GoTo Group narrowed quarterly losses after reducing expenses and doubling net sales, taking another step toward reassuring investors who have wiped out 70% of its market value since a 2022 initial public offering.
(Bloomberg) — GoTo Group narrowed quarterly losses after reducing expenses and doubling net sales, taking another step toward reassuring investors who have wiped out 70% of its market value since a 2022 initial public offering.
The Indonesian car-hailing and internet services firm reported an adjusted loss before interest, taxes, depreciation and amortization of 1.6 trillion rupiah ($109 million) in the quarter ended March, from 4.9 trillion rupiah a year earlier, the Jakarta-based company said Thursday.Â
Net revenue, which strips out incentives to driver and merchant partners and promotions to users, more than doubled to 3.3 trillion rupiah. GoTo is benefiting from a broad-based rebound in ride-hailing and higher take rates in its e-commerce arm despite a cost-of-living squeeze.
GoTo, formed through a merger of ride-hailing provider Gojek and e-commerce firm Tokopedia, has narrowed losses steadily through layoffs, shelving promotional spending and tight expense controls. Like its Southeast Asian peers Grab Holdings Ltd. and Sea Ltd., GoTo is trying to convince investors of its profit-making potential. Following years of rapid growth, the company has turned its focus on the bottom line, though uncertainty persists about elevated inflation and the global economic outlook.
GoTo cut 600 roles from its workforce last month, adding to the 1,300 jobs it axed in 2022. The company said the cuts helped it reduce monthly fixed expenses by about 20% in January and February and slashed marketing spending. In February, it brought forward its target for making profits by a year, expecting adjusted Ebitda to turn positive in the fourth quarter of 2023.
Indonesia Tech Giant Accelerates Profit Goal After Job Cuts
Net loss narrowed to 3.9 trillion rupiah in the first quarter, from 6.6 trillion rupiah a year earlier, helped by the drastic cost cuts it implemented since 2022.Â
Even as the challenging economic outlook threatens to leave consumers with less to spend on shopping, entertainment, food delivery and ride-hailing, GoTo and its internet peers are betting on online services gaining ground. Singapore’s Sea reported its first-ever profit last quarter, which came earlier than expected and marked a significant turning point for the company.
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