ALEXANDRIA, Va.—Grab, a food-delivery company based in Singapore, cut its gross merchandise volume outlook for the year, reports Reuters. The company said a strong dollar and shrinking demand for food-delivery services were to blame.
“What we are seeing with some of the growth trends and consumer behavior is dining out has taken place,” Grab CEO Anthony Tan told analysts. “Customers want to save money … they may actually show a preference to order groceries to cook for themselves.” Grab also offers grocery delivery.
Grab operates in 480 cities in eight countries in Southeast Asia. The company did lift the lower end of its revenue forecast for the year, saying it’s “laser-focused” on profitability as demand for rideshare across Southeast Asia peaks. Tan expects the rideshare portion of Grab to increase once economies reopen.
The company is also planning to launch new products to attract “profitable loyal customers” and lower the cost of serving users.
To cut company costs, Grab will cut back on inventories and promotions to attract drivers and users, drop unprofitable businesses such as its “dark stores” in some countries and decrease hiring.
The company forecast revenue between US$1.25 billion and $1.3 billion for the year, compared with its prior range of $1.2 billion and $1.3 billion. Grab forecasts gross merchandise volume growth between 21% and 25% for the year. On a constant currency basis, gross merchandise volume is expected to grow between 25% and 29%, compared with its prior range of 30% and 35%.
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