- Grab finally hits its positive EBITDA milestone.
- Next up is positive free cash flow.
- Further top and bottom-line growth should re-rate the stock over time.
This article examines Grab Holdings Limited (GRAB) following a strong quarter that has propelled the Southeast Asian "super app" into positive EBITDA territory. With an impressive growth trajectory and a net cash position, Grab now sets its sights on achieving positive free cash flow in the coming year. Despite the stock experiencing a slight decline since the last coverage, the narrative explores the company's potential for sustained success and its discounted valuations, presenting an intriguing entry point for long-term investors.
- Positive Q3 Performance and EBITDA Milestone: Grab concluded Q3 with robust performance across its core businesses, witnessing a +31% YoY growth in mobility adjusted revenue and a notable +79% YoY surge in delivery segment revenue. The company's strategic response to increased demand, improved driver supply, and the success of its GrabUnlimited subscription offering contributed to positive adjusted EBITDA, marking a significant milestone and establishing a low teens % EBITDA margin.
- Diverse Revenue Streams and Growth Initiatives: Beyond core segments, enterprise and new initiatives reported strong +83% YoY growth, driven by a focus on advertising momentum. Grab's efforts to monetize user and transaction data in Southeast Asia are reflected in narrowing losses from financial services, with digital banking optimization initiatives contributing to a variable cost structure. Group-level adjusted EBITDA turned profitable at $29 million in Q3, surpassing consensus estimates.
- Guidance and Outlook:
