JAKARTA (Reuters) – Indonesia’s biggest tech firm PT GoTo Gojek Tokopedia will “prudently” make investment to maintain its market share after it reported a narrowed underlying losses in the third quarter, the company CEO said on Monday.
GoTo, which offers ride-hailing, e-commerce, and financial services, reported 942 billion rupiah ($59.30 million) in underlying losses for the July to September period, a significant drop from last year’s 3.7 trillion rupiah, according to a company statement, following cost-cutting measures, including to reduce marketing spend.
CEO Patrick Walujo, however, said in an earnings call that the measures have affected their market share, especially price-sensitive customers.
“The increasingly competitive operating environment… means we must invest to maintain our market leadership; we have and will continue to act prudently on this,” the CEO said adding the firm has also reduced its platform fees.
GoTo said it has rolled out specific products to cater to price-sensitive customers, such as low-cost options for its ride-hailing and food delivery services.
The strategy for broadening its market has put GoTo’s incentives and product marketing spending in the third quarter up 2% compared with the previous quarter.
GoTo, which is backed by Japan’s SoftBank Group and Singapore’s sovereign wealth fund GIC, also said its net losses for the period were narrowed to 2.4 trillion rupiah, versus last year’s losses of 6.7 trillion rupiah.
The group still aims to make a profit by the end of this year, it added.
GoTo also said it will not pursue an initial public offering in international markets at the moment as it has enough cash needed for its operations.
($1 = 15,885.0000 rupiah)
(This story has been corrected to change the month from June to July in paragraph 2)
(Reporting by Stefanno Sulaiman; Writing by Stanley Widianto; Editing by Kanupriya Kapoor and Jonathan Oatis)