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Yandex.Taxi expects profit in the second half of 2020

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Earnings Reports To Watch | The Week of February 15th, 2020

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Yandex.Taxi expects profit in the second half of 2020

Yandex.Taxi service, owned by internet giant Yandex, hopes to remain profitable in the second half of this year, despite a sharp drop in demand caused by restrictions due to the pandemic..

Yandex.Taxi expects profit in the second half of 2020

The corporation also owns a self-driving car project and a food delivery service, which accounted for almost 25% of all revenue in the first quarter..

Yandex.Taxi was preparing for an IPO in the first half of 2020 and has already hired three investment banks for this purpose, but the outbreak of the coronavirus has postponed this market event.

Russian President Vladimir Putin on Tuesday extended the isolation regime throughout the country until May 11, as part of the fight against the spread of the epidemic. Thus, many businesses will continue to operate remotely and citizens will avoid large crowds, thereby reducing the number of taxi rides..

Since the beginning of April, the volume of sales of taxi services in Moscow has decreased by 60% compared to the same period last year and by 70% in annual terms since the beginning of March, said Yandex.Taxi CEO. Daniil Shuleiko.

«We began to see a slowdown in growth in the second half of March due to concerns about the spread of COVID-19. If at the beginning of March we saw almost 5 million trips per day, then by the end of the month this figure had dropped significantly», – he added.

According to the company’s forecasts, if demand in the second quarter falls by 60%, then this will cause negative EBITDA, but a fall of 40% will already allow to break even.

«I don’t have an accurate forecast, but we expect some recovery in the third and fourth quarters.. Comparing the second half of 2020 to the first half, we expect the taxi service to be profitable», – says the CFO of Yandex.Taxi Evgeny Senderov.

«We are in good shape and have enough resources to get through the current situation», – he added.