Indonesian superapp provider GoTo on Monday said its 2022 net loss widened by 56% to IDR 40.4 trillion (USD 2.6 billion) as the company continues struggling to turn a profit.
GoTo, which listed in April 2022, suffered an IDR 25.9 trillion (USD 1.7 billion) net loss in 2021.
The Indonesian company attributed the extended net loss to several factors including an IDR 11 trillion (USD 728 million) goodwill impairment related to the business combination of Gojek and Tokopedia, which are both its units. Additionally, GoTo noted an increase in share-based compensation expenses due to an adjustment of the assumed employee turnover rate to reflect the latest historical trends and one-off restructuring costs.
Revenue for the most recent year, however, rose to IDR 11.3 trillion (USD 748 million), from IDR 5.2 trillion (USD 344 million) a year ago.
“2022 was undoubtedly a challenging year. But it was also an important inflection point,” group CEO Andre Soelistyo said during an earnings conference on Monday after the results were released. “It was a year that changed our thinking and showed us how we needed to operate.”
The company was formed in May 2021 through a merger of Gojek, a ride-hailing and food delivery service provider, and Tokopedia, a local e-commerce platform operator.
GoTo was among a raft of tech unicorns — startups valued at more than USD 1 billion — that had emerged in Southeast Asia before the pandemic. Others include Indonesia’s Bukalapak, a major e-commerce platform.
This year, the group expects the adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss to be in the range of IDR 5.3 trillion (USD 351 million) to IDR 4.6 trillion (USD 305 million). It also forecasts achieving positive adjusted EBITDA within the fourth quarter this year.
Global economic headwinds are now forcing many of the region’s high-flying tech companies to downsize their labor forces and prioritize profitability over growth. GoTo is no exception. This month it announced 600 layoffs. In November it trimmed its labor force by 1,300 employees, or 12%.
The company said the recent job cuts stemmed from a need to “create a more streamlined organization,” according to a statement issued on March 10.
Before the earnings announcement, GoTo’s shares on Monday morning dropped 4.4%, to IDR 108 (less than USD 0.01), well below their initial public offering price of IDR 338 (USD 0.02). GoTo’s market capitalization stood at IDR 127 trillion (USD 8.4 billion) as of Monday morning.
Tech companies shifting their focus to profitability was partially behind the collapse of Silicon Valley Bank in the U.S. earlier this month, an event that sent ripples through global financial markets. The sell-off ahead of GoTo’s earnings reflects investors’ guarded posture.