PhonePe trims losses, revenue up by 74%
Walmart-owned fintech major PhonePe losses have narrowed by 28.5 per cent to ₹1,997 crore in the financial year 2024 (FY24), from ₹2,792 crore it posted in FY23.
The PhonePe Group recorded revenue from operations of ₹5,064 crore for FY24, representing 74 per cent top-line growth from FY22-23 revenue of ₹2,914 crore.
The group also reported an adjusted Profit After Tax (i.e., PAT excluding ESOP costs) of ₹197 crore for FY23-24, as compared to loss of ₹738 crore in FY22-23. Furthermore, the standalone Payments business recorded Adjusted PAT of ₹710 crore for FY23-24 from ₹194 crore in the year ago period.
PhonePe’s expenses grew to ₹7,756 crore in FY24, up from ₹5,907 crore in FY23 . Payment processing charges alone constituted about 15 per cent of its total expenses and they were pegged at ₹1,166 crore.
“At PhonePe, our goal is to build Internet platforms that empower Indian citizens to improve their lives and achieve their aspirations. Free market competition, driven by product innovation and service excellence, is the future. Transparency is central to this, which is why we are proud to release our first annual report,” said Sameer Nigam, CEO and Founder of PhonePe.
One of the largest Unified Payments Interface (UPI) players, PhonePe processed 7.22 billion transactions in September alone, recording around 48 per cent market share.
Most of the transactions on UPI continue to be free for merchants and customers with payment processing costs borne by fintechs and banks.
Despite significant external challenges over the past five years, including the “Zero MDR” law and the COVID-19 pandemic, our relentless focus on process automation and unit economics has driven a clear path to profitability, said the company in its annual report.
From FY18-19 to FY23-24, transactions on the platform surged over 40X, while its customer service team has reduced by 60 per cent from approximately 1,100 to over 400 agents, as the company has leveraged AI for the same. Despite these cuts, PhonePe has maintained, and even improved, customer satisfaction, as seen by its consistently growing Net Promoter Score (NPS) during the same period.
PhonePe’s focus remains on ‘empowering India with the best of the internet’s roving technologies’, it added in its report.
In a bid to expand its homegrown business empire, it launched two subsidiaries– Pincode and IndusApp.
It launched Indus Appstore in Feburary- as a direct competition for Google and Apple’s online application stores and in 2023, it launched Pincode.
PhonePe reported that it has created over 22,000 jobs across India and employs more than 1,500 engineers.