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GoTo closer to profitability after letting go of Tokopedia
GoTo’s main rival Grab improved operational efficiency and achieved its first-ever net profit in the fourth quarter of last year.
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Gojek driver partners ride electric motorcycles as the ride-hailing platform's owner, GoTo, strives to deliver on its sustainability pledges. (GoTo/Henry)
T
he recent sale of a majority stake in Tokopedia could help local giant GoTo achieve profitability much sooner than initially projected.
Analysts believe the deal with social media platform TikTok will expedite GoTo’s path to profitably at a time when more tech investors are demanding a clear strategy for start-ups to reach financial sustainability.
Previously, they had projected the ride-hailing company to continue posting operating losses until 2026.
GoTo’s main rival, Grab, came out in the black for the first time ever in the fourth quarter (Q4) of last year after improving operational efficiency.
While that was attributed to a one-off event, analysts expect the Southeast Asian on-demand and fintech heavyweight to post a full-year profit as early as next year.
In Q4 2023, Grab booked US$653 million in revenue, a 30 percent increase compared with the same period in the previous year. At the same time, total incentives were further reduced from 8.2 percent of the gross merchandise value (GMV) to 7.3 percent.
The resulting net profit of $11 million compares to a net loss of $391 million in Q4 2022.
