Paytm Q2 marketing spend down 42% on lower CAC; marketing services revenue at Rs 228 crore

New Delhi: Paytm has cut consumer-acquisition marketing spend by 42% year-on-year to Rs 72 crore in Q2 FY26, driven by lower customer-acquisition cost and better retention cohorts. 

On a sequential basis, the company spent 16% more than the Rs 62 crore in Q1 as it pushed market-share gains. 

On revenue, the Marketing Services segment delivered Rs 228 crore in Q2 FY26. Reported revenue declined 25% year-on-year; on a like-to-like basis—excluding the entertainment ticketing business sold in Q2 FY25—it was down 15%. 

Paytm said product-led app optimisations and simplified, targeted upsell offers have trimmed near-term marketing services revenue but improved user retention and share. GMV for ticketing, deals and gift vouchers stood at Rs 1,949 crore, and the company said AI-led cohorting continues to lift advertiser ROI. It expects rising MTUs and a stronger upsell funnel to support growth.

During the quarter, Paytm's operating revenue rose 24% year-on-year to Rs 2,061 crore, driven by continued growth in its payments and financial services businesses.

The company reported a profit after tax (PAT) of Rs 211 crore, before a one-time charge for full impairment of Rs 190 crore loan to our JV, First Games Technology Pvt Ltd.

Reported PAT stood at Rs 21 crore. The result marks a significant improvement from the previous quarter, underscoring Paytm’s progress towards sustainable profitability.

EBITDA improved to Rs 142 crore, with a 7% margin, on account of revenue growth and operating leverage.

Contribution profit grew 35% year-on-year to Rs 1,207 crore, with a healthy 59 per cent margin, driven by higher net payment margins and an increased share of financial services revenue.

Paytm’s payment services revenue rose 25% year-on-year to Rs 1,223 crore, while net payment revenue increased 28% to Rs 594 crore.

Gross Merchandise Value (GMV) surged 27% year-on-year to Rs 5.67 lakh crore, supported by improved processing margins on account of higher growth of credit cards on UPI and affordability offerings (such as EMI).

The company’s merchant ecosystem continued to expand, with subscriptions reaching an all-time high of 1.37 crore, up 25 lakh year-on-year, reinforcing Paytm’s leadership in omni-channel merchant payments.

Its revenue from the distribution of financial services jumped 63% year-on-year to Rs 611 crore, led by robust merchant loan disbursements and improved collection performance experience for lending partners.

Over 6.5 lakh consumers availed Paytm’s financial services during the quarter, reflecting growing adoption across its ecosystem.

On the operational front, indirect expenses declined 18% year-on-year and 1% quarter-on-quarter at Rs 1,064 crore.