One 97 Communications Ltd, the parent company of Paytm, has reported a consolidated net profit of Rs 123 crore for the quarter ending June 30 (Q1 FY26)—a remarkable turnaround from a loss of Rs 840 crore in the same quarter last year. This marks the company’s first core profit since its IPO in 2021, signalling improved operational efficiency and business strength.
The performance was driven largely by a robust lending segment and disciplined cost management. Operating revenue increased 28% year-on-year to Rs 1,918 crore, up from Rs 1,502 crore in Q1 FY25 and slightly higher than the Rs 1,911 crore reported in the previous quarter. Including other income, total revenue reached Rs 2,159 crore for the quarter.
Paytm’s contribution profit rose sharply by 52% to Rs 1,151 crore, with the contribution margin improving to 60%, compared to 50% a year ago. This improvement came alongside a 19% year-on-year reduction in expenses, which fell to Rs 2,016 crore. Marketing expenses dropped by 55% to Rs 100 crore, while employee costs were cut by 33% to Rs 643 crore. Despite being the largest cost component, employee expenses were offset by savings in software, communications, and other operations.
The company also reported a positive Ebitda of Rs 72 crore in Q1, reversing the losses seen in the previous two quarters. Paytm attributed the gains to operating leverage and AI-led automation, which helped lower costs across functions such as onboarding, customer support, and transaction monitoring.
The financial services segment posted strong growth, with revenue rising to Rs 561 crore, double that of the same period last year. While personal loan issuance slowed due to tighter RBI regulations on unsecured lending, merchant loans and legacy portfolio income remained robust, supported by non-DLG partnerships.
Paytm provided services to 5.6 lakh financial services customers, including loans, insurance, and equity broking. The company plans to strengthen its Paytm Money platform, particularly in mutual funds and stock trading.
Meanwhile, net payment revenues rose 38% to Rs 529 crore, driven by an increase in subscription-based merchant devices, which hit a record installed base of 1.3 crore. Despite flat sequential growth, margins improved through better capital allocation and field efficiency. The quarter ended with a cash balance of Rs 12,872 crore.
