Joint Stock Company Kaspi.kz (NASDAQ:KSPI) Q4 2025 Earnings Call Transcript

Joint Stock Company Kaspi.kz (NASDAQ:KSPI) Q4 2025 Earnings Call Transcript March 2, 2026

Joint Stock Company Kaspi.kz beats earnings expectations. Reported EPS is $3.37, expectations were $3.1.

Operator: Hello, and welcome to the Kaspi.kz and FY 2025 Financial Results. My name is Harry, and I will be your operator. [Operator Instructions] I would now like to turn the call over to David Ferguson with Kaspi to begin the presentation. Please go ahead.

David Ferguson: All right. Thank you, Harry. Good morning, good afternoon to everyone on the call. Welcome to Kaspi’s Fourth Quarter and Full Year 2025 financial results. I’m David Ferguson from Kaspi. As usual, I’m joined by Mikheil Lomtadze, CEO and Co-Founder of Kaspi; Tengiz Mosidze; and Yuri Didenko, the Deputy CEO of the company. We’ll take you through the strategic highlights financial results for the final quarter of last year and provide guidance for this year, and then we’ll open up the call to Q&A as usual. So on that note, first of all, I’ll hand over to Mikheil. Mikheil, over to you.

Mikheil Lomtadze: Hello, everyone. Yes. Thank you, David. So let’s move straight to the presentation. So our results for the year have been quite strong. We’re obviously reviewing the underlying performance without the influence of external factors. But at the same time, I do think that we are at the stage when we can continue investing into long-term growth and value creation, which we always prioritize and also distribute the — and resume the dividends, considering the strong cash generation, which our business model allows. So we are proposing a dividend of KZT 850 per ADS, subject to shareholder approval. The performance itself of underlying performance has been quite strong. Our net income has grown 18% percent without the impact of some of the external factors which we’ve discussed during the year.

Those are the smartphones, sales reductions and shortage of supply, some tax changes, minimum reserve capitals and the interest rate — high interest rate environment during 2025. And in spite of those if we include those factors would — our net profit consolidated grew around 10% and underlying profit grew around 18% during the year. Next slide. In terms of the last quarter, last quarter, considering all the headwinds still was quite solid. Underlying performance and the net income growth reached 13%. We have had good, reasonable growth across all our businesses and some of the most important metric for us, which is consumer engagement. And one of those is monthly transactions proactive consumer. It’s 7 monthly transactions per consumer, which is, we believe, is a world-class indicator and very few businesses can have such consumer engagement and that is an important metric, which going forward, we can create more value for the company.

David will cover some of the verticals further. But in general, we’re pleased with performance in a quite challenging environment in 2025. The biggest asset we have or I would say, the reflection of the quality of our products and services is our brand. And our brand is #1 consumer brand pretty much in every category and by wide margin. So here, you can see just some of the selected metrics, which just tell you how strong our brand is. For example, the mobile application installed on your phone, almost half of the respondent service during the year. are having our mobile application on their smartphone considering, which is 6x more than the nearest brand. And the same sort of wide margin in payments were like 13x the second brand, e-Commerce, 3x, travel, more than 4x.

And we have a very strong position in the cars, for example, 9x the nearest brand. And that’s an important asset. That’s something which notwithstanding what’s going on around the terms of the external factors, which unfortunately are not entirely under our control, things we can control and things we execute on our are reflected in the consumers using our products, merchants using our products and the brand indicators. So the trust that we have from the consumers and the merchants is extremely important for us, and that’s the reason to create the value [ later ] and just testament to the management really being extremely focused on the quality of our products. Another example of how this quality is actually reflected in some of the innovations is the Pay-by-palm, which Kaspi Alaqan, which we just launched under 90 days.

And clearly, we have unprecedented adoption, I think very few markets in the world can showcase such an adoption of the innovative service. So we have now almost 0.5 million customers in Almaty registered for with Kaspi Alaqan almost 6,000 merchants are accepting our payments through the Alaqan and that’s almost 10% of the of the transactions in the stores where we have been merchants connected to Alaqan. So it just tells you that Pay-by-palm, it’s truly changing the consumer behavior. So we have changed consumer behavior from cash to cashless to the mobile payments then to the QR code and now to the Pay-by-palm. So we believe Pay-by-palm has a bright future. Adoption has been remarkable. Consumer feedback has been remarkable. Everybody is really super excited and achieving 10% penetration at the merchants just in three months and having 0.5 million customers, by the way, to put the 0.5 million customers into perspective.

This is almost third of the population of the largest city of Kazakhstan where we started to launch. We are only in one city at the moment, and we’re scaling city by city across the board during the year. We’re replacing the old network, and we’re installing the new devices, which are equipped to accept all kinds of payments and are purposely built for Alaqan. As being an innovative company, that’s a testament of how consumers are using every your next product, and the penetrations were again achieving are unprecedented, remarkable. And in just three months having 1/3 of the population in the largest city registered in the service. That’s really very encouraging. We’re extremely happy and we’re just focused on really an execution and replacing the old network with the new devices.

I also would like to walk you through some of the penetration numbers, which we have across all our services now. This is our key services. You don’t really have here all our products and services. But just to give you — just to give you an overview, the payments being the highest penetrated. We still believe that B2B payments has a huge potential, and there is a range of innovations, which we have been rolling out during the last year and some of the services we plan to do this year. E-Commerce, in general, we believe, will be the driver for the growth. E-Commerce is something where we create the most value for both the merchant and the consumer. E-Commerce is when merchant is making the decision to sell something pretty much anywhere across the country and then hopefully in other countries.

And then consumer is making a decision to buy something. So it’s a front end of consumer and merchant relationship all the services around e-Commerce like delivery, advertising, value-added services around financing payments. So when merchant sells, it needs to get the financing. When consumer buys, it needs to pay for it and the merchant accept the payments. So all the universe of our services is highly applicable to e-Commerce. So e-Commerce is our important focus, and it’s focused in Kazakhstan, and it will be focused in Turkiye as well. And then, of course, merchant finance, which has been the fastest-growing product had delivered an advertising, which we’re scaling very responsibly. Again, we want to make sure that delivery is not going against consumer in terms of the organic search, for example.

So the results have to be high and relevant, high accuracy, but we have a very strong results, and David will show you the take rate is increased due to the value-added services of delivery and advertising, which we have launched. And on the consumer side, only for our m-Commerce using e-Commerce and as we get more merchants migrating to e-Commerce, especially from m-Commerce, when we have more consumers and the more selection and more price competitiveness, which we have been driving. We are regarded as one of the lowest and the best price e-Comms in the country. So that really drives the liquidity of the transactions. And of course, e-Grocery, which we are scaling across the country that it grows to is the fastest-growing e-Commerce business for us.

So those are the things which we’ll be focused during the year, and they will be driving our growth and the Kaspi Delivery and Kaspi Advertising being highly scalable, high-margin businesses will contribute to the to our profitability. Next slide is about Turkiye. So I just want to spend really more time about our progress in Turkiye. So as you can see from this slide, our focus has been the growth of number of orders, and we have been focused on growing the number of orders through growing consumer engagement and consumer engagement, in our case, is a very simple sort of metric, which talks about the health of our services. And we would rather have 1 million basically of the engaged consumers, which frequently transact with us and are coming back and love our service, then have 10 million consumers which are one-offs because of whatever the promotion onetime promotion or some other temporary benefit, which after that they leave.

So we are focused on engaged consumers. Engaged consumers will drive future of the business. That has been the playbook and in Kazakhstan. It will be the same in Turkiye. We have tested different parts of our models, then I’m really happy that all those — our expertise and technology in the personalization, in search, in the marketing and improvements in delivery, they are giving and yielding very similar results. And this is an example we have been growing our orders quarter-on-quarter. And in the fourth quarter, we had the 19% growth, which is a very high growth for some time already for the company. In terms of the — some other improvements or improvements, which we have received during the year is all our efforts around again, which I mentioned, the consumer engagement, so engaged number of purchases, I’ve mentioned, increased 19%.

We are not focused on growing monthly active consumers, right? So — but we’re really happy that once the active consumer will grow 15%, which is a very good number in the fourth Q. But what is more important for us is that the growth of engaged consumers have been 29%. And those are the consumers which repeatedly buying with you and those are the ones which generate the value. And then, of course, we understand the relationship between the quality and speed of delivery with the customer happiness and the growth of the business. So next-day shipping, we have improved also coverage from 47% to 63%. So those are not all metrics we’re working around, but those are the ones which just give you a bit of a flavor what really we’re focused on. And again, growing engaged consumers, growing number of purchases is for us the very important focus, which results in all the investments and the time we’re spending on key components of that, right?

Again, that is about personalization, meeting customer demands within the right product in the right time, through the right channel, then we have marketing and we have focused on delivery and the quality and speed and broadening the payment options. And the broadening payment options means actually that the customers can buy more items more affordably. So all those things working together, give us these results. We’re very encouraged and are really focused on — we just focused on continuously bringing the Turkiye and Hepsiburada metrics to Kaspi. So if you look at the — and compare the Kaspi and Hepsiburada metrics, those are the ones which just give you a view of this, what we call sort of engagement opportunity, right? So if you think about compared Kaspi and Hepsiburada those metrics, you can see that active consumers in Kaspi is 7.4 million, which is — and Hepsiburada, 11.8 million, which — so Hepsiburada, has 1.6x more consumers.

However, GMV per consumer is 1.6x less in Hepsiburada than in Kaspi. And then if you think, okay, what is actually driving such a difference, one simple metric that the frequency of purchases in Kaspi is almost 4x more than in Hepsiburada. So in Kaspi, 24 purchases per consumer per year and 6.7% in Hepsiburada, And then when you think, okay, what drives that purchases which are translated into profits, is actually the engaged consumers that are coming repeatedly and the costs related to those consumers are more and more sort of efficient, right? The consumers are coming back. There is limited marketing costs and so on and so forth. So 66% growth of engaged consumers in Kaspi despite of its scale continues to grow and Hepsiburada with opportunity in front of it, 29%, so 2.3x less.

So again, everything we do is we are focused on growing the number of engaged consumers, growing right number of frequency of purchases and introductions, and those will result in the economics and profitability going forward. And that’s our strategy. In 2026, we’ll manage Hepsiburada around Turkiye business around EBITDA breakeven, and we’ll continue targeted investments. But we also believe there is a question always from investors, can you continue developing Hepsiburada and the Turkiye and at the same time, resuming dividends and returning capital to shareholders? So the answer is yes. And we’re resuming that. And now we’re comfortable with all the things we have actually tested that we’re in the right path, and we’ll just continue executing to deliver the world-class services to consumers and merchants.

I’ll get back to you.

David Ferguson: Great. All right. So thanks a lot, Mikheil. So let’s run through the respective platforms. So first of all, payments in Kazakhstan, a TPV growth of 14% year-on-year in the fourth quarter, 19% for full year ’25. So that is pretty much bang in line with the guidance of around 20% TPV growth for the year driven by solid trends and solid and consistent trends in transaction volumes of 12% for the fourth quarter and 14% for the full year. As we’ve talked about many times before, a slight take rate attrition, and that’s just the result of Kaspi Pay and Kaspi B2B lower take rate products growing in share. So the combination of decent TPV growth with some take rate dilution is slightly lower revenue growth at 7% in the fourth quarter and 12% for the full year.

It’s just the natural flow through there. And overall, the more moderate rate of growth just reflects the scale now of this business. At the bottom line, a 4% growth in the fourth quarter and 13% for the full year. I’d just say to keep in mind on the fourth quarter, it was at least in part impacted by some of the costs related to the launch and scaling of Alaqan. So that will sort of normalize as we go into this year. Moving on to marketplace in Kazakhstan. So Underlying growth, strong, 12% in GMV growth in the fourth quarter, 19% for the full year. If you — that’s after the effect of smartphones, sort of pre-smartphones, 11%, and that’s just slightly lower than the full year guidance of 12% to 14% the GMV growth. On that, I would say, and I guess this would be a question.

There was no improvement at all in smartphone dynamics in fourth quarter. GMV from smartphones was down around 24%, which is pretty consistent with the year trend. So that’s the explanation for Q4, although what I would say more encouragingly, having been down materially throughout or since March of 2025. smartphone category did return to growth in January of this year. And from March, we just have a favorable year-over-year comp. So we do expect that sort of growth in marketplace to normalize over the first half of this year and that smartphone issue to be a 2025 issue rather than a 2026 issue. So that’s on GMV growth. If you look at purchases, purchase is very strong and consistent at 34% in the fourth quarter, 35% for the full year. So not really impacted to a material extent by issue and you see that demand is strong.

And as Mikheil talked about, you also see the ongoing trend of take rate expansion. Take rates across the marketplace and specifically e-Commerce hitting gold time highs driven on the back, particularly of advertising and delivering those value-added services. If we look specifically at e-Commerce, the fastest-growing part of marketplace, 9% GMV growth in the fourth quarter, 16% for the full year. It’s e-Commerce that’s really impacted by smartphones and that sort of pretty obvious when you look at x smartphones 27% GMV growth for full year ’25. Again, same point on purchases. If we want to look at sort of real demand on the e-Commerce platform, growth in purchases up 70% and 83% the fourth quarter and full year, it illustrates that demand is strong.

And as we’ve said in sort of prepared remarks, the competitive position of the e-Commerce platform is unchanged. The smartphones was a very sort of specific anomaly, take rate hitting 13.1% for the fourth quarter and 12.7% for the full year. So again, that point an all-time high take rate, driven by advertising, driven by delivery. And here you see that advertising growing quickly, up 45% year-on-year in the fourth quarter and up 64% for the full year. We talked on our last call about some of the new advertising products that we launched at the end of last year, and they’ll be very helpful for sustaining decent advertising growth both this year and into the medium term. The other driver of e-Commerce is also grocery, which, as Mikheil said, is the sort of the fastest-growing major product line that we have.

Growth really not slowing down at all, up 53% for the GMV growth of 53% for the year and number of consumers now well north of [ 1 ] million approach B14 million. So continuing to scale very, very nicely. And again, would expect grocery to keep posting very, very decent growth into the medium term. Part of the reason for our success in e-Commerce is actually a result of the m-Commerce business. So this is sort of a bit more color on the dynamics within marketplace. What you can see here is that migration of both merchants and from merchants and consumers from commerce to e-Commerce is taking place now at a very rapid rate here. It’s just two sort of vertical examples. M-Commerce, GMV down 5% and for shoes and clothing category, but e-Commerce GMV up 103% or for the health and beauty category.

M-Commerce growth of 1%, this is for full year ’25 versus for e-Commerce growth of 62%. So of course, this means lower growth in m-Commerce, but the value even when m-Commerce isn’t growing is that you’ve got those relationships with off-line merchants through m-Commerce, through the other products and services that we offer and you’re their first point of call as they migrate their businesses online. And that’s something pure online only e-Commerce players do not have. So this is a material sort of competitive advantage. Having said that, I mean, you shouldn’t assume that commerce is completely sort of tax growth if we ex out the smartphone issue for last year, it still delivered 11% GMV growth of 7% including smartphones and minus 4% growth in the fourth quarter, including smartphones plus 3%, excluding.

But the m-Commerce will be one of the things that drives the growth in e-Commerce. And longer term, e-Commerce will just naturally evolve around the more services part of the economy, which doesn’t migrate to e-Commerce, restaurants, beauty salons, gyms, those kind of areas, but that’s over the sort of the medium term. m-Commerce take rate strong and consistent, 9.4% in the fourth quarter, 9.2%, up slightly for the full year. Clearly, the growth driver of marketplace is e-Commerce, though, I think that’s pretty clear. And then on Kaspi Travel, this is also now a more relatively at least more mature business within marketplace, 6% GMV growth in the fourth quarter, 14% GMV growth for the full year with some take rate expansion. But again, I mean, I think the point is pretty clear.

The main driver of the marketplace business is the core e-Commerce franchise and the value-added services around advertising delivery and financing for both the merchant and the consumer. So the combination of decent GMV growth, but strong take rate improvement results in materially faster revenue growth. 13% and 23% ex smartphones, up 21% for the fourth quarter and 30% revenue growth in the marketplace for full year 2025. Net income growth was down 7% in the fourth quarter but up 6% for the full year. Now part of the reason here for the decline in the fourth quarter is again the smartphone issue growth, net income growth would have been positive otherwise. But also a lot of the growth in marketplace that growth in purchases is being driven by lower ticket size, frequently purchased, but lower ticket size items where the cost of delivery is a higher part of the GMV from the first of January beginning of this year, we’ve raised the price of delivery to protect against that.

So again, that will sort of be an issue that is less obvious as we move into 2026 increase in the price of delivery offsets. The sort of the dilution from growth in small ticket items. So then finally, moving on to fintech in Kazakhstan. 4% growth TPV growth in the fourth quarter. Again, lower growth in the marketplace means a lot of growth in fintech, 13% growth for the full year. Growth driven by — across all products, but again, been the case now for several years, the merchant and micro business financing has really been the growth driver of the lending part of the business. [ Order ] fintech trends broadly stable over the year. So those trends being both sort of pricing. Yield flat at 24% over the year and cost of risk probably unchanged at 2.2%.

We’ve talked about it on previous calls, the increase in the NPL ratio. That’s just a function of as collections become more efficient as we get better collecting, the probability of collection improves. Those nonperforming loans stay on the balance sheet. So that’s the reason for the increase. Number one, number two, we’d expect it to stay broadly around that sort of 6% level for the remainder of this year. And the lower coverage, that just reflects, again, I’ve said this before, growing share of car loans. That’s a collateralized product. Requires less coverage and the growing share of the merchant financing, the fastest-growing lending product, which is a lower risk product. Again, we’d expect the coverage to stay around that level. Although it just varies, it [ all ] depending on the exact pace of growth between those — the mix of different products.

Loan portfolio growth was good, both in the fourth quarter and for the year, up 27% and 31% and growth in savings growth in deposits, up 16% and 18%. So actually pretty consistent throughout the year. So decent TF fee growth with stable pricing translates into a decent revenue growth up 19% in the fourth quarter, up 20% for the full year. The net income growth was 4% and 9%. So again, fintech is the marketplace was affected by the smartphone issue. Fintech has been impacted by material increase in interest rates over the course of the year, higher taxes and higher national bank reserve requirements. If you ex all those factors, which is — with the position we were in 12 months ago, when we started the year, our fintech growth was around 18% for the fourth quarter and also 18% for the full year 2025.

So that just gives you a sense of the impact these external factors have had on the performance of the business and particularly fintech over the course of the year. On Hepsiburada, when Mikheil already talked about it, I think we said on the last call, a simple metric for investors to track the improvement in the performance of the business is just look at purchases. And you can see that purchase momentum at the end of the year, up 19% was dramatically better than at any other point during the year and actually for some time. So here too, similar strategy to the marketplace in Kazakhstan, driving a number of orders, which is frequency of purchase, the things that we will buy on a day-to-day basis to increase the relevancy and engagement on the platform.

And that is clearly coming through and can improve further. That is partly at the expense of ticket size, frequently purchased items, cost less. So you have slightly lower GMV growth. So just to be clear, the 13% and the 7% growth in the fourth quarter and full year, respectively. That’s the real growth, the 49% and the 45% is the nominal growth in the business. From our perspective, what’s important, again, is that the momentum — where this business finished the year from a top line perspective? Is in a dramatically better position from where it started for the year. And of course, we’re still in the early days of the plan for Hepsiburada for [indiscernible] With take rate improvement and with also grass growth in delivery revenue that led to faster growth in revenue.

18% in the fourth quarter, 13% for the full year. So again, you see that the revenue momentum is starting to get up in real terms to much better levels at Hepsiburada, of course, the improvements that we’re making, there is an investment behind that. The aim here now is to sort of to keep the business at around EBITDA breakeven, reinvest into improving the products and services, driving engagement and driving the growth to create a much more bigger business and with scale with a highly engaged user base. It’s what will drive the profitability of the business. So we’ll keep that strategy of investing to build a much bigger, much more valuable asset in the medium term. But you can see that the results are starting to come through, and we’ve got a lot to continue working on.

That wraps up the review of the respective segments. So, I mean, here is just a summary for Kazakhstan, 15% revenue growth in the fourth quarter and 19% for the full year, 18% and 21%, underlying, net income growth 1% and 10%, in the fourth quarter and full year underlying 13% and actually 18% for the full year. So again, just a really clear indication of the impact that higher rates higher taxes and regulatory requirements and smartphones have had on the business in 2025 including Turkiye, you see that revenue increase to just a $4 trillion, which is just over $8 billion of revenue for the full year. And again, sort of similar, you see on the top line to — sorry, on the bottom line, the net income growth for the full year was flat year-on-year.

$1.1 trillion tenge, just around $2.1 billion, and we’re reinvesting we’ve reinvested the profit growth into Hepsiburada. And just that — sorry, I should say just on this slide, that net income growth there of 10% for full year ’25, that compares with the revised guidance for last year of 10% to 12% at the lower end, reflecting, again, the absence of recovery in smartphones in the fourth quarter. So looking forward to 2026, a couple of points to make here. So firstly, guidance as usual for GMV, TPV and TFV. However, guidance now includes Hepsiburada and Turkiye. So previously, last year’s guidance was Kazakhstan only. This year’s guidance is Kaspi.kz. It includes Kazakhstan and Turkiye. To give you the base to work off, these are the GMV TPV and the TFV numbers.

including Hepsiburada in 2025. Clearly, the bulk of heps businesses is a marketplace that goes into although there are components of payments and fintech as well. And if you want to work out those components, you can just compare these numbers with the respective segments for Kazakhstan that have just run through and you can split out what’s from Kazakhstan and what’s from Turkiye. The growth, again, we’ve been pretty clear the growth now going forward for ’26 and medium term will be driven by marketplace GMV. So this around 20% is both Kazakhstan Marketplace and Turkiye, our marketplace, TPV and TFV the same. And then the bottom line or the profitability level will guide on adjusted EBITDA. Here is the base to work off $1.6 trillion tenge for 2025.

And this just reflects now with Kazakhstan and Turkiye as a multi-country business, different interest rate environments and cycles, different tax levels, different regulatory changes this sort of axes out those things is a better reflection of the sort of underlying business and just aids comparability between the different countries. So we’re looking for around 5% EBITDA guidance. I mean here, just one point beyond the point about sort of reinvestment in Hepsi. From talking with investors, a lot of investors talk to me about the benefit from interest rates go it potentially moving down this year. And it’s logical, but you just need to keep in mind, it hasn’t happened yet. And we don’t assume in this guidance any sort of reduction in rates.

And I think that may be some of the sort of differences between where some sort of buy side our expectations and versus our own. So just let’s keep that in mind. It is reasonable to assume that rates can come down over the medium term and that we’d be — that would be a material benefit for us, but we’re not there today. Just on the marketplace guidance. So also what we will now do again, combining Kazakhstan and Turkiye. So we guide from marketplace as a whole. This gives you the 2025 reconciliation. We’ll split it is e-Commerce. These are the two comparable businesses between Kazakhstan and Turkiye. I mean, these relate to the metrics that Mikheil showed you, this is what we’re focused on trying to drive. These two components in 2025, were 54% of marketplace GMV.

We expect them to be around 60% of marketplace GMV this year. And then m-Commerce, travel and e-Commerce with the Kazakh specific parts of marketplace, we’ll have them sort of separately. So this will just give you a sense of how we’ll report from Q1 and going forward of Q1 ’26. Here is the reconciliation from net income to adjusted EBITDA. I won’t go through it line by line. If people have questions, we can just take this offline. So that’s on that side of things. But I think that generally wraps up our comments. So Harry, let’s open the call up to Q&A, please.

Q&A Session

Operator: [Operator Instructions] Our first question today will be from the line of Luke Holbrook with Morgan Stanley.

Luke Holbrook: I’m just going to send to mine on Hepsi and Turkiye. The first is that you’re obviously seeing more positive changes regarding the order trajectory, more same and next-day delivery. But in that context, with 2/3 of orders now say more next phase? Is this a year where we could potentially see peak losses? Or do you see more investment required here to improve the selection and the delivery offering? By extension on that, my second question is just more on [ Rabobank ] and the $300 million of investment. I’m just trying to work out, can you be clearer on what that investment looks like and the type of products that we could expect to see in timing should the acquisition complete? And then the final question, again, just entering more on Turkiye and the broadening of potentially e-Grocery offerings.

I’m just wondering where you stand, particularly in light of Uber’s more activity with [ Gati ] and trend go in the sector and whether you see it as a necessity at some stage for Hepsi’s proposition.

David Ferguson: All right, Luke. Thanks a lot for your question. So the role in Turkiye, maybe I’ll just pass them all on Mikheil, [ Peak ] losses, [ Rabobank ] and e-Commerce in Turkiye.

Mikheil Lomtadze: Yes. Sure. Thank you for your questions. In terms of our strategy and investments, again, our — we’ll manage the Turkiye business around EBITDA breakeven, which basically means that we’ll be investing into the consumer engagement and the consumer engagement increase comes from faster delivery again, all around the data and personalization so that consumers can find their products. We’re investing into technology and we’re scaling technology out of Kazakhstan as we speak. We’re making — we’re making investments in organizing data in a way that it’s 360 degrees around consumers around the merchants, which enables us to delivered better quality services. So all those are the investment areas. So when you think about what you call or think about the losses, we really think about that we are just investing into creating — it’s not necessarily — we’re not focused on the size, not bigger business, but definitely a more valuable business, which excites merchants and the customers.

So that would be our strategy for this year, and then we will see how it goes in the future. In terms of the — what we will be basically showing you the progress through the year, of course, and in terms of the investments into things like delivery and marketing, those investments are again targeting consumers growing the share of engaged consumers who shop with us frequently. In terms of the financial services or fintech. First of all, we already have the capability to provide fintech products through the microfinance company subsidiary, which is owned a fully owned subsidiary of Hepsiburada, and some of the products we plan to launch notwithstanding the full banking license. And when we talk about the banking license, that just gives us an opportunity to launch the wide range of the financial products, especially around the consumers and the merchants both on the savings side and the lending side.

$300 million, it’s an investment, which comes together with the capital and you have work just going through the regulatory approval. But as soon as those will be taking specific steps on the products, we’ll be updating you in due course. We don’t really like to speak about the future products, which we will launch. But the one thing which we can clearly say the investment of $300 million, which we are forecasting and also actually did say about it last year that is already taken into account when we’re thinking about resuming the dividends. And then the third question was…

Luke Holbrook: e-Grocery, what’s…

Mikheil Lomtadze: Yes. Well, this is actually pretty exciting. I think the fact that Uber is doubling down on the investment just tells you that Turkiye is an attractive destination and there are several companies like that entering the market is just a testament to its attractiveness. So that’s on the move. We’re not in a [ quick ] commerce business. So we’re not — that’s not the business which we have in Kazakhstan, either, at least at this stage. We are focused on the e-Grocery business, which is not about small ticket fast commerce items, but it’s about staffing your fridge with your household. And even though we deliver very fast in Kazakhstan, we’re not in the quick commerce business yet. And — but for the Turkiye itself, we will see at the moment, we’re really — the way we sort of operate the data guides us what our consumers want.

And based on what our consumers want, we develop those services. And when we talk about this year, our focus will continue to be on the same things which we worked on last year, and those would be growing engaged consumers, understanding what type of items our consumers want and then working with the merchants to enable this assortment. And at that stage, there is no — we don’t — at this stage, we don’t have intention to move into quick commerce.

Luke Holbrook: Understood. And just to clarify, there’s no specific ring fencing that this year will be peak investment in Turkiye from what you’ve just said there. It just depends on ROI and trajectory through the course of this year?

Mikheil Lomtadze: Well, I mean, the investments, which we’re saying if you’re saying, we will be — will our profitability in 2027 will be higher compared to 2026, the investments that we’re making are, again, if we see that investment gives us frequency and we see investment gives us the consumers which are coming back. we will continue investing into those consumers. If we believe that making improvements into delivery and increasing speed is something which retains those consumers, and they come back to us, we will continue those investments. So that’s the way we have done in Kazakhstan, and that’s the way we plan to do in Turkiye, and we tested all those elements during 2025. And we do see how consumers are responding. Merchants are responding and we’re very excited about it.

We’ve launched the weekend deliveries, which didn’t exist before, and that’s speeding up delivery again. And of course, temporarily, you’re running operation, which can potentially process more orders. But you’re starting for the specific segments of the consumers on the lower volumes, and that means that your running network, not at full utilization. When you look at Kaspi, Kaspi has — what is it like almost 7x, 6, 7x more order frequency per consumer during the year. So that just gives you a huge scale on the network of the delivery and the logistics, which gives you a very strong return. And at this stage, when we think about the Turkiye, we are building up that capability. So utilization rates won’t be as high as Kaspi during this year because we still have a long way to go to increasing frequency of the purchases.

Whether investment will be in 2027, less than 2026. I’m not going to give you such a forecast or guidance. But the one thing I can tell you that what we’re investing into, we believe, will bring the growth and the engagement of the consumers in the future. Kaspi was — when we started Kaspi now is a $2 billion net income business. And at some point, it was minus $60 million. So there are no vehicles, but we know the playbook is there and we know how our consumers and merchants react, and we’re very excited about this opportunity to build up the very loyal engaged consumer base, which is happy with our services.

Operator: The next question today will be from the line of Gabor Kemeny with Bernstein Society General Group.

Gabor Kemeny: This is Gabor here from Autonomous. To continue on Turkiye, can you comment a bit further on the competitive environment? I mean, you obviously have one large competitor, there are a number of smaller ones. I wondered how you perceive their behavior as you have been accelerating your volumes at Hepsi. So that’s the first one. Second one is we have an EBITDA guide. Would you be able to give us a flavor of how you expect the bottom line to develop with all those moving parts around regulatory changes, taxation reserves, et cetera, that will be helpful to understand the dividend capacity of the business. And to follow up on that, can you give us a flavor of the sustainable dividend payout going forward?

David Ferguson: Yes. Well, maybe I’ll take the second and then pass it to Mikheil to talk on Turkiye. Well, I think — so we’ve declared 850 Kazakh tenge per share for the final quarter of last year. And we’ve said that we believe that, that is sustainable for the remainder of this year. So you can extrapolate that to work out the total dividend for this year, the potential total dividend for this year. So that’s the first thing I’d say. The — you asked about payout ratio as well that 850 tenge per share is exactly the same as we paid in the final quarter. just prior to Hepsiburada acquisition. So I think you can think about, again, you can see what kind of payout ratio that was in 2024. And you probably — you look at a similar number for 2026.

Clearly, we’ve gone within an amount we believe will be sustainable going forward. We’re not looking to cut the dividend the next quarter. So that’s the main point to make that — should give people a decent level of predictability. On the other, we’re not going to give you guidance — we’re giving guidance on EBITDA, so we’re not going to give guidance on net income. I think just the things though to keep in mind at the net income level are. So as of today, no reduction in interest rates, number one. Number two, higher taxes in Kazakhstan in 2026. So this isn’t just something that was a 2025 event. The bank tax only went off from the first of January this year. So this is something that people need to be aware of. So that will add around 200 bps to the tax rate.

So that’s something to build in. And then there’s also the higher national bank reserve requirements, which will have an impact on the bottom line as well. So clearly, there’s a number of different factors that will weigh on the bottom line this year, those factors should be in the base by the end of — of end of this year and you get the upside and return to growth next year, but we still need to work through them. And hopefully, as we work through them, we start to move in the second half of the year into interest rates moving down, which again would be a positive for next year. But as I said, we’re not there yet. That’s fully as much as I can say.

Mikheil Lomtadze: And as a question about the question about the competitive dynamics. I mean, we are very respectfully observing the competitive dynamics, of course, and that’s not different from Kazakhstan or Turkiye. But at the same time, again, our priority is really just to focus on the very high quality of the products and services, which is the final product the company needs to produce for consumers to come back and for the merchants to do business with you. And that’s basically where our focus is. So our focus is on the operations on increasing the engaged customers, which eventually will increase the frequency of the orders. And that’s basically what we’re focused on. I don’t know if maybe — if you have any specific questions other than that, we’re not waking up in the morning thinking about competition, and we’re not going to slip in the evening to thinking about competition.

we’re thinking about consumers and we’re thinking about merchants, and that’s our priority. This is the way we went on business in Kazakhstan, and this is the way we do business in Turkiye.

Operator: [Operator Instructions] The next question will be from the line of James Friedman with SIG.

James Friedman: I wanted to ask first, David, a modeling-related question. In terms of Slide 19, is this fully pro forma — I’m looking at Slide 19 in the press release. So it’s the one where it says the guidance slide — the guidance now includes Turkiye. I’m just trying to understand, is this fully — is the ’25 number fully pro forma so we get the — yes, that one. So we get the underlying period of comparison.

David Ferguson: Yes. The — so that — so 2025 numbers, they include Hepsiburada, the only thing — so that number one, they include Hepsiburada, Number two, it’s relevant for all segments, but particularly GMV. Number three, the only thing you need to keep in mind, I would say, is that — and this is more when you’re just forecasting forward. Remember, we only acquired Hepsiburada, at the end, we closed the deal at the end of January of last year. So it’s approximately 12 months of Kaspi and 11 months of Hepsiburada, They are the things to keep in mind there. But other than that, yes, I mean this is the pro forma base to work from.

James Friedman: Got it. And then, Mikheil, in your prepared remarks, you were — you were mentioning that you some of the effect if you would prefer — you’re focused on the frequency of use as opposed to the total number of users. So like RPAC, as opposed to accounts up file. Can you elaborate on that as you migrate to Turkiye with Hepsiburada?

Mikheil Lomtadze: Well, I mean, basically our First of all, just also to make it will be — 2026 will be also almost a full year where we can now make them comparable. So that will make, I think, everybody’s life easier, right? So we can actually pretty much compare consolidated business 2026 to 2025. So that’s — that would be a good news for everyone. Number two is, because we acquired Hepsiburada in January of last year. Number two, in terms of the way we sort of manage again, what we’re saying is that the new — the customer’s growth was 15% in the last quarter, which is a great headline. However, again, what is our focus. Our focus is engaged consumers because those are the ones which make business work, and those are the ones which repeatedly come back and interact with you and buy from you.

So the things which you are right in the sense that those are the consumers which are keep basically buying with you. Therefore, you have less marketing costs, you have less operating cost to serve them, and that’s what is giving you the very favorable economics on the consumer level going forward. And we know that worked in Kazakhstan, and it will work exactly the same way in Turkiye. The one thing which we should also keep in mind that we are also a true believer in building up different services around the consumer needs and not just, let’s say, e-Commerce, for example. So things which are related to the fintech and others will be something which we’ll be also working on during 2026 and onwards. And when you think about the scale of the business and how much network effects and synergies that can have, you can extrapolate the way that Kaspi has been really doing.

The comparison we gave you, it was only on the e-Commerce side. The comparison, if you think about the breadth of the services around the consumers and merchants and if you go beyond e-Commerce, I mean, it’s massive. I’m not saying that this will be automatically happening. Of course, it will take a lot of work from us, but the opportunity on a total level around household needs of the consumer and the business needs of the merchants, it’s just massive. And we just gave you something to compare between e-Commerce, pure e-Commerce comparable piece because that’s where our focus is. Because we believe that if consumers are buying with you frequently and the merchants are selling with you frequently, though this is the combination from which you can build because that is the point when the merchant is making a decision to sell and the consumer is making decision to buy.

And all the other services are built around that. It’s much more difficult to make a fintech financial services into marketplace and it’s much easier to make marketplace into fintech financial services.

Operator: And this will conclude our Q&A today. So I’d like to hand back to David and Mikheil for any closing remarks.

David Ferguson: Well, does have — Jamie said he was going to drop back into the queue. But if James has another question, we can take it if you’ve got any follow-up, James.

Operator: I apologize, we do have a follow-up question from the line of Gabor Kemeny.

Gabor Kemeny: Just on fintech, the TFV growth which you expect to slow down to 5%. Can you give us some context there? Because I understand that you are not planning to change your — I mean, the year, the growth yield is expected to stay stable around 6%. So presumably pricing stable. So what is expected to drive the slowdown in lending/?

David Ferguson: I would just say one thing to think about is TFV growth is linked to GMV growth in Kazakhstan. And if you think about where the GMV growth is coming from, it’s generally coming from lower ticket items, less so the extreme example of that is grocery, which is just less credit sensitive. So people are still using the same amount of credit to buy the consumer electronics items, but that now is a mature, slower growing category within marketplace. So it just reflects the change in — at least one key reason is it just reflects the changing shift in the marketplace business. Actually, that’s a long run trend.

Operator: And we have a follow-up from the line of James Friedman also.

James Friedman: Yes. Thank you. In terms of what you were calling out earlier, David, about the e-Commerce versus m-Commerce relative growth rates. Can you talk about how that impacts the consolidated take rate overall? Yes. I think it’s the one or…

David Ferguson: Okay. So it’s take rate positive. So because if we look — sorry, just flicking the slides, e-Commerce, well, let’s do the end of the year. E-Commerce take rate finished last year at 12.7%, so just short of 13%. So e-Commerce is faster growing and its higher take rate versus m-Commerce which is just around sort of under 10% take rate. So that’s one thing. And why — because e-Commerce, well, lends itself to delivery. So that’s a clear value-added service that’s not relevant for m-Commerce and commerce going to the physical location. And at least to date, the advertising products are all around e-Commerce. So again, the value-added services are all linked to e-Commerce. It’s not to say you can’t have value-added services for m-Commerce as well.

And actually, m-Commerce take rate has consistently increased. But if you think about the two big ones that we’ve talked about, delivery earned advertising, they are really relevant to e-Commerce. So it’s actually a positive dynamic from a take rate and revenue perspective.

Mikheil Lomtadze: I would like to make one quick comment on this. So even though it’s a it’s a positive dynamic from the take rate and revenue perspective, e-Commerce is more operations heavy than m-Comm, right? So let’s say, delivery. And we are investing into delivering. We’re monetizing the delivery of the merchant side, but the buildup of delivery, especially on the lower ticket item side, we’re still investing. So when you think about the take rate, take rate is [ tie ] potential is much higher the services we develop around consumer and the merchants have a huge potential and deliver a lot of value for both. But profitability of e-Commerce on is less than comes m-Commerce because of the operational side of working with — on the delivery — on the long term, of course, that will be something different, but immediate in fact, when you move m-Commerce, like if you move the merchants GMV from m-Commerce, which is in-store experience to e-Commerce, and you add on top of it, the operational costs related to the delivery investments, the take rate and the delivery take rate decrease revenue, but the delivery is decreasing the profitability.

So the margin of the e-Commerce at that immediate migration will be less. But the take rate and the future potential is much bigger.

Operator: And we have a follow-up from the line of Luke Holbrook with Morgan Stanley.

Luke Holbrook: I just wondered if we could just touch on Agentic AI or Agentic Commerce here being the elephant in the room for e-Commerce companies as well around the world. Just your views on where we stand today regarding any partnerships you have. Large language models with ChatGPT and as considerations from your perspective, that would be interesting to hear.

Mikheil Lomtadze: Yes, thank you for the call. I mean, I think what we would like to — yes, that’s a separate subject, maybe even the different call, I would say. I mean, in general, we are working on the assistance to help our merchants to be — to do business more efficiently and help our consumers to make purchases as well seamlessly navigating the help of the virtual assistance. So that’s basically we’re already applying a lot of it internally. And yes, I think it deserves a separate call and a separate discussion maybe with you, too. But we’re developing this in-house. And I think I’ve mentioned this to the discussion we had recently.

Operator: And that will conclude Q&A. I’d like to leave the floor to the Kaspi team for any closing remarks.

David Ferguson: All right. So thanks, Harry, for the call. Thank you all for joining. Please get in touch with any questions. We are in the U.S. this week. Keep in touch. Happy to take questions off-line. Thanks, everyone, for your time, and speak to you soon. Thanks a lot. Bye-bye.

Operator: This concludes today’s webinar. Thank you all for joining. You may now disconnect from the call.