Skip to main content

Featured Post

Market Daily Report: Bursa Malaysia Ends Higher In Line With Most Regional Markets

KUALA LUMPUR, Sept 20 (Bernama) -- Bursa Malaysia ended higher on Friday in line with most Asian markets, mirroring gains from Wall Street, where investors welcomed the US Federal Reserve's substantial interest rate cut. The FTSE Bursa Malaysia KLCI (FBM KLCI) rose by 3.17 points, or 0.19 per cent, to 1,668.82 at the close from Thursday's close of 1,665.65. It opened 5.03 points higher at 1,670.68, trading between 1,668.48 and 1,674.04 throughout the session. In the broader market, gainers outpaced decliners 732 to 468, while 465 counters were unchanged, 850 untraded and 32 suspended. Turnover swelled to 4.19 billion units worth RM5.97 billion, from Thursday's 3.99 billion units worth RM4.08 billion. UOB Kay Hian Wealth Advisors head of investment research, Mohd Sedek Jantan, noted the FBM KLCI's gains were led by utilities, logistics, and banking stocks, reflecting improved market sentiment. Additiona
Post a Comment

GoTo’s Loss Narrows Sharply After TikTok Deal Boosts Bottom Line

 

 GoTo Group, an Indonesian company, reported a significantly narrower quarterly loss after transferring its e-commerce business to TikTok, reducing costs and focusing on its primary ride-hailing service.

The company, competing with Singapore’s Grab Holdings Ltd in ride-hailing and food delivery, posted an adjusted loss of 48 billion rupiah (RM13.58 million) before interest, taxes, depreciation, and amortization (Ebitda) for the three months ending June. This compares to a pro forma loss of 885 billion rupiah a year earlier.

GoTo is concentrating on profitability as user growth slows and competition from Grab and smaller regional rivals affects margins. To improve its financials, GoTo handed over its loss-making e-commerce arm, Tokopedia, to ByteDance Ltd’s TikTok in a US$1.5 billion (RM6.93 billion) deal. As part of the agreement, GoTo receives regular payments from TikTok, contributing a net 157 billion rupiah in fees for the second quarter. The company reiterated its expectation to break even on an adjusted Ebitda basis for the full year.

Despite stiff competition and shaky consumer spending, GoTo's second-quarter net revenue rose 115% on a pro-forma basis to 3.5 trillion rupiah, driven by increased spending on budget-friendly products. The company is also investing in AI, releasing its first feature — a voice assistant — earlier this month.

However, GoTo has yet to achieve profitability on a net income basis, despite significant job cuts and reductions in marketing spending. Since Patrick Walujo became CEO last June, the company has moved closer to profitability, although its shares have roughly halved.

While the TikTok deal and cost reductions are set to ease financial pressure, the challenging market has led GoTo and its competitors to consider aggressive strategies. GoTo and Grab have revived discussions about merging their core businesses, potentially reducing spending to attract users.

Key Takeaways:

  • GoTo's adjusted quarterly loss narrowed significantly after transferring its e-commerce business to TikTok.
  • The company reported a 48 billion rupiah adjusted loss, compared to 885 billion rupiah a year earlier.
  • GoTo expects to break even on an adjusted Ebitda basis for the full year.
  • Second-quarter net revenue rose 115% to 3.5 trillion rupiah.
  • The company is investing in AI and released a voice assistant feature.
  • Discussions about a merger between GoTo and Grab have been revived.
Labels:

Comments

Post a Comment

Popular posts from this blog

INTC Share Watch and News

Stock Info Market Monitor Company Profile Intel Corporation designs, manufactures, and sells integrated circuits for computing and communications industries worldwide. It offers microprocessor products used in notebooks, netbooks, desktops, servers, workstations, storage products, embedded applications, communications products, consumer electronics devices, and handhelds. The company also offers system on chip products that integrate its core processing functionalities with other system components, such as graphics, audio, and video, onto a single chip. It also provides chipset products that send data between the microprocessor and input, display, and storage devices, such as keyboard, mouse, monitor, hard drive, and CD or DVD drives; motherboards that has connectors for attaching devices to the bus, and products designed for desktop, server, and workstation platforms; and wired and wireless connectivity products, including network adapters and embedded wireless cards used to translat
1 comment
Read more

Analysts See Asset Resilience of Bank of Chengdu Benefiting Hong Leong Bank

Analysts predict that the asset quality of Bank of Chengdu, in which Hong Leong Bank Bhd holds a 19.76% stake, will remain robust due to its strict risk management policies and proactive measures. Key Takeaways: Strong Risk Management Practices : According to CIMB, Bank of Chengdu has adopted a conservative risk culture, performing thorough assessments of location, developer reputation, project viability, and management integrity before financing property projects. The bank closely monitors early warning signals like construction progress, sales progress, budget overruns, and fund usage by developers to mitigate potential risks. Proactive Measures Against Property Slowdown : The bank's precautionary measures allowed it to reduce exposure to problematic property loans and exit risky loans before China's property market slowdown. This conservative approach is expected to benefit Hong Leong Bank by minimizing potential asset quality concerns. Continued Optimism and Buy Recommendat
Post a Comment
Read more

Investors Keep Buying US Junk Debt Despite Weak Protections

  When US-based construction material supplier Wilsonart issued a junk bond to raise US$500 million (RM2.13 billion) for an acquisition this summer, a research firm warned potential investors about the bond's weak protections. The bond’s covenants could allow the company to move valuable assets to another entity and raise more money, potentially disadvantaging bond investors, according to Covenant Review , a research firm. This warning comes amid growing concerns in credit markets as more companies engage in practices like "liability management exercises," where they borrow more against the same assets. These practices, often favoring some creditors over others, have been dubbed "creditor-on-creditor violence," prompting some creditors to unite to protect their interests. Despite the warnings, investors eagerly purchased Wilsonart's offering, underscoring a paradox in US credit markets. While investors face the consequences of weak covenants, they continu
Post a Comment
Read more