ToneTag Doubles Revenue And Achieves Profitability In FY24 After Two Years Of Slow Growth

ToneTag, a contactless payment solution provider, has made a recovery after a period of slow growth in FY22 and FY23, as per media reports. The Bengaluru-based company has doubled its revenue in the fiscal year ending March 2024, recording a 111.7 per cent increase, with revenue reaching Rs 47.78 crore compared to Rs 22.57 crore in FY23, according to its financial statement sourced from the Registrar of Companies.

In addition to strong revenue growth, ToneTag has achieved profitability for the first time since its inception in 2014, posting a profit of Rs 20.94 crore in FY24, a significant turnaround from a Rs 6.12 crore loss in FY23. This was made possible by efficient cost-cutting measures that helped reduce total expenses by 9.3 per cent to Rs 26.95 crore, despite some cost increases in finance and telecommunications.

ToneTag offers three core product categories—voice commerce, online store, and in-store solutions—that help retail and F&B businesses enhance customer interactions through its Oyeti platform. The platform enables voice-powered shopping, ordering, and payment experiences, while the VoiceSe UPI payment service allows voice-based transactions without the need for an internet connection.

The company also generated Rs 30.87 crore in customization services during FY24, accounting for 64.6 per cent of total operating revenue. However, revenue from smart stores saw a decline of 53.8 per cent, dropping to Rs 10.33 crore compared to Rs 22.36 crore in the previous year. Other revenue streams included Rs 4.14 crore from monthly business fees, Rs 1.63 crore from one-time integration fees, and Rs 81 lakh from license fees.

On the expense side, employee benefits formed 49% of the company’s total expenditure, remaining largely stable at Rs 13.22 crore. However, finance costs surged over fivefold to Rs 2.49 crore, and telephone and IVR charges increased by 143.8 per cent to Rs 2.17 crore.

Despite these rising costs, ToneTag’s strategic focus on scaling its operations and controlling expenses led to its impressive profitability. The company’s operating cash outflows increased by 73.6 per cent to Rs 2.24 crore in FY24.

ToneTag, which is backed by major investors like Amazon, Reliance, and 3one4 Capital, is reportedly looking to raise USD 50 million in a mix of primary and secondary funding from Iron Pillar and other investors. The company has already raised over Rs 90 crore (USD 11 million) in total and was valued at Rs 800 crore ($96 million) during its last funding round, which took place over six and a half years ago.