PhonePe Reports FY26 Losses To ₹2,792 Cr, Revenue Rises 11%

Walmart-owned fintech company PhonePe reported a sharp increase in losses for Financial Year 2026 as higher operating costs outweighed a modest rise in revenue.

The company posted a net loss of ₹2,792 crore, up 62% from the previous financial year, while operating revenue increased 11% to ₹7,920 crore, The Economic Times (ET) reported citing regulatory filings accessed by Tofler.

The pace of revenue growth slowed considerably compared with the 40% growth recorded in FY25 and 74% in FY24, according to the filings.

Total expenses rose 13% to ₹10,588.5 crore, largely due to higher spending under other expenses, including advertising costs, the filings showed.

Lending, Wealth and Insurance Businesses Expand

Among PhonePe's business verticals, its lending arm emerged as the strongest performer. Revenue from the lending subsidiary more than doubled to ₹945 crore in FY26 from ₹377.6 crore a year earlier, according to the regulatory filings.

The company's wealth broking business also more than doubled its revenue to ₹108 crore, while its insurance arm reported revenue of ₹191 crore, up from ₹180 crore in FY25.

However, hyperlocal commerce platform Pincode generated revenue of just ₹4.5 crore during the year, almost half of the previous year's level.

The decline followed the company's decision in December to discontinue its business-to-consumer (B2C) operations and concentrate on business-to-business (B2B) solutions for offline retailers.

The filings also showed that PhonePe incurred a one-time expense of ₹231 crore in FY26, significantly higher than ₹27 crore in the previous year.

IPO Deferred Amid Market Volatility

In March, PhonePe announced that it had deferred its proposed $1.3 billion initial public offering (IPO), citing pricing concerns, volatile market conditions and geopolitical tensions.

Earlier, the company had reportedly attracted investor interest for an IPO valued at around $7 billion, roughly 50% below its last implied valuation.

The subdued pricing expectations from prospective investors, including mutual funds, along with volatility linked to the US-Iran conflict, contributed to the decision, as per ET.

Several recently listed new-age companies had also reduced issue sizes and accepted lower valuations amid changing investor sentiment.

Brokerage Bernstein said in a February note that PhonePe remains behind rival Paytm in monetising its business despite comparable margins.

According to the brokerage, PhonePe's revenue of around ₹4,000 crore during the first half of FY26 was similar to Paytm's despite its relatively limited presence in lending and other non-payments businesses.

Bernstein also said regulatory measures affecting real-money gaming apps and credit card rent payments had reduced PhonePe's revenue by around 15%, with the impact likely to persist.

In contrast, Paytm reported a 22% increase in FY26 revenue to ₹8,437 crore and posted a net profit of ₹552 crore, compared with a loss of ₹663 crore in FY25.