Paytm Q2 results preview: Revenue likely to fall over 30% YoY, net loss to widen; check key details

Experts believe that the online payment services provider is likely to report sequential growth in revenue from operations and may narrow down its losses. However, on a yearly basis, revenue and net losses are likely to increase.

Revenue from operations is being pegged by the experts in the range of ₹1,620 to ₹1,635 crore for Q2FY25, down nearly 32-35% YoY, while net losses are expected in the range of ₹575 to ₹660 crore.

As per experts, Paytm’s loan disbursements and gross merchandise value (GMV) likely to improve on a sequential basis.

Meanwhile, during its Q1FY25 earnings call, Paytm said that its profitability and revenue should start improving from the second quarter due to better cost management.

The company had said that it expects improvement in operating metrics, including gross merchandise value and merchant device additions, while employee costs should also start coming down from July to September.

Previous quarter performance

In Q1FY25, Paytm posted its biggest quarterly loss since going public in 2021, as the company wrapped up its payments banking unit earlier this year.

Paytm’s consolidated net loss had widened to ₹839 crore for Q1 FY25, compared with a loss of ₹357 crore in Q1 FY24.

EBITDA (earnings before interest, tax, depreciation and amortisation) before cost of employee stock options stood at negative ₹545 crore for Q1FY25, broadly in line with the company’s earlier estimate of ₹500-600 crore.

Revenue from operations had also fallen 36% to ₹1,502 crore in the first quarter. In comparison, the company reported ₹2,342 crore in revenue in Q1FY25.

Key things to look out for

One of the key things that investors would be watching out for is Paytm’s management commentary around regulatory issues. Earlier this year, the Reserve Bank of India (RBI) barred Paytm Payments Bank from accepting new deposits and conducting credit transactions with customer accounts. Services related to prepaid instruments, wallets, FASTags and National Common Mobility Cards were also restricted.

The company’s expansion plans, if any, for its non-loan distribution business may boost the sentiment around the fintech stock.

Paytm share price performance

Traders seem cautious about Paytm shares ahead of the Q2FY25 earnings announcement, with the stock trading lower by 1.87% in morning trade on the NSE. Shares of One97 Communications were trading at ₹712.4 apiece, down 1.87%, on the NSE at 9:20 am.

In the past five trading sessions, Paytm shares have gained less than 1%. The stock is up 12% year-to-date in 2024, but is down 22% in the past one year.