Shares of Grab (NASDAQ:GRAB) fell 13% on Thursday after the Singaporean tech company warned that second-half GMV growth would be weaker and reduced its full-year revenue projection to the upper end of the previously stated range.
In the second quarter of 2022, Grab’s earnings per share of -$0.15 were below Wall Street expectations. Revenue surpassed projections and increased significantly, reaching an all-time high of $321M (+79.3% Y/Y), driven by the mobility and logistics sectors.
Recovery in the mobility segment and ongoing growth in deliveries shored up the total GMV’s 30% Y/Y growth. Additionally, Monthly Transacting Users (MTUs) rose 12% to 32.6M.
Due to continuous efforts to manage incentive spending, adjusted EBITDA margins increased sequentially by 136 basis points from negative 6.0% in the first quarter of 2022 to negative 4.6%.
According to CFO Peter Oey, “In the quarter, we moved to simplify our organizational cost structure. We cut back on underperforming business lines, reduced fixed expenditures, and tapered rewards as a percentage of GMV. We are moving up the breakeven points for our core food and total delivery segments as a result, and we are also limiting our 2022 revenue forecast to the upper end of our previously stated range. Due to our cost-cutting efforts and strategy for sustainable growth, we saw slower GMV growth in the second half but improved EBITDA compared to the first half.
GMV is projected to increase by 21% to 25% year over year, down from 30% to 35% before, while revenue is anticipated to increase by $1.25B to $1.3B (consensus: $1.25B), above the previously provided forecast of $1.2B to $1.3B.
Grab contests market share with GoTo
According to Bloomberg, Grab Holdings Ltd., formerly Southeast Asia’s most valuable company, is struggling to catch up to GoTo Group in the stock market as it competes to expand on the territory of its Indonesian ride-hailing rival.
Grab was supposed to reveal second-quarter earnings on Thursday before US markets opened, but GoTo will do so on August 30.
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Author Jowi Kwasu 
