Paytm posts Rs 266 Cr profit in Q3 as it cuts key costs
Paytm kept revenue momentum intact while reining in costs, lifting operating revenue 20% to Rs 2,194 crore.
Paytm posted a sharp turnaround in the December quarter as tighter control over costs and a one-time gain helped the fintech swing back into the black after an operational loss a year earlier.
The digital payments firm reported a profit after tax of Rs 266 crore in Q3 FY26, up 40.7% from Rs 189 crore a year ago. The headline number was boosted by an exceptional gain of Rs 397 crore from the sale of its stake in Japan’s PayPay, which flowed through to the parent’s profits.
Profit before tax, exceptional items and share of associates stood at Rs 231 crore, compared with a loss of Rs 203 crore in Q3 FY25.
Employee benefit expenses declined 4.6% to Rs 721 crore, while other expenses were cut sharply by more than 22% to Rs 333 crore, suggesting lower advertising costs. Payment processing charges still increased at 17.5%, reaching Rs 671 crore.
Revenue momentum held up even as Paytm pulled back on spending. Revenue from operations rose 20% to Rs 2,194 crore, driven by steady growth across payments and financial services. At the same time, total expenses fell 2% to Rs 2,175 crore.
Paytm’s operating metrics underscore how sharply the business has turned the corner over the past year, with profitability improving quarter after quarter as revenue growth outpaced costs.
The fintech firm’s EBITDA swung from a loss of Rs 223 crore in the December 2024 quarter, translating into a negative margin of 12%, to a profit of Rs 156 crore in the December 2025 quarter. Margins expanded to 7%, marking five consecutive quarters of improvement and highlighting tighter cost controls alongside a steadier revenue mix. EBITDA, or earnings before interest, tax, depreciation and amortisation, is a measure of a company’s operating profitability.
Growth was led by the core payments and financial services engine. Revenue from payment services rose 19% year-on-year to Rs 1,192 crore in the December 2025 quarter, while distribution of financial services grew even faster, climbing 34% to Rs 672 crore as loan and financial product distribution scaled up.
Marketing services remained a drag, declining 11% to Rs 238 crore from a year earlier, though the segment showed a modest sequential uptick.
Merchant expansion continued to provide a stable base. The number of merchants subscribing to devices such as soundboxes increased from 1.37 crore in the September quarter to 1.44 crore in December.
Edited by Jyoti Narayan