Group 1 - The stock market is reflecting concerns in the macroeconomy, suggesting a need for careful stock-picking to outperform the market for the remainder of FY25 [1] - There is a trend of rotating out of large-cap growth stocks, indicating a shift in investment strategy [1] - Gary Alexander has extensive experience in technology sectors, both on Wall Street and in Silicon Valley, which informs his insights into current industry themes [1] Group 2 - The article expresses a beneficial long position in the shares of GRAB, indicating a positive outlook on the company's stock [2] - The author emphasizes that the opinions expressed are personal and not influenced by compensation from any company mentioned [2]

SINGAPORE, July 31, 2025 - Grab Holdings Limited (NASDAQ: GRAB) today announced unaudited financial results for the second quarter ended June 30, 2025. "We delivered another record quarter of profitable growth at scale, with over 46 million monthly transacting users powering the Grab ecosystem flywheel. Grab's growth engine continues to gain momentum, with On- Demand GMV accelerating to 21% year-over-year ("YoY") or 18% YoY on a constant currency basis , and Grab achieving our fourteenth consecutive quarter ...

Financial Data and Key Metrics Changes - Grab reported a 21% year-on-year growth in on-demand GMV in U.S. dollars, or 18% on a constant currency basis [6][7] - Adjusted EBITDA growth has been sustained for fourteen consecutive quarters, with trailing twelve months adjusted free cash flow expanding to $229 million [7] - The company achieved a margin of 8.7% for Mobility, nearing its steady state margin target of over 9% [17] Business Line Data and Key Metrics Changes - Mobility transactions grew by 23% year-on-year, with GMV increasing by 19% year-on-year [15] - Delivery GMV accelerated to 19% year-on-year on a constant currency basis, driven by product-led initiatives [22] - GrabFood for One and Saver products contributed significantly to transaction growth, with Saver accounting for 34% of delivery transactions in Q2 [25] Market Data and Key Metrics Changes - The company is actively participating in government initiatives in Indonesia and Thailand to support local economies and tourism [12][13] - Grab's financial services business saw total loan disposals reaching close to $3 billion on an annualized run rate basis in Q2 [7] Company Strategy and Development Direction - Grab is focusing on affordability and product-led innovations to drive user engagement and retention [10][11] - The company aims to sustain growth momentum and accelerate on-demand GMV growth rates relative to 2024 levels [8] - Grab is leaning into the autonomous vehicle opportunity, planning pilots and partnerships to expand its AV services across Southeast Asia [28][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties through product-led investments and partnerships with governments [10][11] - The outlook for the second half of the year is positive, with expectations for stronger adjusted EBITDA compared to the first half [13] Other Important Information - Grab's advertising revenue reached a run rate of $236 million, growing at 45%, with significant potential for further growth [70] - The company is committed to achieving steady state margins of over 4% in the delivery segment in the long term [27][51] Q&A Session Summary Question: Outlook for Grab in the macro environment and consumption trends - Management is focused on affordability and has launched products to enhance user engagement, positioning the company well amid macro uncertainties [10][11] Question: Strategies driving increase in mobility transaction frequency - The growth in mobility transactions is attributed to reinvestment in scale economies and product-led growth initiatives [14] Question: Impact of new delivery products on margins - Despite the introduction of affordable products, delivery segment margins have expanded, and the company expects to reach steady state margins of over 4% [26][51] Question: Contribution mix between premium and affordable rides - Saver rides now account for one-third of mobility transactions, while premium rides are also growing, indicating a balanced approach to pricing [52] Question: Competition in food delivery and capital allocation - Management acknowledged competitive dynamics but emphasized Grab's scale and reinvestment strategy to maintain growth [40][41] Question: Expectations for advertising revenue growth - The advertising business is expected to continue growing due to increased penetration among merchants and high returns on advertising spend [72] Question: Financial services loan portfolio growth - The loan portfolio is projected to exceed $1 billion by year-end, driven by strong product offerings and risk management strategies [84][86]

Financial Data and Key Metrics Changes - Grab reported a year-on-year growth of 21% in on-demand GMV in U.S. Dollars, or 18% on a constant currency basis [5][6] - Adjusted EBITDA growth was sustained for the fourteenth consecutive quarter, with trailing twelve months adjusted free cash flow expanding to $229 million [6] - The company achieved an all-time high in monthly transacting users (MTUs) [6] Business Line Data and Key Metrics Changes - Mobility transactions grew by 23% year-on-year, with GMV increasing by 19% year-on-year [14][15] - Delivery GMV accelerated to 19% year-on-year on a constant currency basis, driven by product-led initiatives [21] - Financial Services business saw total loan disposals reaching close to $3 billion on an annualized run rate basis [6] Market Data and Key Metrics Changes - The company is focusing on affordability to attract more price-sensitive users, which has been critical in the current macroeconomic environment [10][11] - In Indonesia, Grab participated in a government initiative to deliver nutritious meals, enhancing brand loyalty and user engagement [12] - In Thailand, Grab is collaborating with the government to support the tourism sector [13] Company Strategy and Development Direction - Grab aims to maintain growth momentum and accelerate on-demand GMV growth rates relative to 2024 levels while maintaining cost discipline [6][11] - The company is investing in product-led innovations to enhance user engagement and retention [10][11] - Grab is leaning into the autonomous vehicle (AV) opportunity, planning pilots and partnerships to support the transition [28][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties through product-led investments and partnerships with governments [10][11] - The outlook for on-demand GMV growth in 2025 is expected to accelerate compared to 2024 levels, with adjusted EBITDA in the second half anticipated to be stronger than the first half [13] - Management emphasized the importance of balancing growth and profitability, particularly in the delivery segment [79][85] Other Important Information - The advertising revenue run rate reached $236 million, growing at 45%, with expectations for continued growth due to increased penetration among merchants [67][70] - The company completed a $500 million buyback and has no immediate plans for new buyback programs [41] Q&A Session Summary Question: Outlook for Grab in the macro environment - Management is focused on affordability and has launched products to enhance user engagement, positioning the company well despite macro uncertainties [10][11] Question: Strategies driving increase in mobility transaction frequency - The growth in mobility transactions is attributed to reinvestment in scale economies and product-led growth strategies [14][15] Question: Delivery segment margin outlook - Despite the growth of affordable products, delivery segment margins have expanded, and management expects continued improvement [25][49] Question: Capital allocation post convertible bond raise - The company maintains a prudent approach to capital allocation, prioritizing organic growth while remaining open to M&A opportunities [39][41] Question: Competition in food delivery in Vietnam - Management noted that the AOV drop in mobility is a strategic decision to drive volume rather than a response to competitive pressures [35][36] Question: Long-term outlook for GrabMart - GrabMart is expected to grow faster than traditional food delivery, with significant potential in the online grocery market [60][62]

Financial Performance - Grab's Q2 2025 revenue increased by 23% year-over-year (YoY) to $819 million, or 19% YoY in constant currency[32] - Adjusted EBITDA for Q2 2025 was $109 million, a 69% increase YoY[32] - The company reported a profit of $20 million for the period, compared to a loss of $68 million in Q2 2024[32] - Trailing 12-month Adjusted Free Cash Flow was $229 million, an increase of $274 million YoY[17] Segment Performance - On-Demand Gross Merchandise Value (GMV) grew by 21% YoY to $5354 million, or 18% YoY in constant currency[32] - Deliveries GMV increased by 22% YoY to $3471 million, or 19% YoY in constant currency, with new product initiatives contributing a third of Deliveries GMV[38, 22] - Mobility GMV grew by 19% YoY to $1883 million, or 16% YoY in constant currency[41] - Loan portfolio in Financial Services grew by 78% YoY to $708 million[32, 44] Operational Highlights - Mobility Monthly Transacting Users (MTUs) increased by 16% YoY[19] - Loan disbursals grew 44% YoY, reaching $2900 million annualized in Q2 2025[24] - Annualized advertising revenue run-rate reached $236 million[27] Liquidity and Outlook - The company maintains ample net cash liquidity of $5700 million as of June 30, 2025[30, 33] - The outlook for 2025 revenue is projected to be between $3330 million and $3400 million, representing a 19%-22% YoY increase[48] - The outlook for 2025 Adjusted EBITDA is projected to be between $460 million and $480 million, representing a 47%-53% YoY increase[48]

Core Insights - Grab is positioning itself as a super-app in Southeast Asia, integrating services such as ride-hailing, food delivery, and digital payments, similar to a combination of Uber, DoorDash, and PayPal [1] Company Overview - Grab's diversified operations and its strategy to build dominance in Southeast Asia create significant growth potential in the region [1] Market Strategy - The company aims to consolidate various services into one platform, enhancing user convenience and engagement [1]

Core Insights - Grab Holdings Limited is currently experiencing a pivotal moment, with a focus on sustained profitability and monetization metrics, particularly in the fintech sector [1] Financial Performance - The company's share prices have reacted positively following the announcement of its first quarter results, indicating investor confidence in its financial trajectory [1] Market Position - Grab is positioned at a crossroads, suggesting potential strategic decisions that could influence its future growth and market presence [1]

Group 1 - Grab presents a significant opportunity for investment in Southeast Asia due to its strong market presence and diversified offerings [1] - The region is expected to continue experiencing relatively strong economic growth, which could benefit companies operating there [1] - Observing megatrends can provide insights into societal advancements and potential investment opportunities [1] Group 2 - The importance of fundamentals, quality of leadership, and product pipeline is emphasized for uncovering investment opportunities [1] - Recent focus has been on marketing and business strategy for medium-sized companies and startups, indicating a trend towards supporting emerging businesses [1] - The analyst has experience in evaluating startups and emerging industries, which adds credibility to the insights provided [1]

Core Insights - Grab Holdings operates similarly to Uber in Southeast Asia, holding a near monopoly or duopoly in most countries within the region [1] Company Overview - Grab Holdings is involved in key markets across Southeast Asia, indicating a strong regional presence and competitive advantage [1] Analyst Background - The analyst has over 10 years of experience researching various companies across multiple sectors, including commodities and technology, which enhances the credibility of the insights provided [1]

Group 1 - Grab Holdings Limited (GRAB) closed at $4.93, reflecting a -1.99% change from the previous day's closing price, underperforming the S&P 500's daily loss of 0.11% [1] - The stock has increased by 3.71% over the past month, which is lower than the Computer and Technology sector's gain of 8.76% and the S&P 500's gain of 5.17% [1] Group 2 - The upcoming earnings report for Grab Holdings is anticipated, with projected EPS of $0.01, indicating a 200.00% increase year-over-year, and revenue projected at $803.19 million, up 20.96% from the previous year [2] - For the full year, earnings are projected at $0.05 per share and revenue at $3.34 billion, reflecting increases of +266.67% and +19.34% respectively from the prior year [3] Group 3 - Grab Holdings Limited currently has a Zacks Rank of 3 (Hold), with no changes in the Zacks Consensus EPS estimate over the past month [5] - The Forward P/E ratio for Grab Holdings is 107.79, significantly higher than the industry average of 29.16, indicating that the company is trading at a premium [6] Group 4 - The Internet - Software industry, which includes Grab Holdings, has a Zacks Industry Rank of 40, placing it in the top 17% of over 250 industries [6] - The Zacks Rank system has a strong track record, with stocks rated 1 producing an average annual return of +25% since 1988 [5]