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UPDATE 1-Russia's Yandex ups revenue outlook but investment weighs on profit

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  • YNDX

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MOSCOW, Oct 27 (Reuters) - Russian internet giant Yandex on Wednesday reported an 82% year-on-year drop in third-quarter adjusted net income, in part due to e-commerce investments, but raised its full-year group revenue forecast for a second time.

The rapidly expanding company, which is spending $650 million on an e-commerce drive this year, offers services ranging from advertising to ride-hailing and food delivery.

It now expects group revenue this year of 340-350 billion roubles ($4.84-$5 billion), up from the 330-340 billion roubles forecast at the end of July and 315-330 billion roubles previously.

Total gross merchandise volume (GMV) - the total value of goods sold and a measure of business growth - for its e-commerce businesses, namely Yandex.Market, grocery delivery service Yandex.Lavka and the grocery portion of its food delivery service Yandex.Eats, jumped 214% year-on-year to 41 billion roubles.

For the full year, the company expects the measure to be three times higher than in 2020, and analysts point to strong growth across all business divisions.

By 1044 GMT, Yandex's shares in Moscow were up 0.7% on the day.

While quarterly revenue climbed 52% year-on-year to 91.3 billion roubles, adjusted net income fell to 1.34 billion roubles.

Yandex said the hefty investments in e-commerce, as well as cloud and fintech services and its self-driving business drove a 62% decline in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to 5.6 billion roubles.

In August, the company said it would buy Uber's stakes in their joint foodtech, delivery and self-driving businesses, and increase its stake in their ride-hailing joint venture as part of a $1 billion deal.

Overall, Yandex reported a net loss of 3.9 billion roubles for the quarter, compared with net income of 21.8 billion roubles in the same period of 2020, which benefited from a one-off gain from consolidating the Yandex.Market business.

The contribution from foodtech services to group revenue edged above 10% for the first time, while advertising held below 50% for a third successive quarter. ($1 = 70.3175 roubles) (Reporting by Gleb Stolyarov, Alexander Marrow and Anna Rzhevkina; Editing by Katya Golubkova, Kirsten Donovan)