Bengaluru-based fintech giant TelephonePe has crossed a major milestone by registering revenue of Rs 5,064 crore for the fiscal year ending March 2024.
This marks an increase of 74% from Rs 2,914 crore in FY23. The company’s revenue growth is mainly attributed to its payment services and significant interest income of Rs 661 crore, which mainly came from deposits and investments after a financing round of 195 million dollars.
Overall, PhonePe’s total revenue rose to Rs 5,725 crore in FY24, up from Rs 3,085 crore in the previous year.
Losses are significantly reduced
Notably, PhonePe reduced its losses by 28.6%, narrowing it to Rs 1,996 crore in FY24 from Rs 2,795 crore in FY23.
The company also reported a significant achievement – achieving profitability, excluding Employee Stock Ownership Plan (ESOP) costs, for the first time with an adjusted net profit of Rs 197 crore.
According to PhonePe, this financial improvement was driven by better cost management and automation, along with the company’s continued focus on operating leverage.
Personnel costs and operating expenses increase
PhonePe’s operating expenses also saw a notable rise during FY24. Employee benefits constituted 46.45% of the total expenses, and these costs increased by 16.4% to Rs 3,603 crore.
ESOP expenses alone accounted for Rs 1,876 crore, although only Rs 288 crore were settled in cash and the rest were non-cash expenses.
Payment processing costs increased 74.8% to Rs 1,166 crore, while expenses related to advertising, IT and legal fees contributed to the overall increase in costs, which reached Rs 7,756 crore in FY24.
AI-driven efficiency and job creation
One of PhonePe’s key achievements in recent years has been its focus on AI-powered automation, which has helped the company reduce its customer service staff by 60%.
Despite this, PhonePe has seen a 40x increase in transactions in the last five years, achieving 90% automated resolution of customer issues.
According to the company, this increased efficiency has been achieved without sacrificing customer satisfaction, as evidenced by its increasing Net Promoter Score (NPS).
Additionally, PhonePe has contributed to job creation, employing over 22,000 people across India, including 1,500 engineers developing new digital payment solutions.
Leadership and market valuation
PhonePe continues to dominate the UPI-based payments market and holds almost 50% of transaction volume and value in India.
As of March 2024, the company had 53 crore registered users and processed over 770 million monthly transactions, representing a total payment value of Rs 10.5 lakh crore ($1.5 trillion annually). ).
With a valuation of $12 billion, PhonePe remains India’s most valuable privately held fintech startup.
Sameer Nigam, Founder and CEO, PhonePe, said, “At PhonePe, our goal is to create internet platforms that empower Indian citizens to improve their lives and achieve their aspirations. We believe that continuous innovation is key to shaping a modern and developed economy ahead of India’s centenary of independence. Free competition in the market, driven by product innovation and service excellence, is the future. Transparency is key to this, which is why we are proud to publish our first annual report. “We hope it gives readers a better understanding of our operating philosophy, culture and governance model, and our business strategy.”
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