JAKARTA Indonesia's biggest tech company PT GoTo Gojek Tokopedia Tbk posted a first-quarter underlying loss of 102 billion rupiah (US$6.28 million or RM29.89 million) on Monday, but said it is on track for profitability, helped by its partnership with TikTok.

It blamed the loss, compared with 1.6 trillion rupiah a year ago and a 77 billion rupiah profit for the final quarter of last year (4Q2023), on planned investment and seasonal slowness in the on-demand services segment in January and February.

"We expect even faster growth for the rest of the year, while also remaining committed to our profitability goals," group chief executive officer Patrick Walujo said.

China's TikTok in December bought a majority stake in GoTo's e-commerce unit Tokopedia.

"Early results have been promising with compliance requirements fulfilled and early performance proving robust," the company said in a statement.

The company's profitability, it said, will be driven by lower costs in running Tokopedia and increased income, as Tokopedia is expected to grow faster compared to overall expansion in Indonesia.

It also said GoTo expects to secure growth in broad user demographics in its core on-demand services and financial technology segments across the Indonesian market.

"We will continue to invest prudently, while maintaining cost discipline, as we aim to ensure that our growth can be sustained over the long term,” group chief financial officer Jacky Lo said in a statement.

Lo also said the company is on track to meet its target to maintain adjusted earnings before interest, taxes, depreciation and amortisation for the full year of 2024.

Meanwhile, the company also posted net revenue of 4.079 trillion rupiah for 1Q2024, after reporting full-year net revenue of 14.79 trillion rupiah for 2023.

As part of last year's TikTok agreement, GoTo entered into a conditional sale and purchase agreement to divest ownership of its delivery and fulfilment unit under GoTo Logistics that supports Tokopedia.

After the transaction is completed, GoTo Logistics will be deconsolidated from the company, it said in a statement, adding that the measure will not impact the GoSend delivery service segment.

  - Reuters