Indonesia’s GoTo More Than Doubles Half-Year Net Loss; Takes Over Crypto Firm

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Indonesia’s biggest e-commerce company GoTo on August 30 posted a half-year net loss of 14.17 trillion rupiah ($955 million), more than double compared with the loss of 6.62-trillion rupiah it recorded in the same period last year.

The tech firm, which was created from the merger between ride-hailing operator Gojek and e-commerce portal Tokopedia in May last year and went public at the Jakarta Stock Exchange in April this year, raising $1.1 billion, reported gross revenue of 10.73 trillion rupiah in the first six months of 2022, up from 7.2 trillion rupiah a year ago.

Gross transaction value reached 290.53 trillion rupiah in the period, compared with 204.25 trillion rupiah in the first half last year.

Gross revenue growth

The company stated that the revenue and transaction value growths were driven by “ongoing monetisation efforts,” which included updated merchant commissions for e-commerce, improved food delivery commissions and continued recovery in transport.

“We saw strong growth in our total gross transaction value and gross revenues, as well as continued improvements in our margins quarter-on-quarter, accelerating our path to profitability,” GoTo’s CEO Andre Soelistyo said in a statement.

Targeting “high-quality users”

He noted that the company’s strategy to move away from subsidy-driven incentives to product-led differentiation was working as it has increased user engagement among cross-platform customers and allowed the company to heighten its focus on cultivating high-quality users.

GoTo Group’s CFO Jacky Lo said the results of the first half of 2022 showed “sustainable revenue growth,” while the cost structure is being “optimised.”

“Moderate spending”

Looking ahead, the company says it will continue to moderate spending and expects “promising results” from investments in cross-platform and ecosystem integration.

But still, GoTo seems to have heavy financing needs as it is seeking to raise about $1 billion through a convertible bond issue, Reuters cited insiders. Reportedly, the company is working with three financial advisers for the offering which is expected to launch in the fourth quarter this year.

Takeover of crypto platform

In another development, GoTo is getting into the cryptocurrency business in an aim to diversify its services with the purchase of local crypto exchange Kripto Maksima Koin.

GoTo said in a statement on August 29 that it acquired 100 per cent of Kripto’s shares for 124.84 billion rupiah ($8.4 million). The purchase was part of its plan to turn itself into “a diverse money management hub,” it added.

“We believe that blockchain technology may play a mainstream role in the future of finance,” GoTo said.