Grab records all-time adjusted EBITDA high for Q1

Photo credit: Grab

After becoming EBITDA profitable in its last two quarters, Southeast Asian super app Grab has maintained its momentum, hitting US$62 million in adjusted EBITDA for the first quarter of 2024. The amount is an all-time high, the company noted, and is a US$129 million improvement year on year.

This has led the company to revise its 2024 adjusted EBITDA guidance upward, from between US$180 million and US$200 million previously to between US$250 million and US$270 million.

“Our focus on product-led growth is bearing fruit, with on-demand gross merchandise value (GMV) scaling to new highs in spite of the seasonal impact we usually see in the first quarter of the year,” said Anthony Tan, Grab’s co-founder and group CEO, in a statement. “Our push on affordability and reliability is pulling more people onto our platform and driving up order frequency.”

Peter Oey, Grab’s CFO, said that the company has repurchased US$97 million worth of class A ordinary shares in March, while paying down US$497 million of its term loan B. The share buyback is part of a US$500 million scheme first announced in February.

While Grab has not disclosed an official reason for the buyback scheme, it usually signals a company’s confidence that its stock would rise, at least in the short term.

Meanwhile, Grab’s revenue for Q1 2024 rose by 24% year on year to US$653 million, while loss for the quarter was US$115 million. The firm attributed the revenue result to growth across all segments along with a reduction in on-demand incentives – the latter stood at 9.7% of on-demand GMV, compared to 10.7% in Q1 2023.

Deliveries continued to be the largest revenue source, with US$350 million for the quarter. Mobility contributed US$247 million, though it recorded the highest segment adjusted EBITDA at US$138 million.

Financial services has continued to grow, though the unit is still adjusted EBITDA negative. Grab has made some recent moves in this segment, phasing out the GrabPay card in favor of its GXS digibank while adding crypto top-ups for its Singapore users.

See also: Is Grab’s ride-hailing business future-proof?