PropertyGuru has released its Q2 2023 figures after a tumultuous week in which it exited the Indonesian market and sunsetted one of its SaaS products.
Hari V. Krishnan, CEO at PropertyGuru, said:
"PropertyGuru delivered a good quarter of double-digit revenue growth and a double-digit Adjusted EBITDA margin, standing firm in a Southeast Asian economy wrestling with inflation and rising interest rates. This was the result of focused investments and execution despite ongoing macro challenges in Vietnam, where last year’s government interventions in the property market continue to impact consumer sentiment and transaction volumes.
"Our focus on leveraging generative AI has bolstered our market-leading products while driving improvements in code quality and engineering productivity. In June, we launched GuruPicks, an automated and personalised feed of property listings based on machine learning algorithms, and upgraded our AI image moderation engine to continue to enhance listing quality.
"Earlier this week, we made strategic decisions to phase out our Indonesia marketplace business, Rumah.com, and sunset one of our SaaS products, FastKey. We regularly review our progress as a business and take necessary steps to optimize our resources. These actions align with our time-tested approach to focus our investments on businesses with strong unit economics that have shown the potential to achieve scalable growth. We acknowledge the impact of these decisions on our valued teams. I would like to extend my heartfelt gratitude to the impacted Gurus for their contributions to the Group and wish them the very best in their future endeavors."
Singapore continues to be a safe bet for PropertyGuru—marketplace revenue grew a healthy 25% YoY to S$22M, with agent numbers and average revenue per agent also on the up.
Malaysia also continues to perform well since the 2021 acquisition of iProperty, with a steady YoY revenue increase of 10% to S$7M.
Meanwhile, Vietnam struggled with marketplace revenues down significantly to S$5M, a 27% YoY decrease. However, the Group's recent appointment of Duong Bach as the next country manager for Vietnam points to a proactive strategy in Property Guru's 'third' market. The segment had made a loss in Q1 but returned to profitability in Q2.
PropertyGuru will also take confidence in its 82% renewal rate from agents.
Meanwhile, PropertyGuru's Fintech and data services held steady with respectable revenues of S$1.5M for the quarter, a 47% increase YoY—but the segment is still incurring heavy losses, contributing an almost S$3M hit to EBITDA.
It's a reminder that PropertyGuru has yet to achieve profitability, despite continued growth.
And it's this reality that led to the Group hitting the headlines this week with the shock announcement that it will exit the Indonesian market after 12 years of operations without achieving number-one status.
PropertyGuru operates the Rumah.com vertical in Indonesia and reports the business's financial numbers under its 'Other Asia' reporting segment. The segment has not achieved consistent profitability and in a statement earlier this week the company said that going forward it would only focus on "businesses that are already driving or have shown the potential to achieve scalable growth". A reported 61 Rumah employees lost their jobs as part of the decision.
The Group has consistently played second fiddle to rival portal operator 99 Group in Indonesia, with PropertyGuru's 2021 prospectus estimating that the country would account for less than 2% of group revenue by 2025.
PropertyGuru will also shut down the SaaS-based developer platform FastKey, which will cease operations in all markets by the end of October 2024.