Grab says delivery business softening, still ‘laser focused’ on profitability


The Grab logo is displayed at the Money 20/20 Asia FinTech trade show in Singapore on March 21, 2019. REUTERS/Anshuman Daga

Aug 25, 2010 Singapore’s Grab Holdings Ltd cut its full-year gross merchandise volume (GMV) outlook on Thursday, blaming a stronger greenback and slowing demand for takeaways as consumers return to dining out.

US-listed Grab shares were down 16 percent in early trading.

Yazu and his peers have seen huge gains as consumers rely on ordering food stuck at home during the pandemic. But as restrictions ease across much of Southeast Asia, consumers are stepping out to get their hands on the food.

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“What we’ve been seeing with some of the growth trends and consumer behavior has come to fruition,” CEO Anthony Tan told analysts.

“Customers want to save money … they may choose to order groceries to cook for themselves.” Tan added that Grab could benefit from its grocery delivery business.

The company, which operates in 480 cities across eight countries in Southeast Asia, raised the low end of its revenue forecast for the year, saying it was laser-focused on driving demand in Southeast Asia.

Tan said the company now plans to focus on launching new products that will help Grab focus on “profitable loyal customers” and lower the cost of serving users.

He also expects the rideshare business to pick up again when economies reopen.

To cut costs, Grab says it will attract drivers and users, exit unprofitable businesses such as “dark stores” in some countries, and slow hiring.

The company forecast revenue of $1.25 billion to $1.3 billion for the year, compared with $1.2 billion and $1.3 billion previously.

Maintain GMV growth between 21% and 25% for the year. On a constant currency basis, GMV is expected to grow between 25% and 29%, compared to the previous range of 30% and 35%.

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Reporting by Nivedita Balu in Bengaluru; Edited by Krishna Chandra Elluri

Our standards: The Thomson Reuters Trust Principles.



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