Walmart-owned PhonePe, which is planning to file its draft IPO papers in the coming months, has reported a 40% year-on-year rise in revenue from operations to Rs 7,114.9 crore in the financial year ended March 2025. The growth came primarily from a 30% jump in revenue from its payment services, while its smaller lending and insurance vertical expanded nearly three times.
According to financial statements by Tofler, revenue from payment services increased to Rs 6,299.7 crore in FY25 from Rs 4,788.5 crore in the previous year, while that from its lending and insurance business rose to Rs 557.6 crore from Rs 181 crore.
PhonePe has been enjoying the leading position among all UPI players. In terms of volume, PhonePe’s market share was 46% in August, while that of its closest competitor Google Pay was 35%, according to the NCPI data.
Strong growth across verticals
The company earns transaction processing fees from consumers, who use the app to make bill payments, recharge, and use other ticketing services, as well as from merchants for facilitating their online and offline payments. PhonePe also charges a set-up and subscription fee on the Point of Sale (POS) payment devices it offers to merchants.
In FY25, revenue from its other services, which include its newly-launched stockbroking and mutual fund distribution businesses as well as its quick delivery app Pincode, rose to Rs 57.3 crore from Rs 22.3 crore in FY24.
A strong revenue growth, coupled with a slower rise in expenses, helped the company narrow its net loss to Rs 1,735.6 crore from Rs 1,996 crore in the previous year. However, after adjusting the Esop cost, the company reported a profit of Rs 630 crore, compared to Rs 197 crore in FY24.
PhonePe turned free cash flow positive in FY25, sources said, with cash flow from operations of Rs 1,202 crore. Adjusted Ebitda (excluding Esop cost) also more than doubled to Rs 1,477 crore.
RBI nod boosts expansion plans
Total expenses rose 20% y-o-y to Rs 9,394 crore, including a 45% rise in payment processing charges to Rs 1,688 crore. Besides this, costs rose across all segments, including those related to employees, finance, and depreciation.
Last week, PhonePe received final authorisation from the Reserve Bank of India (RBI) to operate as a payment aggregator, enabling it to expand beyond its UPI-based app into broader payment gateway services. With this licence, PhonePe can collect and settle merchant payments across cards, net banking, and wallets, with a particular focus on serving small and medium businesses.