Joint Stock Company Kaspi.kz (KSPI) Q3 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The company shows strong growth in key areas like e-Grocery, advertising, and fintech, despite smartphone supply issues. The strategic expansion in Kazakhstan and Turkey, along with plans to resume shareholder returns, are positive indicators. While management avoided specifics on dividends and smartphone supply normalization, the overall sentiment is optimistic, especially with strong performance in non-smartphone segments and advertising growth.
Key Financial Performance
Payments TPV 18% growth year-over-year. This growth reflects the ongoing popularity of Kaspi Pay, bill payments, and the fast adoption of B2B payments.
Payments Revenue 10% growth year-over-year. The growth is slower than TPV due to take rate dilution caused by a shift towards QR payments.
Payments Net Income 12% growth year-over-year. This is due to operational gearing and cost control.
Marketplace GMV 12% growth year-over-year. Excluding smartphones, GMV growth is 20%. The slower growth is due to smartphone supply disruptions.
Marketplace Revenue 24% growth year-over-year. Excluding smartphones, revenue growth is 32%. The growth is driven by value-added services like Kaspi advertising and delivery.
Marketplace Net Income 7% growth year-over-year. Excluding smartphones, net income growth is 16%. The slower growth is due to the mix effect of 1P e-Grocery growing fast and taking share within the mix.
Fintech TFV 16% growth year-over-year. This growth is driven by merchant lending, which is growing faster than consumer lending products.
Fintech Revenue 24% growth year-over-year. The growth is driven by strong origination in previous periods and stable pricing.
Fintech Net Income 15% growth year-over-year. Adjusted for external factors like base rate increases, net income growth would have been 28%.
e-Grocery GMV 53% growth year-over-year. This growth is driven by scaling operations, increasing customer base, and adding new dark stores.
Advertising Revenue 56% growth year-over-year. This growth is driven by the launch of new advertising services that enable merchants to increase sales and improve consumer decision-making.
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Operating Highlights
Kaspi Pay-by-palm: A new payment innovation allowing users to pay by scanning their palm. It will be rolled out at the end of the year and will be free for merchants for the first 3 months.
Kaspi AI Assistant: An AI tool for merchants to enrich product content, create descriptions, and generate photos, leading to increased sales and consumer engagement. It will be available in January 2026.
Advertising Service: Merchants can now advertise on third-party platforms like Facebook, Instagram, TikTok, and Google directly through Kaspi's platform.
e-Grocery Expansion: Kaspi's e-Grocery business grew GMV by 53% and transactions by 55%. Plans to expand to at least 2 more cities next year.
Restaurant Vertical: Kaspi introduced QR code payments and tipping in restaurants, with TPV growing 259x and over 1 million transactions in Q3.
Glovo Integration: Kaspi integrated Glovo's services into its Super App, allowing seamless access and payments for restaurant deliveries.
Smartphone Supply Disruption: Shortage of smartphones, particularly iPhones, impacted GMV by 8% and consolidated income by 3%. Recovery expected next year.
High Interest Rates: Kazakhstan's base rate increased from 15.25% to 16.5%, impacting net income by 4%. Rates are expected to normalize next year.
Tax on Government Securities: A new 10% tax on revenue from government securities reduced net income by 1%.
ADS Buyback Program: Kaspi announced a $100 million ADS buyback program starting in November, reflecting strong cash generation and performance.
Hepsiburada Investments: Focused on delivery, BNPL options, marketing, and user experience to drive growth, with GMV up 15% in Q3.
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Risk or Challenges
Smartphone Supply Disruption: Shortage of supply of smartphones, particularly iPhones, impacted GMV growth by 8% and consolidated income by 3%. This disruption is a countrywide issue and affects both e-commerce and m-commerce.
Smartphone Registration Requirement: New registration requirements for smartphones contributed to the supply disruption, further impacting the company's performance.
Tax on Government Securities Revenue: Kazakhstan introduced a 10% tax on revenue from government securities, reducing net income by 1%.
Increased Minimum Reserve Requirements: Higher reserve requirements with the National Bank, which do not accrue interest, negatively impacted net income by 1%.
Base Rate Increase: The base rate in Kazakhstan increased from 15.25% to 16.5%, reducing consolidated net income by 4%. High interest rates continue to pose challenges.
High Interest Rate Environment: The high interest rate environment in Kazakhstan has a material impact on the company's financial performance, particularly on the fintech platform.
Economic and Regulatory Challenges in Turkey: Hepsiburada, the company's Turkish subsidiary, faces economic and regulatory challenges, necessitating a $100 million share capital increase to ensure adequate capitalization.
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Guidance & Outlook
Smartphone Supply Recovery: The company expects the smartphone supply disruption to resolve itself over the course of next year, with a favorable base effect starting from March 2026.
e-Grocery Expansion: Plans to enter at least 2 new cities next year, with continued scaling of dark stores and a focus on profitability and engagement.
Kaspi Pay-by-Palm: The company plans to roll out the Pay-by-Palm payment innovation by the end of 2025, offering it free of charge to merchants for the first 3 months.
Kaspi AI Assistant for Merchants: The AI Assistant for merchants will be launched in January 2026, aimed at enriching product content to drive sales and consumer engagement.
Hepsiburada Investments: Investments in delivery, payment options, marketing, and user experience are expected to drive sustainable revenue growth in future years.
Interest Rate Environment: High interest rates in Kazakhstan are expected to normalize, providing additional performance positives for the next year.
Marketplace GMV Growth: Excluding smartphones, marketplace GMV growth is expected to be 19%-21% for 2025, with recovery anticipated in 2026.
ADS Buyback Program: A $100 million ADS buyback program will be launched, with potential for further buybacks and resumption of dividend payments in 2026.
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Shareholder Return Plan
Dividend Payments: The company has announced plans to resume dividend payments in 2026. However, specific details regarding the dividend amounts or schedule have not been disclosed yet.
Share Buyback Program: Kaspi.kz has announced a $100 million ADS buyback program starting in November 2025. This decision is based on the company's strong cash generation and performance, and management views it as a good investment given the current stock valuation.
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Key Q&A
Q:Can you provide updates on Hepsi in Turkey, particularly regarding investment levels needed to reverse operating losses and insights on the competitive environment?
A:The priority is to enhance product and service quality for both consumers and merchants, focusing on mobile applications and delivery infrastructure. Investments are aimed at improving delivery speed, consumer engagement, and merchant satisfaction. There is no significant need for capital investments unless justified by service quality improvements. The competitive environment is acknowledged but not a primary focus; the emphasis remains on service quality.
Q:How is the advertising product in Kazakhstan performing, and what is its growth potential compared to global peers?
A:The advertising product is growing strongly, with services like product listings, brand advertising, and merchant rewards. The focus is on enhancing merchant experience and targeting engaged consumers. Advertising is expected to grow faster than other revenue streams, supported by data-driven and user-friendly technologies.
Q:What are the drivers behind the 80 basis points increase in marketplace take rate, and how does the advertising campaign work for merchants on the Super App?
A:The take rate increase is driven by additional services like advertising and delivery revenues, not by raising seller fees. Advertising campaigns are simple for merchants to set up via the app, requiring minimal input while leveraging data-driven technologies to target consumers effectively.
Q:What is the current impact of smartphone supply issues on GMV, and how sustainable is non-smartphone marketplace growth?
A:Smartphone supply issues, particularly with high-end models like iPhones, have significantly impacted GMV. However, non-smartphone marketplace growth remains strong, with a 36% increase in transactions and 86% growth in e-commerce transactions. The supply disruption is expected to normalize in the coming months.
Q:What is the outlook for marketplace GMV growth in Q4, and how does the smartphone issue affect it?
A:Marketplace GMV growth is expected to moderate in Q4 due to seasonality and smartphone supply issues, particularly with high-end models like iPhones. The smartphone issue affects GMV significantly due to the high ticket size of these items.
Q:Are grocery and delivery businesses self-sustainingly profitable, or are they engagement tools?
A:The grocery business is self-sustaining and profitable. Investments are being made in dark stores to meet demand, with plans to expand into new cities. Demand exceeds current capacity, driving infrastructure development.
Q:What is the plan for reinstating dividends next year, and how will it balance with international expansion?
A:The company plans to reinstate dividends next year while balancing the need for international expansion. Cash returns will be managed through dividends and buybacks, with specifics on payout ratios to be decided later.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details on the dividend payout ratio for next year, stating that it would depend on balancing growth investments and cash returns. Additionally, they did not provide a clear timeline for when smartphone supply issues would normalize, only indicating it would likely improve in the coming months.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI Assistant
AI photo
Alaqan
BNPL
Glovo
QR code
application
assistant
bank
campaign
characteristic
click
consumer QR
consumer decision
content
control group
description
effect smartphones
factor
group product
homepage
improvement
influencer
influencers
interest consumer
interior
item
kettle
minute
order
palm
party platform
payment option
photo AI
restaurant
screen
selection
technology
test
user
KSPI Transcript
Joint Stock Company Kaspi.kz (KSPI) Q1 2026 Earnings Call Transcript
Positive5-11
The earnings call indicates a positive outlook with strategic initiatives like Pay-by-Palm expansion and e-commerce growth. The dividend proposal and optimism about Kazakhstan's macro environment add to this sentiment. Despite some uncertainties, such as unclear synergies with Tencent and a decline in payment take rates, the focus on long-term engagement and strategic investments in Turkiye suggest a positive trajectory. The guidance stability, despite Q1 results, reflects confidence in future performance. Therefore, the stock is likely to see a positive movement over the next two weeks.
Joint Stock Company Kaspi.kz (KSPI) Q4 2025 Earnings Call Transcript
Unknown3-2
The earnings call shows mixed signals. While there are positive aspects like revenue growth and plans for expansion, concerns remain about high interest rates, taxes, and a lack of specific guidance on investments and new product launches. The Q&A reveals uncertainties, particularly around Hepsiburada's investments and the $300 million Rabobank initiative. The neutral sentiment reflects balanced positive long-term strategies and immediate concerns, with no strong catalyst for a significant stock price movement in the short term.
Joint Stock Company Kaspi.kz (KSPI) Q3 2025 Earnings Call Transcript
Positive11-10
The company shows strong growth in key areas like e-Grocery, advertising, and fintech, despite smartphone supply issues. The strategic expansion in Kazakhstan and Turkey, along with plans to resume shareholder returns, are positive indicators. While management avoided specifics on dividends and smartphone supply normalization, the overall sentiment is optimistic, especially with strong performance in non-smartphone segments and advertising growth.
Joint Stock Company Kaspi.kz (KSPI) Q2 2025 Earnings Call Transcript
Unknown8-4
The earnings call presents a mixed picture: strong deposit growth and positive GMV and EBITDA growth, but challenges from high interest rates and a reduced GMV growth outlook. The Q&A reveals underpenetrated opportunities in Kazakhstan, but concerns about funding costs and unclear guidance on smartphone market recovery and capital deployment. These factors balance out to a neutral sentiment.
KSPI Report
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