Paytm trimmed losses in the latest quarter after the Indian fintech company cut some costs and scaled up services to small merchants.
Net loss shrank to 2.2 billion rupees ($26.5 million) for the three months through December, the firm officially called One 97 Communications Ltd. said Friday in a statement. Analysts estimated a loss of 2.55 billion rupees. Sales rose 38% to 28.5 billion rupees.
The SoftBank Group Corp.-backed payment services provider is trying to keep costs in check while bolstering its offerings as digital payments gather steam in India. It achieved operating profitability last year before factoring in the cost of employee stock ownership plans and expects artificial intelligence to help it curb expenses as it targets further improvement.
On Friday, Paytm said AI helped cut indirect costs, as a percentage of revenue, by 3 percentage points. It also said it had disbursed 4.9 billion rupees in high-value loans in the quarter. Paytm categorizes loans above 300,000 rupees as high value.
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Paytm’s engineering teams are aggressively using AI, a move that narrowed the development of new products to just days from weeks, billionaire founder Vijay Shekhar Sharma told Bloomberg News previously.
Sharma late last year acquired shares from Ant Group Co., cementing his control over the firm and assuaging investors worried about Indian government opposition to Chinese ownership.
He has now vowed to revamp online wealth management and insurance services as well as get more merchants on the Paytm network. Paytm has also launched new devices that are helping to drive demand for its merchant payments business.
The fintech’s devices business, which includes card machines and a speaker that alerts merchants to payments received, grew by 1.4 million units in the quarter through December.
Paytm, based on the outskirts of New Delhi, competes with financial services offered by Amazon.com Inc., Google and Walmart Inc. Tycoon billionaire Mukesh Ambani’s Jio Financial Services Ltd. has also entered the space, threatening to shake up the fledgling sector.
