Paytm’s parent company, One 97 Communications, reported a sharp increase in profitability for the second quarter of fiscal year 2027, with consolidated net profit rising to ₹225 crore from ₹21 crore in the same period a year earlier. Operating revenue grew 28% year-on-year to ₹2,648 crore for the July–September 2026 quarter, while earnings before interest, taxes, depreciation and amortisation (EBITDA) climbed 90% to a record ₹270 crore.
The results reflect stronger merchant and consumer payment activity, higher revenue from financial-services distribution and improving operating efficiency. However, the headline tenfold increase in profit requires context: the year-ago quarter included a ₹190 crore exceptional expense. Excluding exceptional items, Paytm’s net profit increased more modestly, from ₹211 crore to ₹229 crore, indicating that the latest performance reflects both business growth and the absence of the earlier one-off charge.
Key Takeaways
- Net profit: ₹225 crore in Q2 FY27, compared with ₹21 crore in Q2 FY26.
- Operating revenue: Rose 28% year-on-year to ₹2,648 crore.
- EBITDA: Increased 90% to a record ₹270 crore, with the margin reaching 10%.
- Comparable growth: Revenue increased 33% after adjusting for the discontinued Payments Infrastructure Development Fund incentive.
- Payment services: Revenue grew 25% to ₹1,434 crore.
- Financial-services distribution: Revenue increased 49% to ₹912 crore.
- User growth: Monthly transacting users reached 8.5 crore.
- Cash balance: Paytm reported ₹13,617 crore as of September 2026.
Paytm Q2 FY27 Results: Key Financial Figures
Paytm delivered growth across its main business activities, alongside a significant improvement in operating profitability.
| Financial metric | Q2 FY27 | Q2 FY26 | Year-on-year change |
|---|---|---|---|
| Operating revenue | ₹2,648 crore | ₹2,061 crore | +28% |
| Reported net profit | ₹225 crore | ₹21 crore | More than 10-fold |
| Net profit before exceptional items | ₹229 crore | ₹211 crore | +9% |
| EBITDA | ₹270 crore | ₹142 crore | +90% |
| EBITDA margin | 10% | 7% | +3 percentage points |
| Revenue from payment services | ₹1,434 crore | — | +25% |
| Financial-services distribution revenue | ₹912 crore | — | +49% |
Source: Paytm’s Q2 FY27 results and published financial reports. Dashes indicate figures not included in the cited summary.
Correction, 27 October 2026: The Q2 FY26 EBITDA comparison has been corrected to ₹142 crore, as reported in Paytm’s results release.
The figures show that revenue and operating earnings improved alongside reported net profit. The distinction between reported profit and profit before exceptional items is particularly important for understanding the company’s underlying performance.
Why Did Paytm’s Profit Jump 10-Fold?
The headline increase in profit is partly explained by the comparison with the previous year’s exceptional expense.
In Q2 FY26, Paytm recorded a ₹190 crore exceptional expense associated with a loan extended to its real-money gaming subsidiary, First Games Technology. This reduced the reported profit in the comparison quarter.
In Q2 FY27, reported net profit reached ₹225 crore. However, profit before exceptional items was ₹229 crore, compared with ₹211 crore in the corresponding period a year earlier. That represents growth of approximately 9%, rather than a tenfold increase.
The distinction does not diminish the improvement in operating performance. Paytm also reported higher revenue, stronger EBITDA and an expansion in its operating margin. These measures provide a clearer view of the progress in its underlying payments and financial-services businesses.
Revenue Growth Accelerates Across Paytm’s Businesses
Operating revenue increased 28% to ₹2,648 crore, supported by merchant payments, consumer transactions, financial-services distribution and greater monetisation of its user base.
Paytm said underlying operating revenue growth was 33% after adjusting for the Payments Infrastructure Development Fund (PIDF) incentive, which was received until December 2025. Because the incentive ended, reported revenue comparisons do not fully reflect the growth in the underlying business.
The company has been working to generate more revenue from its merchant network and consumer base instead of relying solely on transaction volumes. Merchant subscriptions, financial-product distribution and improvements in payment processing economics are important elements of that strategy.
Payment Services Revenue Rises 25%
Paytm’s payment services revenue grew 25% year-on-year to ₹1,434 crore. The company also reported net payment revenue of ₹644 crore, an increase of 21% on a comparable basis.
Its merchant payments business continued to expand. Merchant gross merchandise value (GMV) increased 26% to ₹7.1 lakh crore during the quarter, according to the company’s results announcement.
The number of merchants on subscription plans reached 1.64 crore, following the addition of 27 lakh merchants over the preceding year. Subscription-based devices, including Paytm Soundbox, help the company maintain merchant relationships and generate recurring revenue.
Paytm also reported that its consumer UPI transaction value grew 42% during the quarter, more than twice the industry’s reported 19% growth rate. It said this marked its sixth consecutive quarter of consumer UPI market-share gains.
Monthly transacting users rose by one crore year-on-year to 8.5 crore, the highest addition in nearly three years.
Financial-Services Distribution Revenue Grows 49%
Financial-services distribution was another major contributor to Paytm’s growth. Revenue from the segment increased 49% year-on-year to ₹912 crore.
The business distributes financial products, including merchant loans, personal loans and Paytm Postpaid, through partnerships with lending institutions. Paytm also generates revenue through wealth and investment-related products.
The company attributed growth to increased merchant loan distribution, stronger personal-loan activity and improved monetisation of products such as Margin Trade Funding and Paytm Gold.
Repeat borrowers accounted for more than half of merchant loan disbursements during the quarter. Paytm also reported a 35% year-on-year increase in key financial-services customers, to 8.8 lakh.
The distribution model allows Paytm to participate in financial services without relying exclusively on lending from its own balance sheet. Nevertheless, the business remains exposed to changes in lending-partner appetite, borrower demand and the broader regulatory environment.
EBITDA Reaches a Record ₹270 Crore
Paytm’s EBITDA increased 90% year-on-year to ₹270 crore, its highest quarterly level, while the EBITDA margin reached 10% for the first time.
EBITDA measures earnings before interest, taxes, depreciation and amortisation. It is commonly used to assess operating performance, although it is not equivalent to net profit or cash flow.
Paytm attributed its improved operating leverage to revenue growth, better monetisation and cost efficiencies. Indirect expenses declined to 46% of revenue from 52% a year earlier, according to the company.
After excluding the discontinued PIDF incentive, Paytm said EBITDA nearly quadrupled year-on-year, while the comparable EBITDA margin expanded from 3% to 10%.
These improvements suggest that revenue is growing faster than certain operating costs. Whether the margin gains can continue will depend on customer acquisition expenses, payment economics, employee costs and the company’s investments in new products.
AI Adoption Becomes Part of Paytm’s Strategy
Paytm said it is deploying specialised AI models and agents across engineering, customer engagement, merchant services, risk management, collections, fraud prevention and personalisation.
The company believes AI can help improve the efficiency of its operations by automating parts of software development, supporting customer service and helping merchants engage with customers. It has also begun offering its AI
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