Indonesian superapp provider GoTo reported a widened loss of 40.4 trillion rupiah ($2.6 billion) for 2022, a 56% increase from its 25.9 trillion rupiah net loss in 2021.
However, that loss isn’t because GoTo isn’t making money. GoTo’s 2022 revenue doubled to 11.3 trillion rupiah, up from 5.2 trillion rupiah the previous year.
The company’s net revenue saw a remarkable expansion to 3.4 trillion rupiah, signifying the resilient demand of consumers in Southeast Asia as they carried on shopping, booking rides, and ordering takeout despite rising costs of goods and services, Bloomberg reported.
GoTo has cash
Nathan Naidu, an analyst at Bloomberg Intelligence, pointed out that GoTo’s cash is now set to last 10-12 quarters, up from five quarters previously. The significant improvement in the company’s finances resulted from cost reduction initiatives, which helped GoTo achieve its goal of becoming cash flow positive without the need for additional external funding.
GoTo attributed the extended net loss to several factors, including restructuring costs and goodwill impairment related to the merger of Gojek and Tokopedia.
CEO Andre Soelistyo noted that 2022 was a year that changed the company’s thinking and operations. He also expects GoTo to achieve positive adjusted EBITDA in the fourth quarter of this year, with an adjusted EBITDA loss of 5.3 trillion rupiah to 4.6 trillion rupiah for this year.
Investors remain nervous
However, GoTo’s shares fell by 4.4 to 7% before the earnings announcement, reflecting investors’ cautious stance toward tech company profitability. GoTo had already laid off 600 employees this month, following a previous cut of 1,300 employees in November.
Since going public in April 2022, GoTo’s stock has plummeted by more than 70%, and the company will have to continue its focus on profitability if it wants to compete with other tech giants in the region. At the same time, however, the focus on profitability could leave GoTo vulnerable to higher outlays by the competition, according to the Wall Street Journal.
But GoTo is not alone in its focus on profitability, with other tech companies from the region such as Sea Ltd. taking the same approach. Early this month, Sea Ltd turned profitable for the first time.