Indonesian ride-hailing service provider Go To Group The company will focus on generating profits from its core businesses in Indonesia and Singapore, while withdrawing from the Vietnamese market where it has been facing fierce competition.
Vietnam’s ride-hailing market remains highly competitive, with Grab currently leading the way, and local company Be Group emerging as a strong competitor.
The company’s Gojek brand announced it would cease operations in Vietnam on September 16. Bloomberg.
The company’s Vietnam business, which offered ride-hailing, food delivery and courier services, accounted for less than 1% of GoTo’s total transaction volume in the second quarter, so its closure is unlikely to have a significant impact on its financial performance.
GoTo, which is now unprofitable, is aggressively cutting costs and streamlining operations as it faces slowing user growth and stiff competition from rivals such as Singapore’s Grab Holdings.
The company withdrew from Thailand in 2021 and late last year sold a controlling stake in its loss-making e-commerce unit, Tokopedia, to ByteDance’s TikTok for $1.5 billion.
Despite these efforts, GoTo has yet to achieve a net profit, even after cutting thousands of jobs and drastically reducing marketing costs.
But under the leadership of CEO Patrick Warrujo, who took over last year, the company has made significant progress toward its revenue targets.
GoTo on Wednesday reiterated its outlook for positive adjusted EBITDA for the full year.
The TikTok deal and ongoing cost-cutting measures have eased some financial pressure, but the tough market environment has prompted GoTo and its competitors to explore more aggressive options.
GoTo and Grab resumed talks earlier this year about a possible merger of their core businesses, according to Bloomberg News, a move that could allow the two companies to combine their operations and attract more users.
