Paytm cited its drive for a leaner structure and tech-led productivity gains as reasons for the job cuts, which helped reduce employee expenses by 21% to ₹2,473 crore in FY25 from ₹3,124 crore
One97 Communications, the parent company of Paytm, has undertaken a significant restructuring exercise, trimming its workforce by over 4,500 employees in the financial year 2024-25. This strategic move resulted in substantial cost savings of ₹650 crore, surpassing the company’s earlier estimate of ₹400-500 crore.
According to the company’s latest annual report released on August 6, the average employee headcount dropped from 44,000 in FY24 to 39,400 in FY25. Despite continued investments in expanding its sales network, the sales team headcount also saw a decline, falling from 35,512 to 32,614 over the same period.
Paytm attributed the reduction to its ongoing efforts to create a leaner organisation and enhance productivity through technology. Employee-related expenses, excluding stock-based compensation, were brought down by 21%, falling to ₹2,473 crore in FY25 from ₹3,124 crore in FY24.
Core business drives recovery
In a letter to shareholders, founder and CEO Vijay Shekhar Sharma acknowledged the difficult decisions taken during the year, including the divestment of non-core businesses. “We took some tough calls… and doubled down on our core of payments, ensuring the preservation and growth of our cash reserves,” Sharma noted, highlighting the company’s sharpened focus on sustainable growth.
The cost optimisation drive comes in the wake of regulatory restrictions placed on Paytm Payments Bank by the Reserve Bank of India in the final quarter of FY23. These constraints affected key offerings such as wallets, Fastags, and savings accounts, leading to disruptions in both payments and lending operations.
Despite these challenges, Paytm posted its first operational net profit of ₹123 crore in the June quarter of FY26, backed by robust lending growth and a 19% reduction in overall expenses. Revenue for the quarter rose 28% year-on-year to ₹1,918 crore, while EBITDA turned positive at ₹72 crore.
