Singapore’s Grab says its ride-hailing unit is on track to hit pre-Covid levels by the end of the year
Signages at the Grab Holdings Ltd. headquarters in Singapore, on Sunday, Aug. 20, 2023. Grab released earnings results on Aug. 23. Photographer: Ore Huiying/Bloomberg via Getty Images
Ore Huiying | Bloomberg | Getty Images
Singapore-based Grab said on Wednesday that its ride-hailing unit is on track to hit pre-Covid levels by the end of this year.
In its second-quarter earnings release, Grab reported that its mobility gross merchandise value for the quarter was $1.32 billion, a 28% increase from $1.03 billion in the same period a year ago. Grab, which also offers food delivery and mobile payments, said that its mobility GMV has recovered to 85% of pre-Covid levels.
“International traveler demand continues to recover. We increased airport rides by 64% year on year to reach 77% of pre-Covid levels,” COO Alex Hungate said during an earnings call Wednesday.
“Domestic demand also further normalized across our markets with mobility GMV now 85% of pre-Covid levels. When we compare mobility GMV levels between second quarter 2023 and the same period in 2019, several of our core markets such as Malaysia, Singapore and Thailand have either reached or surpassed these levels,” said Hungate.
Pandemic lockdowns and restrictions hit Grab’s ride-hailing business. In the third quarter of 2021, its mobility business fell behind its deliveries unit, recording $88 million in revenue for a 26% year-over-year decrease while the latter’s revenue soared 58%. Singapore lifted most of its Covid-19 restrictions in April 2022 and all remaining pandemic-era border measures in February this year.
We remain on track to exit 2023 at pre-Covid GMV levels.
Peter Oey
CFO, Grab
In February, Grab CFO Peter Oey told CNBC the company has “seen a lot more traffic” as people head back to offices and resume travel.
“We remain on track to exit 2023 at pre-Covid GMV levels,” Oey said during Grab’s earnings call on Wednesday.
At the start of 2023, Grab also resumed GrabShare — its car-pooling service which was suspended during the pandemic.
“GMV growth was attributed to the growth in mobility and deliveries GMV, and group monthly transacting users,” Sachin Mittal, head of telecom, media and technology research at DBS Bank, said in a note.
Deliveries GMV grew 4% year on year due to an expanding subscriber base for GrabUnlimited, a monthly subscription plan that offers users discounts and deals.
DBS said Grab is fully valued and that “we do not see a big room for margin upliftment in the long-term.”
Grab’s Hungate said driver supply levels are currently at 84% of pre-Covid levels and that the firm will “continue to focus on improving driver supply.” Singapore has faced a shortage of drivers since the pandemic, resulting in higher fares and longer waiting times.
In July, Grab said it would acquire Trans-cab to grow its driver base and digitize Trans-cab’s fleet operations. Trans-cab is Singapore’s third largest taxi operator and has a combined fleet of more than 2,500 vehicles. The deal is expected to be completed by the fourth quarter.
“The company flexed its competitive strength this quarter by acquiring Trans-cab. We believe the acquisition provides inroads to car leasing and expands the fleet for Grab, which should further bolster its mobility services in Singapore,” Kai Wang, senior equity analyst at Morningstar Asia, said in a Aug. 24 report.
Pulls forward profitability timeline
On Wednesday, Grab posted revenue and net loss figures that beat estimates. Revenue for the second quarter was $567 million, up 77% from a year ago. Its net loss was $135 million, an improvement of 75.3% from the $547 million logged in the second quarter of 2022.
Grab’s U.S.-listed shares closed 10.78% higher on Wednesday.
“Overall, it is quite a positive set of numbers,” said Jonathan Woo, senior research analyst at Phillip Securities Research.
“At least there is some end in sight for profitability. We think that Grab could turn a net profit as soon as early 2025 if costs continue to improve,” said Woo.
Grab is largely unprofitable, amassing billions of dollars in losses since its inception. But on Wednesday, Grab pushed forward its breakeven target to the third quarter. It previously forecast it would hit break even in the fourth quarter. For 2023, Grab expects revenue between $2.2 billion and $2.3 billion.
Over the past few months, Grab cut costs in response to macroeconomic headwinds, reducing customer incentives and discretionary spending, as well as conducting mass layoffs. Other regional tech giants like Sea and GoTo similarly slashed costs through methods such as mass layoffs and freezing salaries.
In June, Grab announced it would cut over 1,000 jobs in order to “adapt to the environment” and a higher cost of capital. It was the group’s largest round of layoffs since 2020, when it laid off 360 employees in the face of pandemic challenges.
The Nasdaq MarketSite in New York, June 9, 2023.
Michael Nagle | Bloomberg | Getty Images
Silicon Valley executives and financiers publicly opened their wallets in support of President Donald Trump’s 2024 presidential run. The early returns in 2025 aren’t great, to say the least.
Following Trump’s sweeping tariff plan announced Wednesday, the Nasdaq suffered steep consecutive daily drops to finish 10% lower for the week, the index’s worst performance since the beginning of the Covid pandemic in 2020.
The tech industry’s leading CEO’s rushed to contribute to Trump’s inauguration in January and paraded to Washington, D.C., for the event. Since then, it’s been a slog.
The market can always turn around, but economists and investors aren’t optimistic, and concerns are building of a potential recession. The seven most valuable U.S. tech companies lost a combined $1.8 trillion in market cap in two days.
Apple slid 14% for the week, its biggest drop in more than five years. Tesla, led by top Trump adviser Elon Musk, plunged 9.2% and is now down more than 40% for the year. Musk contributed close to $300 million to help propel Trump back to the White House.
Nvidia, Meta and Amazon all suffered double-digit drops for the week. For Amazon, a ninth straight weekly decline marks its longest such losing streak since 2008.
With Wall Street selling out of risky assets on concern that widespread tariff hikes will punish the U.S. and global economy, the fallout has drifted down to the IPO market. Online lender Klarna and ticketing marketplace StubHub delayed their IPOs due to market turbulence, just weeks after filing with the Securities and Exchange Commission, and fintech company Chime is also reportedly delaying its listing.
CoreWeave, a provider of artificial intelligence infrastructure, last week became the first venture-backed company to raise more than $1 billion in a U.S. IPO since 2021. But the company slashed its offering, and trading has been very volatile in its opening days on the market. The stock plunged 12% on Friday, leaving it 17% above its offer price but below the bottom of its initial range.
“You couldn’t create a worse market and macro environment to go public,” said Phil Haslett, co-founder of EquityZen, a platform for investing in private companies. “Way too much turbulence. All flights are grounded until further notice.”
CoreWeave investor Mark Klein of SuRo Capital previously told CNBC that the company could be the first in an “IPO parade.” Now he’s backtracking.
“It appears that the IPO parade has been temporarily halted,” Klein told CNBC by email on Friday. “The current tariff situation has prompted these companies to pause and assess its impact.”
‘Cave rapidly’
During last year’s presidential campaign, prominent venture capitalists like Marc Andreessen backed Trump, expecting that his administration would usher in a boom and eliminate some of the hurdles to startup growth set up by the Biden administration. Andreessen and his partner, Ben Horowitz, said in July that their financial support of the Trump campaign was due to what they called a better “little tech agenda.”
A spokesperson for Andreessen Horowitz declined to comment.
Some techies who supported Trump in the campaign have taken to social media to defend their positions.
Venture capitalist Keith Rabois, a managing director at Khosla Ventures, posted on X on Thursday that “Trump Derangement Syndrome has morphed into Tariff Derangement Syndrome.” He said tariffs aren’t inflationary, are effective at reducing fentanyl imports, and he expects that “most other countries will cave and cave rapidly.”
That was before China’s Finance Ministry said on Friday that it will impose a 34% tariff on all goods imported from the U.S. starting on April 10.
At Sequoia Capital, which is the biggest investor in Klarna, outspoken Trump supporter Shaun Maguire, wrote on X, “The first long-term thinking President of my lifetime,” and said in a separate post that, “The price of stocks says almost nothing about the long term health of an economy.”
However, Allianz Chief Economic Advisor Mohamed El-Erian warned on Friday that Trump’s extensive raft of import tariffs are putting the U.S. economy at risk of recession.
“You’ve had a major repricing of growth prospects, with a recession in the U.S. going up to 50% probability, you’ve seen an increase in inflation expectations, up to 3.5%,” he told CNBC’s Silvia Amaro on the sidelines of the Ambrosetti Forum in Cernobbio, Italy.
Former Microsoft CEOs Bill Gates, left, and Steve Ballmer, center, pose for photos with CEO Satya Nadella during an event celebrating the 50th Anniversary of Microsoft on April 4, 2025 in Redmond, Washington.
Stephen Brashear | Getty Images
Meanwhile, executives at tech’s megacap companies were largely silent this week, and their public relations representatives declined to provide comments about their thinking.
Microsoft CEO Satya Nadella was in the awkward position on Friday of celebrating his company’s 50th anniversary at corporate headquarters in Redmond, Washington. Alongside Microsoft’s prior two CEOs, Bill Gates and Steve Ballmer, Nadella sat down with CNBC’s Andrew Ross Sorkin for a televised interview that was planned well before Trump’s tariff announcement.
When asked about the tariffs at the top of the interview, Nadella effectively dodged the question and avoided expressing his views about whether the new policies will hamper Microsoft’s business.
Ballmer, who was succeeded by Nadella in 2014, acknowledged to Sorkin that “disruption is very hard on people” and that, “as a Microsoft shareholder, this kind of thing is not good.” Ballmer and Gates are two of the 12 wealthiest people in the world thanks to their Microsoft fortunes.
C-suites may not be able to stay quiet for long, especially if the recent turmoil spills into next week.
Lise Buyer, who previously helped guide Google through its IPO and now works as an adviser to companies going public, said there’s no appetite for risk in the market under these conditions. But there is risk that staffers get jittery, and they’ll surely look to their leaders for some reassurance.
“Until markets settle out and we have the opportunity to access valuation levels, public company CEOs should work to calm potentially distressed employees,” Buyer said in an email. “And private company managements should refine plans to get by on dollars already in the treasury.”
— CNBC’s Hayden Field, Jordan Novet, Leslie Picker, Annie Palmer and Samantha Subin contributed to this report.
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