PayPay reported a 75% fall in net profit for the July to September quarter, to ¥18.4bn, but the comparison is distorted. The prior-year quarter included a one-off tax effect of ¥57.5bn from recognising deferred tax assets at PayPay, and the company said net profit rose once that effect is stripped out of the earlier figure.
The results are unaudited. They were summarised in an extraordinary report filed with the Kanto Local Finance Bureau on November 4, 2026, drawn from the company's US Form 6-K.
Revenue and volume
Operating revenue was ¥118.1bn, up 28% from a year earlier. The payments segment grew 27% and the financial services segment 38%.
Payments gross merchandise volume (GMV) rose 20% to ¥5.56tn, and payments segment revenue rose 27% to ¥96.7bn, faster than volume. The company attributed that to a higher take rate, which rose 0.1 percentage point to 1.74%. It cited a larger share of online payments, more interest income on credit-card balances and lower point costs after a June 2026 overhaul of its points programme.
PayPay said growth came despite a high comparison base, from a rush of demand in September 2025 before a rule change to furusato nozei hometown-tax donations, and despite long rains that hit offline payments, mainly in September 2026. Monthly transacting users rose 9% to 42.22mn.
Credit exposure
In financial services, revenue rose 38% to ¥22.9bn, mainly on higher interest income. PayPay Bank's loan balance rose 37% to ¥1.4tn, on housing, consumer and business loans, and deposits rose 16% to ¥2.4tn. Interest income rose 70%, helped by a higher policy rate.
Credit-card financial balances, covering revolving, instalment and cash-advance balances, grew 26%. Provisions for credit losses rose to ¥9.4bn in the quarter from ¥6.1bn a year earlier. Total transaction-related costs, which also include payment costs and interest expense, rose to 24% of revenue from 22%, a 1.3 percentage point increase.
Profit measures
Operating profit was ¥33.2bn against ¥20.5bn a year earlier. Adjusted EBITDA, a non-IFRS measure, rose 55% to ¥42.1bn, a 36% margin. Adjusted EBITDA is not net profit.
PayPay said payment costs rose 13%, slower than total GMV, which grew 20%, as it shifted to cheaper funding sources, including a July 2026 change affecting other companies' credit cards on PayPay.