Hello, everyone. This is Reggy Susanto, Head of Investor Relations. Welcome to the PT GoTo Gojek Tokopedia Tbk Second Quarter 2023 Earnings Conference Call. Please be advised that today's conference is being recorded. Joining us today are Patrick Walujo, President, Director, and Group CEO, and Jacky Lo, Group CFO. Also present are Thomas Husted, our Chief Operating Officer, Catherine Hindra Sutjahyo, our President of On-Demand Services, Melissa Siska Juminto, President of E-commerce, Hans Patuwo, President of Financial Technology Services, and Kevin Widlansky, Head of GoTo Logistics. Following management's prepared remarks, we will open up the call for questions. We would like to highlight that the information presented today has been prepared solely based on unaudited, consolidated, selected financial information for the three months ended June 30th, 2023. We have also submitted and published our consolidated financial statements as of and for the six months ended June 30th, 2023, that have been reviewed. The limited review was conducted to fulfill our internal standard operating procedures to improve the implementation of good corporate governance by the company. As a reminder, today's discussion may contain forward-looking statements about the company's future business and financial performance, as well as the discussion of certain non-Indonesian Financial Accounting Standard measures as complements to the Indonesian Financial Accounting Standards disclosures. Before using and/or relying on these measurements and forward-looking statements, please take note of our disclaimer and cautionary statements disclosed in our earnings presentation and press release. During this earnings call, we will be going through our results of operations and earnings presentation, which can be found on our website. For more information and additional disclosures on our recent business and financial performance, please refer to our earnings press release and supplemental presentation, which can be found on our IR website. With that, I will turn the call over to Patrick. Thank you, Reggy. Hello, everyone, and thank you for joining us today on our first earnings call together. Many of you know me already and are aware of my long history with GoTo, as well as my belief in its potential. I was an early investor in Gojek, and have been close to its founding management, as well as that of Tokopedia, from the early days all the way to the formation of GoTo. GoTo is very close to my heart, and I am humbled and grateful for the trust and support that shareholders, employees, and partners have shown in me as their new CEO, as I embark on a singular mission to accelerate GoTo's trajectory as Indonesia's leading tech company and national champion. Over the past 12 months, GoTo has confronted significant challenges, particularly around our cash burn. The extensive cost-cutting we undertook in response to this has impacted our growth, because by cutting back on incentives, we have skewed our total addressable market away from the masses towards consumers who value convenience over affordability. At the same time, integration issues have meant we were not fast enough to capitalize on the promise of the Gojek-Tokopedia merger. If we are to win, we must address all of this with urgency, as time is of at the essence and competition is intensifying. As such, there are three key points I would like to convey today. First, have no doubt that we remain committed and are on track to deliver positive adjusted EBITDA within Q4 2023, as per our guidance. As a reminder, our adjustments for EBITDA primarily consist of share-based compensation and changes in the carrying value of our investments. Second, we understand that achieving adjusted EBITDA breakeven is not the end goal. We must go on to deliver sustainable and profitable growth. If we are to win, we must increase our total addressable market by expanding our consumer base, particularly among budget customers who demand value for money. We must do this without turning to the unsustainable use of incentives, and we must also accelerate the pace of our ecosystem integration to solidify our long-term competitive advantage. To achieve all this, I have initiated a comprehensive review of our strategy and will provide an update on its progress on our next earnings call. Thirdly, in around 45 days that I have been here, we have wasted no time and started to take decisive actions across three main areas. First, we are acting with extreme discipline when it comes to costs. GoTo has reduced its workforce by 24% over the past three quarters, while also reducing its non-personnel fixed OpEx by around 10% over the same period. It equates to around IDR 1 trillion in annualized savings. There is more to do. I have asked Tom, our COO, to identify further savings to make our company even more efficient. Additionally, we are in the process of exiting our entertainment businesses, as these are no longer a core part of our strategy, and we will continue to look for opportunities to divest other non-core assets. We have also reduced our shipping subsidy cost per order by around 15% year-to-date. I am taking steps to double this by year-end, by increasing the penetration of GoTo Logistics, which currently supports around one-fifth of Tokopedia deliveries. This will enable us to drive down costs further and provide affordable or even free shipping sustainably. Second, we are improving synergies across our ecosystem, executing faster, and building stronger symbiotic relationships with our strategic partners. We have accelerated the integration between fintech and E-commerce with the launch of cash loans on Tokopedia, while offering our consumers competitive buy now, pay later products. On the partnership side, we are strengthening our collaboration and deepening our integration with Bank Jago, building additional financial products for our users, which directly translate to the expansion of bank accounts for Bank Jago, long-term reduction in the cost of funds for GoTo, and accelerated loan disbursement. Underpinning all of this is a focus on cultivating a shift in our internal culture to foster accountability, as well as faster decision-making and execution under a GoTo First approach. What do I mean when I say GoTo First? We are an ecosystem that is greater than sum, the sum of its parts. All of our employees must feel and believe this. No more silos, no more thinking about business units in isolation. For everyone in this company, including myself, GoTo must be our absolute priority. I have been very focused on achieving the One GoTo vision by breaking down organizational barriers, having everyone working from the office full-time, and committing all teams to the common goal of putting our customers first. Lastly, we have already begun adjusting our product mix, making it more mass market-focused. As I mentioned, due to the focus on profitability over the past 12 months, our consumer base now naturally skews toward consumers who prioritize convenience over affordability. To drive sustainable long-term growth, we must increase our total addressable market profitably by expanding our product offerings to address the needs of budget consumers as well. As we develop a comprehensive, comprehensive strategy for this over the coming weeks, significant work is already taking place. Within our on-demand business, we are leveraging our Hemat products for four-wheel transport and food delivery to provide a more affordable option for cost-conscious consumers, ultimately resulting in a higher order density and value creation to both drivers and GoTo. By providing these Hemat offerings, we estimate that we can grow our consumer base by 50%-60%. We are also in the process of launching our GoTransit Multimodal feature, the first and only in the region, which provides a seamless end-to-end booking experience for public transport consumers, who can be persuaded to also utilize our two-wheel services as part of their journey. Meanwhile, in fintech, we have launched the GoPay app. We designed this app not only to make life more convenient for our existing users, but also to make GoPay more accessible to budget customers by making it light in size for people for whom data and phone storage resources might be limited. We also introduced a cash loan feature that will drive the expansion of our lending portfolio far beyond existing Gojek and Tokopedia consumers. So far, we have recorded over 1.5 million downloads with zero marketing spend, showing the demand that exists for our product. In closing, I remain strongly optimistic about the outlook for GoTo. We know what we must do. We are focused on executing with precision and urgency, and we are committed to keeping you up to date as we progress. I'd like to give particular thanks to our employees and partners who have continued to work in the best interests of our business throughout the ongoing change. It is thanks to their efforts that we will succeed. I will now turn the call over to Jacky to review our business performance. Jacky, please go ahead. Thank you, Patrick. Good day, everyone, and thank you for joining us on today's call. Incremental improvements to our group adjusted EBITDA are ongoing. We are on track with our timeline to achieve positive adjusted EBITDA within Q4 2023. In the second quarter, group adjusted EBITDA narrowed by 72% year-on-year to IDR -1.2 trillion, or - 0.84% of GTV. This is underpinned by ongoing improvement in contribution margin, which remained positive at the group level in Q2, in line with our previously communicated timeline. Group contribution margin as a percentage of GTV was 0.73%, amounting to IDR 1 trillion. This equates to an improvement of 207 basis points year-on-year, and 30 basis points Q-on-Q. Profitability improvements are mainly underpinned by disciplined management of incentive and product marketing spend, resulting in a 43% reduction in associated costs, reflecting total quarterly savings of 2.7 trillion rupiah year-on-year. We also continue to improve monetization across our businesses, resulting in gross revenue growth of 6% year-on-year to 5.8 trillion rupiah in Q2, as our group take rate increased by 40 basis points year-on-year, reaching 4.1%. Net loss also improved and came in at 3.3 trillion rupiah, narrowing by 15% quarter-on-quarter and 56% year-on-year. This includes 1 trillion rupiah in losses arising from the impairment of our investments in joint ventures and associates, as well as changes in the fair value of our investments. Net cash burns reduced by more than half year-on-year. Our cash and cash equivalents of IDR 25.4 trillion at the end of the second quarter, and IDR 3.1 trillion remaining in our IDR 4.65 trillion credit facility, provide us with ample cushion to become self-sustaining. As Patrick mentioned, ongoing improvements in profitability continue to impact our short-term growth. GTV slightly declined by 5% year-on-year to IDR 143.7 trillion, mainly as a result of reduced incentives and product marketing, but also due to increased number of holidays in Indonesia during April and June. The number of profitable users and overall profitability per user remains stable, with profitable users contributing close to 75% of total GTV. User engagement has improved, as shown through an increase in spending per user of 42% year-on-year. I'll now walk you through each of our four core segments. In on-demand services, adjusted EBITDA was negative IDR 164 billion, an improvement of 89% year-on-year. As a percentage of GTV, it improved to negative 1.24% in the second quarter, up 874 basis points. With ongoing incentive rationalization, total on-demand service incentive spending declined by 35% year-on-year, which is equivalent to IDR 1 trillion in savings for the quarter. Our focus on profitability and monetization supported increased revenue, gross revenue, which reached IDR 2.9 trillion, up 3.5% year-on-year. Subsequently, our bottom line also saw significant improvement. Our international markets became contribution margin positive this quarter, as on-demand service contribution margin reached IDR 623 billion and improved to 4.7%, up 853 basis points year-on-year as a percentage of GTV. The targeted rationalization of incentives has impacted participation from low-quality users, resulting in lower GTV from this user group. As a result, GTV for on-demand services declined 8.6% year-on-year to IDR 13.2 trillion. There's also some seasonality in Q2, owing to higher number of public holidays in Indonesia, during which consumer activity slows down. We see the brunt of this impact in our mobility and food delivery services. As mentioned by Patrick, on-demand service will aim to address the need of budget consumer segments through three key products: GoFood Hemat, GoCar Hemat, and GoTransit. Our Hemat products are cheaper, not because we subsidize them, but because the inherent business model is more efficient, thanks to order batching and a managed assortment in the case of food, and more economical vehicles with more efficient routing in the case of cars. In addition, GoTransit Multimodal helps drive incremental demand to our two-wheel business by targeting users who normally use public transportation and subsequently onboarding them to GoRide for the first and last miles. These three products have generated new users and reactivated dormant users during Q2, proving our hypothesis that they can broaden the user base for GoTo. Turning to our E-commerce business, adjusted EBITDA was IDR - 229 billion rupiah, an improvement of 86% year-on-year. As a percentage of GTV, E-commerce adjusted EBITDA improved to negative 0.39%, up 203 basis points year-on-year. E-commerce contribution margin reached IDR 413 billion, and contribution margin as a percentage of GTV improved to 0.7%, up 201 basis points year-on-year. This bottom line progress is attributable to our incentive rationalization, which brought about a decline in incentive spend of 48% year-on-year, equivalent to IDR 1.2 trillion of quarterly savings. Strong progress has been made in monetization, as the commission adjustments we implemented earlier in the year have started to bear fruit. As a result, E-commerce gross revenue increased by 8.5% year-on-year, amounting to IDR 2.2 trillion. The increase in revenue is a testament to merchant loyalty to our platform, which has come about as a result of the competitive mode we are building for our E-commerce business, including the value of GoTo's unique ecosystem for merchants and users. E-commerce GTV declined 13% year-on-year to IDR 58.7 trillion in the second quarter, due largely to our incentive rationalizations, which result in fewer transactions from low-quality users. The increase in number of public holidays during the quarter also caused merchants to take longer recess periods and consumers to shop offline. The winding down of parts of our Mitra Tokopedia business, which we announced in March, also plays a factor. Excluding Mitra Tokopedia, our GTV decline would have been 10% instead of 13%. Throughout the first half of 2023, we experimented with GoTo Logistics, in-house logistic capabilities. Results have been very promising, with GTL enabling a reduction in overall logistic costs for our E-commerce business, and therefore, we'll continue to ramp up GoTo Logistics penetration in Tokopedia. Additionally, we'll immediately improve our personalized discovery through engaging content that caters to budget consumers. At the same time, we'll help our merchants to reach these consumers while supporting them in making their advertising more powerful and engaging, using new formats. Finally, our fintech pay later products will also support Tokopedia by further driving product affordability and consumer engagement. Now, looking at GoTo Financial, we have continually improved our incentive spending efficiency, particularly in our consumer payment products, while still growing sustainably. This is not a coincidence, but a result of our conscious effort to provide more use cases for GoPay users, which enable us to grow through increased user engagement instead of inorganic incentives. Adjusted EBITDA for fintech was IDR -508 billion, an improvement of 45% year-on-year. As a percentage of GTV, it improved to -0.56%, up 50 basis points. Fintech contribution margin show an improvement of 99% year-on-year. As a percentage of GTV, contribution margin improved 45 basis point year-on-year to approximately breakeven. Fintech incentive spend improved by 59% year-on-year, or equivalent to IDR 367 billion in savings for the quarter. This has contributed to our bottom line improvement and allow us to reinvest strategically into our profitable growth strategy. GTV increased 4% year-on-year to IDR 90.5 trillion in the quarter. Gross revenue also increased by 2% year-on-year to IDR 399 billion. We remain very prudent in lending. We grew our loan book by 21% quarter-on-quarter to IDR 1 trillion, while maintaining a positive contribution margin. Our strategic partnership with Jago remains crucial, with the majority of our loan book financed by Bank Jago. On top of being profitable, our lending products are also more competitive because we are able to manage our credit risk very effectively. We are still in investment mode for our fintech business. As we scale our lending in both closed and open loop systems, we expect fixed costs for the segment to increase in the short to medium term. For GoTo Logistics, adjusted EBITDA was negative IDR 94 billion, an improvement of 62% year-on-year, and gross revenue increased by 10% year-on-year to IDR 562 billion. Early results from our efforts to improve the logistics business cost structure are also showing. In the second quarter, we reduced incentive spending for logistics by 64% year-on-year, equivalent to IDR 122 billion of savings for the quarter. The first priority for GoTo Logistics upon formation was lowering logistic costs for our E-commerce business by scaling up our highly efficient in-house delivery service and our fulfillment capacity, as well as allocating orders to the most cost-effective third parties, using our in-house engine for orders that are better served by external vendors. The more we can lower user-pay logistic costs, the more significantly we can reduce our shipping subsidies to incentivize budget consumers, bringing a multiplier effect that supports profitability and business sustainability, as well as growth. Similar to GoTo Financial, we are still in investment mode for GoTo Logistics. Given the strategic importance of lowering delivery costs for our E-commerce business, as we scale up fulfillment and conventional delivery, we expect to see some cost increase in the short to medium term. That said, we'll continue to aim to stay as asset light as possible. Before opening the call to your questions, we would like to reiterate our guidance. We continue to expect to reach positive adjusted EBITDA within Q4 2023. For the full year 2023, we are revising our guidance due to significant progress we have made in the first half. Our group adjusted EBITDA is now expected to be between negative IDR 4.5 trillion and negative IDR 3.8 trillion, an update from our previous guidance of between negative IDR 5.3 trillion and negative IDR 4.6 trillion. To conclude, our cash position is strong, and we'll continue to focus on achieving profitability while investing in sustainable long-term growth. With that, we would now like to open the call to your questions. Reggy, over to you. Thank you, Jacky. We will now start our Q&A section. Please use the raise hand function to ask your questions. Please wait a moment while we assemble our roster. The first question comes from Ferry Wong from Citi. Please go ahead, Ferry, and ask your question. Yeah. Hi, thanks, Reggy. Yeah, I have three questions. Thanks for the opportunity. Yeah, the first questions is that there seems to be a slower improvement on profitability in this quarter, compared to the previous quarter. You mentioned that you are still confident to achieve the Q4 2023 adjusted EBITDA breakeven. Could you please highlight the main driver to achieve this target? Second, basically, as we approach adjusted EBITDA profitability by the end of the year, do we expect that the margin take rate will improve further? Should we expect investment to maintain at current level to defend market shares, especially with the intensifying competition from TikTok and Lazada and potential entrants of Temu? What is your estimated long-term adjusted EBITDA margin potential for each of the segment? The third questions is more on the GoTo Financial loan outstanding as of June. Could you provide more color into that? Because in the first quarter, you mentioned that the loan outstanding from GoTo Financial ecosystem reached around IDR 831 billion. From Bank Jago, we heard that it's around IDR 1 trillion as of June. What will be the number, basically, by the end of the year, and what's your expectation also in 2024 for this GoTo Financial loan ecosystem? Thank you. Ferry, thank you for the questions. pleased to hear your voice here. In regard to your first question, and if I can just recap, the, you, you have a question about the slowing down of our path to profitability, this quarter versus the previous quarter, and how confident we are that we will achieve our target of EBITDA pro- breakeven by fourth quarter. Firstly, firstly, let me say that we are committed, and we believe we are on track to deliver positive adjusted EBITDA within the fourth quarter this year. Due to the significant progress we have made in the first half, we have improved our group-adjusted EBITDA guidance for the full year of 2023. In order to achieve this, we are disciplined in terms of cost. We have IDR 1 trillion in annualized savings through the reduction of personal costs and non-personal costs. We continue to be very selective in spending incentives. We have decreased 43% year-on-year this quarter. Furthermore, I have asked the P&L optimization committee to continue identifying further savings, reviewing cost items line by line that will make our business even more efficient, as well as exiting our non-core businesses. I'll give the opportunity to Tom Husted to elaborate further on this matter. Tom, if you will. Great. Thank you, Patrick, and thank you, Ferry, for the question. Good afternoon, everybody. It's great to be here and to join the call for the first time. As Patrick's mentioned, you know, we've made very good progress on cost cutting so far. However, I, I really wanna highlight here that we're gonna remain laser focused on reducing our fixed cost base in the coming months. To this end, we're working on three distinct work streams internally. First, we're gonna continue to rightsize the expense base, and this is really focused primarily on reducing the costs that are not essential to the core businesses. Patrick alluded to some asset sales earlier in his, in his remarks, and we will continue to do those. The benefit of doing those asset sales is that we also reduce the associated OpEx. The second strategy, this is something that I think everyone is focused on now internally, which is revisiting the Toko-Gojek post-merger integration work. This goes back to 2021, really what we wanna do here is double down on streamlining how these businesses work together, including GTF. Our view on this is that we have to realize a lot more savings from this work stream. Frankly, at the same time, we have to drive the associated revenue opportunities and the flywheels. I think, I think, Patrick and Jacky will speak a bit more about this going forward. Then finally, we have a third strategy, which is to focus on technology independence. Really what this means is that we wanna decrease our reliance on third-party tech solutions. We've done a deep dive on how much we're, we're spending on, on these solutions, and, and it's big. We're gonna, we're gonna redeploy some of our internal tech team and work on solutions that make us more lean operation. The goal here, overall goal, is to reduce the costs on a per transaction basis. This will help us increase the TAM and get more customers in on a profitable basis. I, I think that summarizes the overall cost strategy. Thank you, and, Patrick, Jacky, back to both of you. Thank you, Tom. Moving on to the second question from Ferry. I think the question is around our view about EBITDA profitability and margins going forward for each of the business segments. Ferry, as I mentioned earlier, that achieving adjusted EBITDA breakeven is not the end goal. We need to go on to deliver sustainable and profitable growth. We believe there's still a lot of room to improve our margins further beyond breakeven, and maybe I can talk about a few observations that we have made in the company. In on-demand services, based on our hypothesis and early results, our Hemat products have better profitability than our existing products. We will take time to test this hypothesis, and once we are convinced of the results, we are going to invest more in this product. For E-commerce, our hypothesis is that we will need to improve our assortment. We need to appeal to budget customers and expand our total addressable market. By doing this, we will also be able to open new opportunities for our lending products to tap into these budget customers. Overall, by improving our offering to address the needs of budget customers, we will increase our total addressable market, and at the same time improve our profitability. As I mentioned in the first part of this presentation, or in... We are in the process of doing a comprehensive study on GoTo strategy, and we will provide an update in the coming quarters. The third question is about GoTo Financial, GoTo Financial. I have Hans, who is the President of GoTo Financial. Hans, if you can address Ferry's question, that would be great. Will be happy to. Thanks, Patrick. Hey, Ferry, thank you for your question. The loan outstanding in Q2, it was about IDR 1 trillion. This reflects about a 21% increase on quarter-on-quarter. This is a little lower than it was in previous quarters, partially because we continue with our prudent approach, also partially impacted by the negative growth in the ODS and E-commerce businesses. If you look at a 20% Q-on-Q growth, this is still significantly higher and implies a higher penetration rate compared to the overall negative growth in the ODS and E-commerce businesses. Moving forward, we remain very confident. As we have more and more experience on the cost of credit, we are monitoring and continuing to improve and optimizing our prudence, which means we are able to bring on more, more borrowers. In addition to that, we have launched two new products, right? We have launched cash loans in Tokopedia, fairly recently, and we are also now in the process of launching cash loans on the GoPay app. Two additional new channels for, for cash loans have been opened up this quarter. Hence, we expect that an acceleration in the loan outstanding in the quarters to come. Everything that we do, we work together in a strategic partnership with Bank Jago to manage the cost of funds, and also to accelerate the loan disbursement. Hopefully, that answers your questions, Ferry. Thanks, Ferry. Our next question comes from the line of Ryan Winipta from CGS-CIMB. Your line is now open. Please unmute your microphone to ask your questions. Yeah. Hi, thanks, Reggy, and also the management team for the opportunity. I have three questions from my side. My first and ssecond questions would be specifically to Patrick, as the new CEO. I'm just wondering whether there's any potential key changes in the strategic direction and action from you, Patrick, and what do you think needs to be resolved quickly? What kind of problems and concerns did you see previously as a shareholder before, and now as a CEO of GoTo Group? My second question would be on the given that you are also the founder and also the managing partner of the Northstar Group, do you see your role as a CEO in GoTo as a full-time commitment? How should we think about that? My third question would be, I think it's just a reiteration of what Ferry mentioned previously, is regarding whether how management can balance between the growth and also profitability at the same time in our second half onwards, because of the intensified competition. I'll stop there. Thank you. Thank you, Ryan. Maybe I'll address the second question first. Because that's about my commitment to GoTo. I would just like to give everybody an assurance that my effort and attention are 100% devoted to GoTo. I will commit to GoTo as far as it lo- as far as it takes. A lot of the things, the initiatives and all the push that we are making in the company are long-term in nature. Again, I'm, I'm fully committed to see to push that. At the same time, if there's somebody who walks in and can do a better job than I can, I would be more than happy to work with that person, to hand over and bring this company to the next level. Right. Again, at this moment, I'm fully committed to GoTo. Your first question is about changes in strategic, strategic direction and the problems that I see needed to be fixed immediately or resolved quickly. Generally, I think our strategic direction remains the same in the c- in, in the sense that we are still committed to deliver EBITDA breakeven by fourth quarter. The bigger challenge is that how do we actually grow profitably from here on amid intensifying competition? As, as we have discussed, we are looking to further reduce our fixed costs, and then we will use the savings to invest in areas that matter for us to be able to achieve profitable growth. The second thing is that, and I cannot stress this, enough, that we are cultivating GoTo First approach, improving synergies across our ecosystem and strengthening collaboration with our strategic partners. GoTo is unique because we have a suite of products that none of our competition has in an ecosystem, and it is up to us as to how we want to leverage that and how fast we want to, to get there. Therefore, as I mentioned earlier, that sharp and speedy execution is critical. The third component of this is we need to augment our total addressable market. We need to be able to appeal, to make our products appeal to, to people who are seeking budget, people who are seeking affordable products. We continue to be focusing on that. I think the, the, the, the last question that you have is about competition and how we react to it, and our strategy to reignite growth while staying on track on the path to profitability. Today, apart from Hans, I have Catherine, who is the President of our Indo On-Demand Services, and Melissa, the President of our E-commerce, also known as Tokopedia. On that note, I would actually give the opportunity to each of them to share with you their strategy. Cat, why don't you start first? Thanks, Patrick. Thanks, Ryan, for the question. Catherine here. Nice to meet everyone. Yeah, on on-demand services, as you noticed as well, Ryan, that we have seen in the recent months, competition has been growing more aggressive. A few things I would like to mention on the on-demand services, that we mostly known as Gojek. First thing is we are still maintaining market leadership in both our Indonesia transport and food delivery market. Secondly, Patrick alluded to this earlier as well, that we are now going after ways to augment our user base by going after this affordability strategy to address the budget consumers. Our analysis showed that we can drive our market potential growth by expanding our reach to this segment of users. As Jacky mentioned briefly as well, that the economics of this, what we call the Hemat product, which is translated to value for money, has been proven to be good as well. Therefore, we will continue to focus on our strategy to make our services more accessible, to be more suitable for the affordable segment. Both our food delivery through GoFood Mode Hemat and our GoCar through GoCar Hemat, providing a cheaper entry point for our consumers if they are willing to sacrifice on or compromise on few things. For example, to wait a little bit longer, to take on a slightly smaller car, to choose for a more nearby assortment for food. Similarly, as well, on our two-wheeler services, we are launching our GoTransit Multimodal, which is a very seamless way, first of its kind, integrating between the public transport and ride-hailing with one tap. This is gonna be our strategy that we will push aggressively to address this affordable segment. With that, I'll pass it to Mel to address a little bit on the E-commerce side as well. Thanks, Catherine, and also thanks, Ryan, for the question. For E-commerce, overall, around 60%-70% of our market share in Indonesia is actually shared between the two largest players. Both players have been reducing incentives, although we have seen our competitors becoming more aggressive in recent months. I also would like to mention that there are two types of E-commerce. The first one is the traditional E-commerce with search-based product discovery. The second one is E-commerce focusing on content-based business, utilizing live streaming to drive transactions, especially in the area of impulsive, kind of, transactions. Far, we have been focusing a lot on our core strength and capabilities in traditional commerce. We are building product propositions to appeal more to budget consumers through improving our top requirements, especially doubling down on AI to actually improve on personalizations, as well as using GoPayLater to make our products more affordable and appealing to much more budget consumers. W e internally are conducting a strategy review, and we'll provide more color in the next earnings call. Thank you, Ryan. Our next question comes from Pang Vittayaamnuaykoon from Goldman Sachs. Pang, your line is now open. Please unmute your microphone to ask your questions. Hi, good afternoon, all the management, and thank you very much for the opportunities. Can we also go back to the questions I know that we've been asking about here a couple of times, the dynamic in E-commerce segment? Just wanted to have, like, clear understanding here in term of the focus for Tokopedia. As we move to a second half of the year, and as you just mentioned, that some of the competitor actually begins to be more aggressive toward the later part of the second quarter and into Q2 as well. Are you going to focus on turn profitable first still, or the plan is also, to the certain extent, to defend market share as well? That's question number one. Question number two, for the on-demand segment, the dynamic that you've seen between mobility and food deliveries, if there's any color you can provide in terms of GTV growth between the two products, how do you foresee this trend into the rest of the year, given also that the number of orders seem to have coming down? As you push toward profitability as well, same here, will you focus on profitability first or defending market share first? Lastly, can we also have more colors around the Hemat strategy that you are introducing, and if you've been seeing some success, what is the margin profile for this Hemat versus your legacy products? To answer your question, Pang, and i f it is not clear, please ask again, because I may have forgotten... I may have forgotten some of the questions. In terms of, in terms of E-commerce, the way we look at the business is that there is actually, the market is actually still has a lot of potential. If we look at the penetration of E-commerce in Indonesia compared to China, we are only half of the rate of the penetration, and in, in terms of frequency, we are one-third of what Chinese consumers are consuming today. The, the, the market is still wide open. Yes, we recognize that there are, we have, we have a lot of competition in existing and new ones. There are certain things that Tokopedia still has a lot of potential to improve. The first one is that we need to make our assortment larger and more appealing to a larger base of the population. If you look at our type of customers, Tokopedia today appeals most to the most affluent market in big cities like Indonesia, because especially because of the integration that we have with our on-demand services, where we can deliver products to our consumers within two hours, and I still believe that we are probably the only one that can offer that kind of service. Tokopedia has a special appeal to that customer base. However, the biggest growth potential is what we call the budget consumers or the mass, or the mass market, right? Apart from, apart from assortment, the second thing that Tokopedia is reviewing is also about category strategy. We have, we are, we are strong in certain categories. We have a lot of potentials in other categories that we are not present. What, what we, what I'm trying to say is that even within our current business, we still have a lot of levers that we can pull. Now, it's all when it comes to deliver, to the delivery of that, it all depends on execution quality. I think, you know, sitting here, I've been being here for only 45 days, I think I'm assured, pretty assured that the team in Tokopedia are capable of pulling this. Not to talk too much details, because we will talk about this in the next, in the next earnings call. I have personally seen early signs that we, that the team has found new lever, new lever, new levers for growth. Together with the team, We are, we are taking comprehensive study to see where the gaps are, and then we will fill those gaps. We are not perfect. We have a lot of things to catch up, but we will, we will address them. We hope to, to provide you more details in the coming quarters. Now, I don't remember the second question. Maybe because Sorry. The dynamic, the dynamic between mobility and food delivery. Okay. Maybe, yeah, I'll hand this over to, to, to Catherine to address. Hi, Pang. Good, good to hear from you. Maybe I'll address your, your second question, and I'll come back to that one, right? I think you're asking, how does the Hemat work? Let me take a little bit of an example. For example, the car Hemat, right? Car Hemat, basically, what we are providing to the customer is an options, options of a very clear value proposition of a GoCar Regular versus GoCar Hemat. Regular is the product that we always have, before, right? For GoCar Regular, the car- if you order a GoCar, the car that is being assigned to you is the normal, regular car. If you order a GoCar Hemat, we will assign to you what we call economical car. This is a smaller, the smaller car, right? Similarly, as well, your waiting time for the car will be five to seven minutes, slightly longer. That will allow us to allocate, a more efficient, cost-efficient, car as well for us. Lastly, is also the distance. With the car regular, you can travel, pretty, length, long distance, for a GoCar Hemat, you can only travel up to 10 kilometer. This is to make sure we can create, such a density for our car driver, so they can increase the, the productivity of the driver as well. With that, basically, the proposition is if, as a customer, you're willing to go for a smaller car, you are willing to go wait slightly longer, your price then comes down by, 15%-20% cheaper compared to the car regular. This is back to Jacky's point earlier, that this model that we are doing, the Hemat, is economically sustainable, and thus, we will be able to expand them and scale them very fast after this. Similarly, for the food Hemat as well, a customer can have a choice within the assortment. If you choose food Hemat, you can only choose assortment within first two km, your nearby merchant, similarly, to promote the density of the order. The secondly is also the waiting time. If you order the GoFood Regular, the average waiting time is 25 minutes, but when you order GoFood Hemat, the waiting time can be up to 45 minutes. This will help us to increase the probability for us to be able to order batch and improve the driver productivity by increasing the density. Similarly, with that, the delivery price for our GoFood than for the regular, typically now is from IDR 9,000-IDR 11,000. Now, with the GoFood Hemat, you can lower down the delivery price by 1/3 of it, which is IDR 3,000-IDR 5,000. Again, this is, this is basically how we are doing it to provide a sustainable kind of a growth lever for us to expand our customer base. I have a question on the- Margins. The margin. Yes. Lower price does not mean that it's gonna be a lower profitability margin. Again, where, as I mentioned, because using the car, for example, Because it's economical car, as you can imagine, the driver main cost is their fuel, and second is their cicilan, the, the installment for their car payment, right? As you can imagine, when the car is smaller, more economical, the fuel efficiency typically are better, and as well as their monthly installment is lower. This what allow this win-win-win kind of a, a combination, that the driver can take on slightly less, that still help them to maintain their take-home income still. At the same time, we will be able to pass on some of the saving for the customer, to allow them to have a cheaper product. yeah, it's not necessarily mean that it's, because it's more affordable, it's a less, the more profitability. Yeah, I think, generally, generally speaking, all of the drives to affordability does not necessarily mean that we are going to have inferior unit economics for those products. Because it is, we are creating those products with fundamental change of the business model or the way that we are doing business, our cost structures would also go down commensurately with higher volume. Therefore, from, from unit economics perspective, the early signs convince us that these products are actually more profitable for, for GoTo. Thanks, Pang. Our next question comes from the line of Sachin Salgaonkar from Bank of America. Sachin, your line is now open. Please unmute your microphone to ask your questions. Thanks, Reggy. Congrats on a good set of numbers. I have three questions. First question was, you know, more regarding, you know, when do we see GTV bottoming out from a YOY growth? You know, listening to all the comments from management, it's very, very clear the focus on cost control is there, and, you know, clearly there is a visibility of further cost control. Just wanted to understand if it is coming at the expense of, you know, GTV growth, and when, when do we see, you know, that growth, sort of bottoming out? Number two, you know, wanted to understand the impact on competition. We did see a bit of an improvement in take rate this quarter for E-commerce, largely flattish for, you know, on-demand services. Directly, do we see further room for improvement in take rate? Or, you know, given where competition is, we don't see much of a, you know, pace of improvement. Third question, just wanted to understand your thoughts on, you know, the government looking to regulate the cross-border commerce by imposing a $100 cap? For your questions, the first part is about GTV, GTV growth, right? Where it's bottoming up, and when, and how would that be affected by competition? Let me just say that there are things that we have control over, and there are things that we don't have any control. What our customers, our competition is going to do going forward, I think if... My answer is that if they depart significantly from the practice that they have, we have seen in the past few months, and to become more aggressive, and the capital market or the investors tolerate that, you know, obviously, that would put more pressure on our GTV, growth or improvement. I think I would not want to comment to exactly we are going to see our GTV turning around, if you will, from this level. What I can say is that all the initiatives that we just talked about, we are seeing early signs that it will generate GTV growth from our level where we are today, right? Again, we think that it is, it is still too, too early to, to predict. Hopefully by our next earnings call, we will be able to give you a little bit more clarity on, on that. Then, Jacky, would you like to take the second question? Sure, yeah. In terms of the take rate, on-demand service, it was flat quarter-on-quarter. I think the major reason is because of the holiday season. That's shifting the mix towards the enterprise merchant for food delivery. That's kind of impact, because the take rate is lower, so and offset by the increase in the mobility side, so that's kind of result in a flat quarter-on-quarter. In terms of E-commerce, we increased the B2C commission rate in March, so that's the full quarter impact in Q2. There's also a mix shift in Q2, slight increase in the digital goods. I think that's kind of offset that in, in improvement. Overall, I think going forward, we'll continue to leverage, like, value-added services to, such as, like, ads to drive. Specifically for E-commerce, I, I think that's has been a contributor and growing, like, at a fast pace, so we'll continue to leverage that to drive the E-commerce take rate. For on-demand service, the ads contribution is still relatively small, but we see a lot of opportunities in that area, so that will help to drive the on-demand service take rate as well. I think, I think just general comment, I don't think that we are banking on increasing take rate from our on-demand services to drive growth. That is actually contrary to our strategy to make our pricing to become more... Our services to become more affordable to our customers. At some point, the products have become too expensive for the general population. As we mentioned a few times in this call, the engine for growth is actually going to be about our products, new products, that are going to be more affordable to our customers. I think that is true for E-commerce. I think the focus on E-commerce is not only to make the assortment more affordable and shifting categories to those that are more lucrative for Tokopedia, but also working with our merchants to make sure that by working with Tokopedia, they can generate more sales and more profit to their business. The third question is about the regulation, the government regulation on cross-border, about the limit of the goods that can be directly imported. At GoTo, we are not doing any cross-border transactions. We are monitoring updates to the regulations and the implementation of it. I think, generally speaking, we are going to continue to be compliant with all prevailing regulations. Thank you, Sachin. With that, we have reached the end of the question -and -answer session, and we conclude our conference for today. Thank you for participating.