Key Highlights

• 4Q23 Group Adjusted EBITDA¹ turned positive to Rp 77 billion from -Rp 3.1 trillion in 4Q22 — the eighth consecutive quarter of improvement

• Full year 2023 Group Adjusted EBITDA¹ exceeded guidance as losses narrowed by 77% to -Rp 3.7 trillion

• 4Q23 gross revenue² improved by 3% YoY and 8% QoQ to Rp 6.5 trillion

• Group GTV³ increased by 8% QoQ and 1% YoY, reaching Rp 163.0 trillion – the second consecutive quarter of sequential growth

• Incentives and product marketing decreased by 33% YoY in 4Q23 and 38% for the full year, reflecting savings of Rp 1.7 trillion and Rp 9.0 trillion, respectively

• Company plans share buyback initiative of up to US$200mn, subject to regulatory and shareholder approval. 

Jakarta, Indonesia, March 19, 2024 – PT GoTo Gojek Tokopedia Tbk (IDX: GOTO, “GoTo Group'' or the “Company”), the largest digital ecosystem in Indonesia, today announced its 2023 fourth quarter and full year financial results. Group Adjusted EBITDA¹ turned positive for the first time at Rp 77 billion for the fourth quarter, while Group GTV³ for the quarter grew at 8% QoQ and 1% YoY, with gross revenue² increasing 8% QoQ and 3% YoY to Rp 6.5 trillion in 4Q23. These improvements were spurred by product innovations that address broader market segments as well as disciplined cost management. 

The company also agreed a strategic partnership with TikTok. Tokopedia and TikTok’s e-commerce businesses have been combined under the PT Tokopedia entity, which is now jointly owned by GoTo and TikTok as strategic partners in Indonesia, with TikTok holding a controlling stake. As part of the agreement, which was completed in January 2024, TikTok will invest over US$1.5bn in the enlarged entity over time without additional dilution to GoTo. GoTo will also receive an ongoing revenue stream from Tokopedia commensurate with its scale and growth. 

Furthermore, as cash flow continues to improve, the Company will optimize its capital usage in line with a newly developed capital allocation plan, which may include a share buyback initiative of up to $200m subject to regulatory and shareholder approval at the next Annual General Meeting of Shareholders (AGMS). The Company’s Board of Directors and Board of Commissioners will review the buyback program periodically, and may make amendments on an ongoing basis. More details on this plan will be disclosed in accordance with the regulatory process.

Patrick Walujo, GoTo Group CEO, said: “GoTo has established a solid operational base, achieving adjusted EBITDA profitability in Q4 2023 and forming a strategic partnership with TikTok in the e-commerce domain, which will expand into Financial Technology and On Demand Services. Looking ahead, our focus is on strengthening this base to foster accelerated, profitable growth.”

“We will do this by staying true to our mission, which extends to enriching our customers’ experience and making our products and services accessible to a broader audience. Our approach is centered on continuous product innovation and operational excellence, as we aim to increase the value we offer to existing customers, expand our wallet share, and grow our customer base. We will double down on successful strategies that help us achieve this, while exploring innovative new ventures, and discontinuing any initiatives that are non-scalable.”

Jacky Lo, GoTo Group CFO, said: “Profitability improved in each of our segments in the fourth quarter year-on-year. On-demand Services was Adjusted EBITDA positive for the quarter, and our Financial Technology business sustained its rapid expansion while still maintaining year on year and quarter on quarter improvements in Adjusted EBITDA. E-commerce also achieved positive Adjusted EBITDA for the quarter amid a challenging competitive environment, and is set to become a cash-accretive segment for the Company  through our agreement with TikTok. We expect to achieve Group Adjusted EBITDA breakeven for the full year 2024, while at the same time reinvesting profits upside back into the business in a sustainable manner as we continue to drive top line growth.”

4Q23 Group incentive spend was reduced by 33% YoY, resulting in a 38% reduction for the full year, while cash recurring fixed costs decreased by 39% YoY in the fourth quarter, and 19% for the year, as Group Adjusted EBITDA losses for 2023 were reduced by 12.3 trillion Rupiah. 

GoTo maintains a solid cash position and balance sheet. As of December 31st, the Company had IDR 27.4 trillion or USD 1.8 billion in cash, cash equivalents, and short-term time deposits. Following the deconsolidation of Tokopedia effective on February 1st, these balances would amount to approximately IDR 23.0 trillion or USD 1.5 billion. The Rp4.4 trillion difference is predominantly due to cash in escrow accounts that hold temporary funds from Tokopedia merchant transactions. These accounts were rightly transferred back to Tokopedia as part of the deconsolidation.

Group Highlights

4Q23 Group Adjusted EBITDA improved to Rp 77 billion, or 0.05% of GTV, from -Rp 942 billion in 3Q23 and -Rp 3.1 trillion in 4Q22. Group Adjusted EBITDA also improved for the full year to -Rp 3.7 trillion, exceeding the upper end of the Company’s guidance range of -Rp 4.5 to -Rp 3.8 trillion that was previously announced on the 2Q23 earnings call on 15 August 2023.

Group GTV was Rp 163.0 trillion, an increase of 8% QoQ and 1% YoY, primarily driven by the Company’s focus on the mass market segment. Group GTV declined by a modest 1% for the full year, attributable to reduced incentives and product marketing in 2023. 

The Group maintained positive YoY gross revenue growth of 3% by addressing larger segments of the market, and improving the consumer lending business. Overall take rate for the Group was stable QoQ at 4.0% in 4Q. Group take rate for the full year of 2023 increased by 26 basis points YoY to 4.0%. Net revenue for 4Q23 was Rp 4.3 trillion, an increase of 18% QoQ and 26% YoY.

Incentives and product marketing spend was reduced by 33% YoY in 4Q23 and 38% for the full year, reflecting savings of Rp 1.7 trillion and Rp 9.0 trillion, respectively. Cash recurring fixed costs decreased by 18% QoQ and 39% YoY in the fourth quarter, and 19% for the full year. Recurring cash corporate costs in the fourth quarter were Rp 238 billion - a decrease of 12% QoQ and 42% YoY. These are among the lowest in the industry, with potential for further savings going forward. 

Corporate costs are allocated to each business segment, to be directly attributed. In the fourth quarter approximately 60% of recurring cash headquarter corporate costs - equivalent to Rp 137 billion - were allocated to the relevant business segments.

Business efficiencies have enabled the Group to book a 66% reduction in FY2023 operating loss, which reached -Rp 10.3 trillion, compared to -Rp 30.3 trillion the previous year. Similarly, the operating loss for 4Q2023 was -Rp 1.5 trillion, a reduction of 80% from the same period in 2022.

The Group booked a net loss of -Rp 90.5 trillion for the full year. This was driven primarily by a Rp 78.8 trillion goodwill reversal as required by prevailing accounting standards, brought about by the Tokopedia and TikTok transaction that resulted in loss of control of Tokopedia starting February 1, 2024. The loss due to reversal of goodwill is non-recurring and non-cash in nature, and has no impact on the company’s Adjusted EBITDA and cash flow. 

On-Demand Services

In On-demand Services, the Company continued to reduce the cost to serve, while expanding key products to more cities in order to attract mass market users while maintaining driver-partners' income. This strategy is generating an increase in new users, while also reactivating dormant users.

• Adjusted EBITDA for On-demand Services turned positive in 4Q23 reaching Rp 239 billion, or 1.71% of On-demand Services GTV. On-demand Services also reported positive operating segment profit in 4Q23. 

• Gross revenue increased 7.2% QoQ in 4Q23 to Rp 3.2 trillion driven in part by value-added services and increased advertising revenue, which increased On-demand Services take rate by 66 bps QoQ. For the full year, gross revenue increased by 4% YoY, as On-demand Services increased its take rate by 270 bps. 

• Incentive and product marketing spend for On-demand Services declined by 21% YoY in 4Q23, while Cash Recurring Operating Expenses were reduced by 37% YoY.

• On-demand Services GTV improved by 4% QoQ to Rp 14.0 trillion. This marks the second consecutive quarter of GTV improvement, as On-demand Services regains growth momentum. Full year GTV declined by 9% YoY due to reduced incentives in 2023.

• The Company’s affordable transport product was rolled out in more cities, increasing its GTV by 20% in Q423. Approximately 40% of users during the period were new or previously inactive.

• The Company’s food subscription offering continues to grow, with user spending, and frequency approximately three times higher for subscribers versus non-subscribers.

• The Company will further expand its value-added ODS products in 2024, to deepen wallet share,  while continuing to scale and broaden the reach of its offerings for mass market users.

E-Commerce

In December 2023, GoTo and TikTok announced a strategic partnership that would see the Tokopedia platform and TikTok’s e-commerce offering in Indonesia combined under PT Tokopedia, with TikTok holding a controlling stake. As part of the agreement, which was completed in January 2024, TikTok will invest over US$1.5bn in the enlarged entity over time without additional dilution to GoTo. GoTo will also receive an ongoing revenue stream from Tokopedia commensurate with its scale and growth. 

• Adjusted EBITDA for E-commerce turned positive at Rp 223 billion, or 0.34% of E-commerce GTV, driven by efforts in value-added services, advertising, and cost optimization, although the Company increased marketing to capture seasonal opportunities amid a challenging competitive landscape.

• Tokopedia reactivated select marketing and promotions to drive growth in the fourth quarter. E-commerce GTV therefore improved by 5% QoQ and declined 8% YoY in 4Q23, reaching Rp 65.3 trillion, primarily driven by increased sales in digital goods, cars and motorcycles. Core GTV, which excludes these verticals, declined by 26% YoY. 

• In January 2024, GoTo completed its transaction with TikTok, merging the Tokopedia platform with TikTok’s e-commerce offering. The business is now cash accretive for GoTo as a result of an e-commerce fee the Company will receive each quarter, commensurate with the scale and growth of the enlarged Tokopedia business.

• TikTok has committed to investing over US$1.5 billion in the enlarged entity over time without additional dilution to GoTo.

• GoTo continues to work diligently with regulators and TikTok to achieve compliance while ensuring a smooth transition that will allow consumers to continue to shop seamlessly. This is on track to be completed within the trial period.

Financial Technology

The Financial Technology business has seen strong topline growth driven by the introduction and rapid adoption of new products that appeal to users inside and outside of the GoTo ecosystem. These include the award-winning GoPay app and the newly-launched GoPay savings product. The lending business also continues to be a priority, and is also growing at a healthy rate, with the consumer lending loan book increasing by 32% QoQ.

• Adjusted EBITDA for Financial Technology improved by 77% YoY and 57% QoQ in 4Q23 to -Rp 168 billion, or -0.16% of Financial Technology GTV. The improvement was driven by revenue growth and a reduction in incentives.

• Gross revenue for Financial Technology increased 26% YoY and 34% QoQ in 4Q23 to Rp 605 billion, driven by growth in lending and consumer payments.

• Financial Technology GTV was Rp 103.2 trillion in 4Q23, increasing by 9% QoQ and 5% YoY. GTV excluding merchant payment gateway grew at 18% QoQ and 8% YoY

• Recurring cash operating expenses decreased by 19% QoQ and 35% YoY in 4Q23 based on cost optimization. As GoTo continues to scale its lending business, costs are expected to fluctuate.

• Outstanding loans generated from GoTo’s consumer lending business, consisting of its BNPL and cash loan offerings, grew by 32% QoQ to Rp 1.9 trillion as of 4Q23. Credit quality remains healthy with NPL more than 90 days past due at 1.3% as a percentage of the total consumer loan book in December. 

• Over 70% of GoTo’s loan book was channeled by Bank Jago in the fourth quarter, increasing from under 60% in the third quarter. The companies will continue to collaborate to scale GoTo’s loan origination in 2024.

• The GoPay app, which had been downloaded over ten million times by the end of December⁵, received three awards from Google Play - Best App in 2023, Best Everyday Essentials App and the Users’ Choice App in Indonesia. 

Logistics

GoTo Logistics continued to drive down delivery costs for consumers as well as sellers. Efficiency was steadily increased by utilising in-house deliveries in densely populated areas and low-cost third-party services elsewhere.

• Adjusted EBITDA was -Rp 114 billion, flat QoQ.

• Gross revenue was Rp 518 billion, a 2% QoQ decrease mainly driven by lower volumes from E-commerce due to the rationalization of incentives.

Environmental, Social and Governance (ESG)

GoTo is committed to social responsibility and best practices in its ESG performance. Outcomes from the Company’s efforts in 4Q23 include:

• Receiving validation of its net-zero targets from the Science Based Targets Initiative (SBTi), becoming the first-public company in Indonesia to have targets validated by SBTi.

• Quadrupling the size of its two-wheel (2W) electric vehicle fleet and expanding the GoRide EV service to parts of Central, West, and North Jakarta.

• Becoming the first in the industry to launch accessibility contrast (high-contrast and dark) modes in all three of GoTo’s consumer apps, to support visually impaired users

• The installation of paper shredder machines in all Dilayani Tokopedia (GTL) warehouses to accelerate repurposed waste carton initiatives.

Company Outlook

GoTo expects to capture additional growth in broad user demographics in its core segments more cost-effectively across the expansive Indonesian market by leveraging its unique ecosystem that spans the full range of consumer spending.

The Company currently expects:

• Full-year 2024 Group Adjusted EBITDA¹ breakeven.

The above outlook is based on current market conditions and reflects the Company’s preliminary estimates, which are all subject to various uncertainties and risks. These include increasing market competition, which is expected to continue over future quarters, as well as cost inflation and other variables.

- END -

About GoTo Group

GoTo is the largest digital ecosystem in Indonesia. GoTo's mission is to ‘empower progress' by offering technology infrastructure and solutions that help everyone to access and thrive in the digital economy. The GoTo ecosystem provides a wide range of services including mobility, food delivery, groceries and logistics, as well as payments, financial services, and technology solutions for merchants. The ecosystem also provides e-commerce services through Tokopedia and banking services through its partnership with Bank Jago.

Forward-Looking Statements

This document may contain forward-looking information or forward-looking statements including, but not limited to discussions of strategy, future plans and indicative financial performance (collectively, “forward-looking information”). All information contained in this document that is not clearly historical in nature or that necessarily depends on future or subsequent events is forward-looking information prepared as of the date of this document  is based upon the opinions and estimates of management as well as the information available to management as of the date of this document. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "expect", "likely", "may", "will", "should", "intend", "anticipate", "potential", "proposed", "estimate" and other similar words, expressions and phrases, including negative and grammatical variations thereof, or statements that certain events or conditions "may,” or "will" happen, or by discussion of strategy. 

Forward-looking information is based upon a number of current internal expectations, estimates, projections, assumptions and beliefs that, while considered reasonable by management, are inherently subject to significant business, economic, competitive and other uncertainties and contingencies. Forward-looking information is not a guarantee of future performance and involves known and unknown risks, uncertainties and other factors (including the risks and uncertainties in the Company’s consolidated financial statements and Management’s Discussion & Analysis available on the Company’s website), that may cause actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by such forward-looking information. Any estimates, investment strategies or views expressed in this document are based upon current market conditions, and/or data and information provided by unaffiliated third parties, and are subject to change without notice. To the extent any information in this document was obtained from third party sources, the Company has not independently verified that information, and there is a risk that the assumptions made and conclusions drawn by the Company based on such information are not accurate. Except as required by law, the Company disclaims any obligation to update or revise any forward-looking information, whether as a result of new information, events or otherwise. Readers are cautioned not to put undue reliance on this forward-looking information and should not be viewed, in and of itself,  as any basis for making any investment decision.

Non-IFAS Financial Measures

GoTo Group uses the following non-Indonesian Financial Accounting Standards (IFAS) financial measures including gross revenues, contribution margin and adjusted EBITDA, to understand and evaluate GoTo Group’s core operating performance. However, the definitions of GoTo Group’s non-IFAS financial measures may be different from those used by other companies, and therefore, may not be comparable. Furthermore, these non-IFAS financial measures have certain limitations in that they do not include the impact of certain expenses that are reflected in GoTo Group’s consolidated financial statements that are necessary to run GoTo Group’s business. Thus, these non-IFAS financial measures should be considered in addition to, not as substitutes for, or in isolation from, measures prepared in accordance with IFAS. 

Non-IFAS measurements are not intended to replace the presentation of GoTo Group’s financial results in accordance with IFAS. Rather, GoTo Group believes that the presentation of Adjusted EBITDA provides additional information to investors to facilitate the comparison of past and present results, excluding those items that GoTo Group does not believe are indicative of GoTo Group’s ongoing operations due to their size and/ or nature. In addition, GoTo Group also presents the Contribution Margin, which may provide additional information to investors in relation to the results excluding non-variable expenses and other income/expenses. Contribution margin and adjusted EBITDA presented herein may not be comparable to similarly entitled measures presented by other companies, who may use and define this measure differently. Accordingly, you should not compare these non-IFAS measure to those presented by other companies.

Consolidated Financial Information

GoTo Group furnished the result for the year ended December 31, 2023 and 2022. The information for the year ended December 31, 2023 is extracted from the consolidated financial statements of the Company as of and for the year ended December 31, 2023 (with consolidated financial information as of and for the year ended December 31, 2022as comparative)  that has been audited by the Public Accountant  in accordance with the auditing standards established by Indonesian Financial Accounting Standards with an unmodified opinion dated March 18, 2024. 

Furthermore, in this document, GoTo Group also furnished the results of the three months ended December 31, 2023, September 30, 2023, June 30, 2023,  March 31, 2023 and December 31, 2022 which have been prepared by and are the responsibility of management. The consolidated financial information for the three months ended December 31, 2023, September 30, 2023, June 30, 2023,  March 31, 2023 and December 31, 2022 have not been audited, reviewed, examined, or applied any procedures on. Accordingly, there are no opinions or any other form of assurance expressed with respect to any and all consolidated financial information for the three months ended December 31, 2023, September 30, 2023, June 30, 2023,  March 31, 2023 and December 31, 2022 presented in this document.

¹ GoTo Group calculates the Adjusted EBITDA, a non-IFAS financial measure, beginning with loss before income tax and adjusting for (i) depreciation and amortization expenses; (ii) finance income; (iii) interest expenses; (iv) loss on impairment of assets of disposal group classified as held for sale; (v) (reversal)/loss on impairment of investment in associates and joint ventures; (vi) loss on goodwill; (vii) fair value adjustment of financial instruments; (viii) loss on impairment of intangible and fixed assets; (ix) share-based compensation cost (including for the Gotong Royong Program); (x) unrealised foreign exchange (gain)/loss from cash remeasurement; (xi) share of net losses in associates and joint ventures; (xii) (gain)/loss on divestment and dilution of investment in associates and joint ventures, net (xiii) dividend income; and (xiv) non-recurring items. 

²Gross revenue represents the total Rupiah value attributable to GoTo Group from each transaction, without any adjustments for incentives paid to driver-partners and merchant partners or promotions to end-users, over the period of measurement. For a reconciliation of net revenue to gross revenue, please refer to the section “Non-IFAS Financial Reconciliation.”

³ GTV means gross transaction value, an operating measure representing:

1. the sum of the time value of the transactions from On-demand Services.

2. the sum of the value of the product and services recorded on our E-commerce Segment.

3. the sum of the total payments volume, or TPV processed through our platform of Financial Technology Services.

4. and excluding amounts from inter-Company transactions between entities within the Company that are eliminated upon consolidation. 

⁴ GoTo Group calculates the contribution margin, a non-IFAS measure, beginning with net revenue and deducting total cost of revenues, a portion of sales and marketing expenses relating to the promotional excess and product marketing and others consists of mainly withholding taxes related to sales and marketing expense and other insignificant expenses. 

⁵ Source: Data.ai

Contacts:

Media

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