss a year ago. EBIT margin improved to -9.6%, almost matching the expected -9.39% and showing a strong recovery from -64.6% in Q1 FY25.
Key Metrics: Actual vs Estimates
| Metric | Q1 FY26 (Actual) | Q1 FY26 (Estimate) | Q1 FY25 (YoY) |
|---|---|---|---|
| Revenue (NII) | ₹1,918 crore | ₹1,971 crore | ₹1,502 crore |
| EBIT | ₹-185 crore | ₹-185 crore | ₹-970 crore |
| EBIT Margin (%) | -9.6% | -9.39% | -64.6% |
| Net Profit | ₹123 crore | ₹2 crore | ₹-838 crore |
The company attributed the improved profitability to a sharp increase in merchant subscription revenue, cost optimization, and rising contribution from financial services. Contribution margin expanded to 60%, up from 50% last year.
Paytm also maintained a strong cash balance of ₹12,872 crore, providing adequate cushion for future investments and growth initiatives.
With EBIT margins improving significantly and net profit exceeding expectations by a wide margin, Paytm’s Q1 results reflect its operational resilience and strategic focus on profitability.
