Grab Holdings Ltd. (Singapore) Q3 FY2024 earnings call

Key Points

• Third quarter 2024 was a strong quarter with On-Demand GMV growth accelerated year-on-year.
• Group adjusted EBITDA more than tripled to reach $90 million, marking the 11th consecutive quarter of adjusted EBITDA improvement.
• MTUs grew 16% year-on-year to 42 million, a leading indicator of future platform growth.
• GrabUnlimited loyalty program hit an all-time high, and food to mart cross-sell was a strong growth source with mart growing 1.7x faster than food.
• Mobility saw 30% year-on-year GMV growth from high-value rides like advanced booking.
• Fintech lending expanded to all three markets, with the FlexiLoan product launching in all markets and having a high NPS of 65.

In the third quarter of 2024, Grab saw strong performance across segments. On-Demand GMV showed acceleration, with Delivery GMV growing 16% year-on-year in constant currency. Mart was growing 1.7x faster than Food, and cross-selling between the two was a key growth driver. Mobility had 30% year-on-year GMV growth from high-value rides. Fintech lending saw significant growth, with loan dispersals at 38% year-on-year and reaching $565 million in the third quarter. Monthly Transacting Users (MTUs) grew 16% year-on-year to 42 million, representing the sixth sequential quarter of growth.

Forward-Looking Statements

• Full-year 2024 adjusted EBITDA guidance is between $308 million and $313 million.
• Strong growth momentum continued in October and November, with expectations of sequential growth in On-Demand segments heading into the fourth quarter.
• Confidence in Grab's growth potential to capture opportunities in high value transactions and domestic demand while ensuring profitable growth and sustainable free cash flow generation.

Risks Identified

• Competitor spending in Indonesia could potentially impact margins, though Grab remains confident due to its regional scale and strong customer traction.
• Incentives may fluctuate quarter-to-quarter due to new product launches, which can affect margins in the short term but are not long-term drivers.

Q: Competitive landscape in certain markets and group corporate costs outlook?

A: Alex Hungate noted that Grab has scale and uses AI to optimize, making it hard for new entrants to gain traction. Peter Oey said regional corporate costs will have variable and fixed components, with operating leverage critical, and investments in GenAI driving productivity and efficiency