Indonesia’s GoTo narrows losses and on track

Indonesia’s biggest tech firm GoTo on Tuesday said it had slashed underlying losses in the second quarter to US$78.25 million, down from $280 billion a year earlier, helped by intense cost-cutting measures.

GoTo, backed by Japan’s SoftBank Group and Singapore’s sovereign wealth fund GIC, has implemented various cost-cutting measures including layoffs this year, as it lost three-quarters of its market valuation since it went public in April last year.

Group CEO Patrick Walujo said that GoTo, which offers ride-hailing, e-commerce, and financial services, will continue its “cost discipline” measures while expanding its customer base.

“We are developing a long-term strategy for achieving this, and in the meantime we will continue to operate with absolute cost discipline as we pivot our product mix towards the mass market,” Walujo, who took the top job in June, said in a statement.

The company kept its target to swing to a profit by the end of this year.

Following positive results for the first half, GoTo revised its 2023 adjusted EBITDA outlook to a loss of between $293.8 billion and $248.1 billion, from a previously forecast loss of between $346 billion and $300.3 billion.

Net revenues for the second quarter of 2023 rose to $236 million, up 86.7 percent from 2022, with the company’s overall gross transaction value reaching $9.3 trillion, it said.

The company said it had slashed losses by 48 percent for the first half compared to a year earlier.

Its e-commerce business Tokopedia was Indonesia’s second-largest online marketplace last year, according to industry data, but faces intensifying competition as smaller rivals, led by TikTok, doubles down in the Southeast Asia’s biggest economy.

Shares in GoTo, shorthand for GoTo Gojek Tokopedia, closed up 6.59 percent to $0.0067 per share before the earnings announcement.