Paytm vs PhonePe: Revenue, Profit and Business Model
Paytm reported ~$978.7M of revenue in FY2026 and ~$64.1M of net income. PhonePe reported ~$918.7M of revenue in FY2026 and a net loss of ~$323.9M.
Latest financial snapshot
Financial summary
Paytm
Paytm lost money every year after its 2021 IPO, with net losses of about $278 million (₹2,393 crore) in FY22 and ~$206 million (₹1,776 crore) in FY23. The 2024 RBI action on Paytm Payments Bank cut FY25 revenue to ~$800 million (₹6,900 crore). Recovery followed: FY26 revenue from operations rose 22.2% to ~$979 million (₹8,437 crore) with a full-year profit of about $64 million (₹552 crore), and Q4 FY26 profit was about $21.3 million (₹184 crore) against a ~$62.6 million (₹540 crore) loss a year earlier. Q1 FY27 set records with ~$284 million (₹2,448 crore) revenue (+28%), EBITDA of ~$23.5 million (₹203 crore) (8% margin) and profit after tax of ~$25.5 million (₹220 crore) (+79%). In July 2026 the board decided not to proceed with a proposed bonus share issue.
PhonePe
PhonePe's revenue from operations grew from ~$338 million (₹2,914 crore) in FY23 to ~$587 million (₹5,064 crore) in FY24 and ~$825 million (₹7,115 crore) in FY25, a CAGR of about 56% according to its DRHP. Over the same period, its loss margin improved from about -91% to -23%. FY25 net loss was ~$200 million (₹1,727 crore), and the company reported positive free cash flow that year. Growth then slowed. FY26 revenue rose 11% to about $919 million (₹7,920 crore), and consolidated net loss widened 62% to ~$324 million (₹2,792 crore), according to MCA filings reported by Moneycontrol. ESOP charges tied to the IPO and losses at subsidiaries drove much of the wider loss, and PhonePe put its normalised FY26 loss at about $160 million (₹1,377 crore).
Revenue and profit by year
Paytm
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | ~$978.7M | ~$64.1M | 6.6% | +22.3% | Source |
| FY2025 | ~$800.4M | ~-$76.4M | -9.6% | -30.8% | Source |
| FY2024 | ~$1.2B | ~-$164.4M | -14.2% | +24.9% | Source |
| FY2023 | ~$926.9M | ~-$206M | -22.2% | +60.6% | Source |
| FY2022 | ~$577M | ~-$277.6M | -48.1% | — | Source |
Business model and strategy
Paytm
How it makes money
Paytm runs a capital-light, two-sided model. On the merchant side it deploys QR codes, Soundbox audio devices and Android card machines, charging monthly device subscription fees and earning payment processing revenue on cards, EMI and online payments (UPI person-to-merchant payments carry zero MDR, so device rentals and online gateway fees matter).
Growth strategy
Paytm's strategy since 2024 has three parts: grow the device merchant base and its payment processing revenue, use merchant and consumer data to distribute more loans for partner banks and NBFCs, and keep costs flat through AI and automation. In 2026 the company said it would hire about 4,000 people, mostly in sales, while trimming roughly 1% of staff. Marketing spend fell 19% in FY26.
Competitive advantage
Paytm's edge is its offline merchant base. It pioneered the Soundbox in 2019 and added about 2.7 million Soundboxes in the year to June 2026. Daily transaction data from these device merchants lets partner lenders underwrite small shopkeepers who lack credit bureau history, which is why lending distribution has become Paytm's fastest-growing revenue line.
PhonePe
How it makes money
Consumer UPI payments on PhonePe are free, and person-to-merchant UPI has carried zero merchant discount rate (MDR), so the payments app mostly works as a way to bring in users. Revenue comes from four main areas. First, merchant payments: SmartSpeaker soundbox and POS device rentals, payment gateway fees and card-based transactions.
Growth strategy
PhonePe's growth plan is to earn more from the users it already has rather than add payments users. It is focusing on four areas. Credit distribution covers personal, merchant and secured loans through partner lenders. Insurance broking is a second area. Wealth covers mutual funds and Share.Market broking. Merchant services cover soundboxes, POS devices and the payment gateway.
Competitive advantage
PhonePe's lead comes from scale on both sides of the UPI network. It has more than 700 million registered consumers and 50 million registered merchants. Much of that merchant base was built by field sales teams placing QR codes and SmartSpeaker devices across nearly every Indian pin code. That reach lets PhonePe sell loans, insurance and investments to customers it already has, without paying much to acquire them.
Questions about Paytm vs PhonePe
Which company has higher revenue — Paytm or PhonePe?
Paytm reported ~$978.7M (FY2026), while PhonePe reported ~$918.7M (FY2026). By last reported revenue, Paytm is the larger business, with PhonePe reporting a smaller revenue base.
What is the market cap of Paytm vs PhonePe?
Paytm's market capitalisation stands at $12.0B, while PhonePe's is $12.0B. Paytm carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to PhonePe.
Which is more financially efficient — Paytm or PhonePe?
Paytm generates $24k / employee in revenue per employee, while PhonePe generates $46k / employee. PhonePe shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Paytm and PhonePe make money?
Paytm and PhonePe generate revenue in fundamentally different ways. Paytm: Paytm runs a capital-light, two-sided model. PhonePe: Consumer UPI payments on PhonePe are free, and person-to-merchant UPI has carried zero merchant discount rate (MDR), so the payments app mostly works as a way to bring in users.
Which company is valued higher relative to revenue — Paytm or PhonePe?
On a price-to-sales (P/S) basis, Paytm trades at 12.3x P/S and PhonePe at 13.1x P/S. PhonePe commands a higher revenue multiple, typically indicating that investors expect faster growth or higher future margins compared to Paytm. A higher multiple is not inherently better — it may also signal that the stock is priced for perfection.
Is Paytm bigger than PhonePe?
By last reported revenue, Paytm (~$978.7M (FY2026)) is the larger company compared to PhonePe (~$918.7M (FY2026)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Paytm vs PhonePe overview