Financial Performance - In 2023, total revenues reached RUB 800,125 million, a 53.1% increase from RUB 521,699 million in 2022[281] - Service revenues accounted for 82% of total revenues in 2023, increasing by RUB 228,364 million or 53.1% year-over-year[282] - The Search and Portal segment generated revenues of RUB 337,514 million in 2023, up from RUB 226,022 million in 2022[279] - The E-commerce, Mobility, and Delivery segment saw revenues rise to RUB 420,753 million in 2023, compared to RUB 261,246 million in 2022[279] - Revenues from the Search and Portal segment grew by RUB 111,492 million or 49.3% in 2023, contributing approximately 42.2% of total revenues[304] - E-commerce, Mobility and Delivery segment revenues increased by RUB 159,507 million or 61.1% in 2023, representing 52.6% of total revenues[305] - E-commerce revenues surged by RUB 77,592 million or 76.7% in 2023, driven by a normalization of the 1P/3P revenue mix[306] - Mobility revenues rose by RUB 43,941 million or 36.0% in 2023, with the number of rides increasing to 3.6 billion[307] - Revenues from the Plus and Entertainment services segment increased by RUB 35,117 million or 110.5% in 2023, driven by subscription revenue growth[309] Profitability and Expenses - Adjusted EBITDA for 2023 was RUB 96,970 million, reflecting a significant increase from RUB 64,142 million in 2022[279] - Operating costs as a percentage of revenues decreased to 96.4% in 2023 from 97.5% in 2022, indicating improved operational efficiency[276] - Cost of goods sold increased by RUB 35,757 million in 2023, aligning with revenue growth[290] - Product development expenses rose by RUB 30,713 million or 42.5% in 2023, totaling RUB 102,991 million, which is 12.9% of revenues[292] - Sales, general and administrative expenses increased by RUB 95,460 million or 55.5% in 2023, reaching RUB 267,552 million, accounting for 33.4% of revenues[294] - Adjusted EBITDA for the Search and Portal segment increased by RUB 52,447 million or 43.5% in 2023, with a margin of 51.2%[313] - Adjusted EBITDA losses for the E-commerce, Mobility and Delivery segment expanded by RUB 3,967 million or 20.2% in 2023[314] - Adjusted EBITDA loss for Other Business Units and Initiatives increased by RUB 26,950 million or 90.3% in 2023, primarily due to unallocated corporate expenses and investments in FinTech and Yandex SDG businesses[317] Cash Flow and Debt - Net cash provided by operating activities increased by RUB 28,594 million in 2023, attributed to positive trends in advertising revenue and operational efficiency in Mobility services[340] - Net cash used in investing activities amounted to RUB 106,943 million in 2023, primarily due to increased acquisitions of property and equipment[342] - Net cash provided by financing activities was RUB 41,843 million in 2023, including proceeds from debt issuance of RUB 227,151 million[345] - As of December 31, 2023, cash and cash equivalents totaled RUB 96,519 million, with total debt recorded at RUB 141,484 million[333] - Total contractual obligations as of December 31, 2023, amount to RUB 262,840 million, with RUB 130,168 million due within one year[350] - Debt obligations total RUB 141,484 million, with RUB 92,046 million due within one year[350] - Operating lease obligations are RUB 43,766 million, with RUB 13,216 million due within one year[350] - Finance lease obligations total RUB 43,651 million, with RUB 7,087 million due within one year[350] Interest and Other Income - Interest income rose from RUB 4,723 million in 2022 to RUB 5,637 million in 2023, driven by higher applicable interest rates[318] - Interest expense surged to RUB 10,863 million in 2023 from RUB 3,396 million in 2022, mainly due to new debt facilities and increased interest rates[320] - A gain of RUB 9,305 million was recognized from the restructuring of convertible debt, with over 99% of the $1.25 billion Convertible Notes repurchased[322] - The sale of the news aggregation platform and Zen resulted in a gain of RUB 38,051 million, marking a strategic exit from media businesses[323] - Other income increased to RUB 21,514 million in 2023, representing 2.7% of revenues, compared to 1.8% in 2022[325] Economic Outlook and Risks - The Central Bank of Russia forecasts inflation could drop to 4.0-4.5% in 2024, impacting operating expenses and capital expenditures[268] - Foreign exchange fluctuations could result in additional foreign exchange losses/gains of RUB 2,279 million if the U.S. dollar fluctuates by 20% against the Russian ruble[363] - A hypothetical increase in the base interest rate by one percentage point would result in an additional interest expense of approximately RUB 1,061 million annually[366] - The company recorded a loss of RUB 9,369 million in accumulated other comprehensive income for the year ended December 31, 2023, due to translation effects[365] - The fair value of share consideration related to convertible debt was determined based on appropriate valuation techniques amid trading halts[361] - The company has made significant judgments regarding uncertain tax positions, which may impact future income tax expenses[356] - Management's estimates regarding deferred tax assets could materially impact consolidated financial statements if actual events differ from expectations[356] Employee and Management Information - In 2023, the aggregate cash compensation for senior management was RUB 1,607 million ($17.9 million), including RUB 989 million ($11.0 million) paid instead of vested equity awards[379] - The total number of employees increased from 20,850 in 2022 to 26,361 in 2023, with product development staff rising from 10,708 to 13,003[390] - The company granted 131,227 Synthetic Options and Business Unit Equity Awards in 2023, which will vest 25% after one year and the remaining part quarterly over three years[379] - Approximately 3.3 million RSUs were exchanged for cash bonuses in 2022, and an additional 2.7 million RSUs were exchanged in 2023[401][402] - The company has not experienced any work stoppages and believes employee relations are good[391] - The 2016 Equity Incentive Plan allows for equity awards equal to 20% of the aggregate number of Class A and Class B shares outstanding[394] - The company employs several thousand part-time contract workers, which are not included in the total employee count[390] Governance and Oversight - The audit committee oversees the financial reporting processes and audits of consolidated financial statements[382] - The compensation committee is responsible for reviewing and approving compensation structures for directors and management[383] - The investment committee reviews potential corporate transactions, including mergers and acquisitions[392]
Yandex(YNDX) - 2023 Q4 - Annual Report