Financial Data and Key Metrics Changes - In Q2 2019, consolidated revenue grew by 41% year-over-year, marking the fifth consecutive quarter of over 40% growth for Yandex [8][14] - Online advertising revenues, excluding Yandex.Market, increased by 21% year-over-year [14] - Adjusted net income rose by 16% year-over-year, with an adjusted net income margin of 14.1% [16] Business Line Data and Key Metrics Changes - Search and Portal revenues increased by 21% year-on-year, with adjusted EBITDA growing by 18% [17] - The Taxi segment saw a remarkable 117% year-on-year revenue growth, with adjusted EBITDA turning profitable at RUB 423 million [10][11] - Yandex.Eats, the food delivery service, reported over 600% revenue growth year-on-year [12] Market Data and Key Metrics Changes - The overall mobile surcharge surpassed 50% for the first time, averaging 58.1% in June, up 400 basis points year-on-year [9] - The number of rides in the Taxi segment increased by 49% year-on-year, with significant growth in both mature cities and regions [11] - Revenues from Other Bets and Experiments reached RUB 3.4 billion, a 203% increase year-on-year [20] Company Strategy and Development Direction - Yandex is focusing on enhancing its voice assistant, Alice, and integrating it into various platforms, including smart home devices [9][10] - The company is committed to expanding its Taxi services into regional markets and improving service quality through technology [11][12] - Yandex is investing in its cloud services, viewing it as a long-term opportunity despite slower market development compared to the U.S. [71][72] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging advertising market but expressed confidence in continued growth in online advertising due to a shift towards digital [8][14] - The company expects consolidated revenue growth, excluding Yandex.Market, to be between 32% and 36% year-over-year for the upcoming period [22] - Management emphasized the importance of safety, earnings for drivers, and affordability in the evolving regulatory environment for the Taxi segment [78][79] Other Important Information - Yandex ended the quarter with approximately RUB 75 billion in cash and cash equivalents, excluding Yandex.Market [22] - The company is actively working on alternatives for its headquarters lease, which expires in 2021 [68] Q&A Session Summary Question: Can you elaborate on the deceleration in CPC growth in the core search business? - Management explained that the focus is on driving higher returns for advertisers, which may lead to lower CPCs but higher paid clicks [25] Question: What is the current GMV run rate for the Taxi segment? - Management did not disclose the GMV but noted that the Taxi segment revenues increased by 117% in Q2 [29][30] Question: Are you seeing cannibalization between taxi rides and car-sharing? - Management acknowledged potential cannibalization but emphasized the goal of promoting a sharing economy [34] Question: What are the drivers behind the acceleration in media services growth? - The rollout of Yandex.Plus subscriptions and co-branded cards with banks were highlighted as key growth drivers [58] Question: How is the competitive landscape evolving in the cloud business? - Management stated that Yandex is a clear leader in technology within the Russian market, with significant potential for growth [71][72]
Yandex(YNDX) - 2019 Q2 - Earnings Call Transcript