1. Startups

Income Grab Soaring 24%, Company Increases Annual Profit Estimates

Grab posts Q1 2024 revenue of $653 million, optimistic annual profit can increase

Grab Holdings raised its annual profit forecast after Q1 2024 revenue rose 24% to $653 million, topping analyst estimates. This growth was driven by cost reductions and strong demand for services ride hailing and food delivery -- grew 27% and 19% respectively.

A major restructuring in 2023, including 1000 job cuts and technology cost cuts, helps the company achieve positive cash flow. CFO Grab Peter Oey stated that the surge in tourism in Southeast Asia strengthened demand for services ride-hailing.

Grab it now expects adjusted core profit of between $250 million to $270 million this year, up from its previous estimate of $180 million to $200 million. Annual revenue projections remain unchanged at $2,70 billion to $2,75 billion.

The company also disclosed a $97 million buyback of Class A shares, part of a $500 million buyback plan announced in February.

Co-founder and CEO Grab Anthony Tan stated that their focus on product growth paid off, with demand GMV increasing despite the impact of seasonality in the first quarter. The increased affordability and reliability of their services also attracts more users and increases the frequency of orders.

Stock Grab U.S.-listed companies rose 2% in after-hours trading, following results announced hours after markets closed. Although shares are still down about two-thirds since Grab go public by the end of 2021, the company believes that new initiatives such as digital banking will increase revenue in the future.

With these strategic steps, Grab hopes to continue to drive growth and strengthen its position as a market leader in Southeast Asia.

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Disclosure: This article was produced with AI technology and supervision of the content writer
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