Q1 2020 Earnings Call

[music].

Last question at this stage. Please press Star then one telephone keypad.

Must also thought do the cool it's been recorded today Tuesday, the 28 the people twentytwenty.

I would now like to hand, the conference over to the head of Investor Relations today, Yulia Jed I said they've done. Please go ahead.

Hello, everyone and welcome to Yandex first quarter Twentytwenty.

When you Didnt owning sweet earlier today, you can find these capiq when I asked about pipe as well as a newswire services on the coating. We have gone live again, Deputy Chief Executive Officer, and usually come out Chief Executive officer of Yandex taxi and Greg Abovsky, Archie, but the weighting in Chief Financial Officer.

I didn't bullish of founder and Chief Executive Officer, They get more chose our VP of corporate development and you give me Sandra Chief Financial Officer stand exactly will be available on the kidney function.

The goal will be recorded in the recording will be available on the I, but I didn't you hours and he we shall we prepared to keep that when entries plants, which are currently available on the that's right now I will quickly walk you through the Safe Harbor statement. The last few months doesn't mean during this cold about our future expectations plans and prospects constitute forward looking statement.

Actual results may differ materially some don't indicated or suggested by these forward looking statements. As a result, the provides important factors, including the impact of the ongoing called 19 pandemic as one of those just happened at least Dr. section of our annual report on form 20-F D equal seconds, Twentytwenty, which is on file with the FCC.

The available online.

In addition, any forward looking statements represent our views only as of today and should not be relied upon as representing all use as of any subsequent to the.

Although we may elect to get these forward looking statements at some point in the future, we specifically disclaim any obligation to do so even though he's change.

Therefore, you should not rely on these forward looking statements as roughly thinking I'll use the indeed subsequent to the date.

During the call, we'll be referring to certain non-GAAP financial measures. This non-GAAP financial measures I'm not prepared in accordance with he had GAAP a reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is provided in the earnings release issued today and now I'm turning the call over to take on.

Thank you you know a thank you for joining our call today, the first quarter structured well for US all of our business has demonstrated solid performance up on to meet March when we started to see an adverse impact from quote we don't break.

Since then our top priority hasn't been the wellbeing of what was tough our partners and double users. While some of our business is such an advertising can ride hailing something significantly by the trick to a social discussing measures you could use by the authorities the demand for Flotek ecommerce education for media services.

Materially increased let me turn to a brief overview Q1 trial before we discuss what were Colby related initiatives.

Search and portal segment was growing well ahead of our internal expectations in January and February.

Fortunately, we enjoyed where were strong stores should show games bolt on mobile and desktop in March we reached a record 55.9% shirt on Android growing 130 basis points from December and 430 Bips from March 2019.

Our oral show continued to grow strongly approach 60%.

Search square with girls has materially accelerated after 240, 45% year on year from single digit.

And over the February importantly, the key driver for these was a girl where young codells up to 24 years old each in search traffic inquiries, but 28% compared to February why the show schoolchildren increased by 56%.

Patrick looks cool audio is itself almost doubled before the same period.

In Q1, our mobile search traffic was 59% of our total sort of traffic.

Mobile revenues represented 50.4% Buffalo search revenues equal the first quarter with mobile service revenues exceeding that don't desktop.

Turning to them, we'll continue to see strong views that will go with 14.6 million daily active users in the March Wilan Apple them daily active users increased four though to over 16 million users in terms of gave him a total times pen grew 56% Youre Your March while an airport.

Girlfriends accelerated to almost 90%.

Immediate services. The total number of subscribers with 4.3 million in March and continued to grow for the Apple the number of losses viewing subscribers. All that can avoid you platform has exceeded 1.5.

Now, let me walk you through our key action point.

He wants to the Colby outbreak.

Firstly younger carries an important source of accurate and reliable information for our users, including coal Revlon data on coal among numerous public information you should be as we have introduced the so utilization real time index available on young mix main page. This index shows the degree of social distance.

<unk> different citizen by comparing can only Mike Baker Urban Pvt gave a normalized date before the pandemic.

The index is currently available in 507 to sit as in Russia, as well as eight other countries.

Secondly, our platforms, such a yandex taxi Galaxy Isa, Oregon, Latka provide earnings for hundreds of thousands of drivers and couple of years. For example, we have invested significantly in expanding delivery service as well as our food delivery platforms.

Distance learning, we launched the Ondeck school as a platform combining all of our new and existing international projects, including a full scale online school for five to let on great.

15 different subjects in accurate textbook daily active users increased eight times compared to March and exceeded 1 million users.

Last but not the least our social and you just is helping cap.

Have committed around 1.5 billion rubles across the various initiatives, including support fun for taxi drivers and Quakers advertising credits too small and medium businesses and our educational efforts.

The full reasonable measures and you should just is much longer.

We're all teams are working really hard introducing new features and services frankly, I think we have never seen initiatives and improvements being implemented at such a rapid pace looking beyond the pandemic or key priorities to ensure sustainable long term goal and they'd belief that we will emerge from this crisis stronger than.

Error, the car and downturn, coupled with the changing consumer behaviour provides us with a number of attractive long term opportunities across many though tickles never quarter Tizing business. They expect to benefit from accelerating shifts from traditional advertising to online higher consumption of streaming video immediate services and.

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It's corporate <unk> operating models to include more remote works to know if we will benefit from <unk> of cloud services.

There are also lot of attractive opportunities invited Lincoln food Tech and it with these I'm turning the Mike over to the meal.

Think it's around and Hello, everyone for some of the year index services, so that performance across our metric.

<unk>, 40%, yeah or yeah. You you one was January and February growing ahead of our internal projections.

Set the scene a slow down in the second helpless March due to the spread of course, we'd 19.

While in early March we are doing this last meeting price per day towards the end of March This number decreases <unk> and then diversity attracted coupon grossly.

The official over the down in Moscow status much 30.

So we'll see a much greater impact on our business in cute too.

It must go right hand, and what the heck that severely in Moscow G.M.V. has declined approximately 60% you're on here every day and around 70% <unk> early much.

Oh took over I.P.N.J.V. declined lesson in Moscow.

Asian, typically a few weeks behind Moscow in terms of coherent 19 impact.

<unk> in wrestling to contact driver sneakers.

Providers hundreds of thousands of my excuse of class and the Tigers and replace the pipe cognitive section.

Finishing 500 million <unk>, the so called R.S.I. tunes, okay, I've been affected or content.

The team is working five to <unk>, you know anything about you and just for drivers, including the news.

We provide transportation services to doctors believe covey tests, and you said two clinics and senior citizens.

Reversed and number of partnerships with Russia tell companies, including there on the land, yes can you tell it to <unk> in order to help them make believers to the user sometime in mental.

<unk> significant growth in the man.

The input of numerous times, Oh, plus from significant to increase and we simplified the unborn across the spongy restaurants.

As of today over 20000, <unk> I connected to our classroom.

To support local restaurants loosely connected to our plus home <unk> eliminated conditions for that.

Referred to deliver it has become an essential part of People's lives. There and you have benefited <unk>, how hyper local cut the third dingy remodel luck.

As of today, except over 100 doctors from must contend pitiful from each hour, whereas the new over 10 10 to 15 minutes despite significant growth in the man.

Listened to expand as a service coverage by connected Texas driver Laska.

No. It's available approximately two so it's always in Moscow population and over half of the people tempted to smoke.

So far the number of users of our <unk>, 73% compared to very much and this is 130% increase your on you.

There isn't to launch <unk>. That's contributor does is gross.

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Oh, no we see multiple opportunities dongs wrote the credit is clearly the must say that we have one almost unique companies in the world is unrivalled combination of logistics <unk> or <unk> curious to instantly become in Central Park with People's lives.

This terminals in my over to Greg will will do so if financially.

Thank you to Neil and thank you all for during our first quarter earnings call today, you've seen the presley's with all our keep national numbers, so only repeating them and stuff when you focus on the performance and current trends across our business.

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<unk> result, despite tough cops and they're coming 19 impact starting from in March.

X. tax increase to 14% well adjusted even done margin came to 48.7%.

30 basis points you every year.

Given the strictly enforced lockdown policies across the country and its impact on business activity or X. text search and portal revenue decline in April isn't the high teams territory on a month today basis. This was driven by a combination of factors such as decreasing at budgets pressure on C.P.C. dynamics and lower share of commercial search queries.

Importantly, our search queries April a growing at the fastest taste in five years and clicks growth is accelerating the <unk> search revenue in the last several days has recovered to hide single digit decline.

For wise I can't Telecom, who do grocery delivery healthcare and home garden have performed relatively better well travel apparel real estate, an auto or under more pressure.

That said I want to distrust a few things first of all decline is clearly driven by external factors, which are largely outside of our control.

For coded are <unk> revenue growth and an x. tax basis within the high teens territory. Secondly, our main goal now it's to grow market share and user base. So that when the economy rebounds, we can convert into revenue growth and our progress here is impressive, especially for the younger audience.

Overall, the revenue dynamic for the four year will depend the duration and severity of locked down measures and the economic impact as well as the speed of the recovery all of which are hard to predict at this stage.

Couple of words about the costs structure or search and portal business the fixed costs accounted for around half until a cash costs and a search and pull segment or personnel is the largest component that they're a little part includes tack and costs of sales.

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Tashi revenues increased by 50% year on year, primarily driven by 40% growth in a number of fries continued optimization of incentives and the right healing business as well as the rapid developing from Tech services.

We've managed to expand our adjusted EBITDA marching, excluding selling driving cars to 7.6% on the back of improving profitability right hailing offset by her investments in Moscow and the overall weakness that we saw in late March and write hailing variable costs represent approximately two thirds of our total costs, including incentives while the remaining part.

It is fixed and because since of personnel costs rent certain advertising and marketing as well as other operational expenses, we see opportunities to optimize costs, including advertising and marketing supply acquisition costs and certain overheads.

<unk>, we saw a further improvement in the unit economics, primarily as a result of increased density of orders. We've continued investing in laska, while being mindful of the impact of this business untold taxi either though.

Turning to other businesses.

Media services demonstrated very strong revenue growth of 95% you're on here with improved adjusted EBITDA margin both in a year, one year and quarter of a quarter basis, and Q1 subscription based revenues of media services, 252% you're on here and we see strong trends continue in April.

We continue investing in the business as planned and are focusing from the retention of new users.

Are classifies revenue increase 35% and Q1.

Growth in the first two months was very strong. However, we saw material slow down and late March after all auto dealerships, what order to close which obviously has a very meaningful impact on this business unit.

Well depression classifies rather than continuing April the traffic in our platform remain solid where she'd information of differ demand, which we plan to monetize as soon as the business activity starts to rebound.

Finally onto other best experiments.

<unk> almost doubled year over year term by the growth of young X. drive jail and then.

I'm, just drive cloud and Jim well so the key drivers are adjusted even the loss of 1.9 billion rubles.

I see grown mentioned Zen continues to perform strongly naval while our car sharing business has to get ahead, especially after car sharing services were suspended in Moscow in Saint Petersburg on April 13th.

<unk>, we're not focusing and optimizing our lease agreements and the size of the fleet in order to reduce the burden rate.

Guidance.

Even a difficulty in predicting how long the pandemic will persist uncertainty about its effects and the economy in our businesses were unable at this time to reliably quantify impact because it covered 19 outbreak on our future financial results as such withdrawing are 2020 gardens, which we provided on February 14th 2020.

Now.

What are we doing to mitigate the cover 19 impact on our performance.

We develop various trust us that helped us to define priorities and he's priorities include investments in the businesses with increased activity and higher social important in the current environment as wants strategic project to strengthen the company's position in the long term.

After onboarding around 1300 noon please in 2019.

Another 233 people into 120 20, we have decided to slow down at the piece of hiring given the current circumstances, partially because of the difficulties of integrating and train you people well, we all work remotely, but we also want to ensure that were appropriately sized when coming into 2021.

That being said, we may continue, adding headcount and certain limited strategic areas and look for opportunities to redeploy or personal resources to support and demand functions and our strategic priorities.

We've also made a decision to fourth in cash bonuses for top management in 2020 on top of that top management has accepted a voluntary pickup.

We're cutting non essential marketing expenses and exercising rigorous control of our overheads.

We believe these initiatives will help us to reduce the adverse impact of the pandemic and the macro headwinds on our 2020, you've it though.

In conclusion I wanted to remind you their balance you strong currently have 2.5 billion cash, including 390 million on the taxi balance sheet.

More than two thirds of this cash as in U.S. dollars all of our debt as long term. It matures and 2025, we're confident that are strong liquidity position will help us to a standard challenges. The current situation, while also providing us with flexibility to continue investing in the long term strategic projects with this chain and like to the operator for the <unk> session.

Thank you very much ones.

Christian today.

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Give me one just to.

Follow up.

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Once again.

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The fish question, we has <unk> comes from the line of sees.

From Bank of America.

Yeah, Hi, everyone. Thanks for the call and thanks for the <unk> to to ask questions. So I have to I'll I'll just have the first one just wanted to Ah tricky to could explain he significant increases in a in market share over the past couple of weeks. So she can be the last.

Report that blended marketer is about 59% what is the what is the key driver and do you see marketer <unk>.

Even result, the the help of a of regulation. Thank you so much.

Hi, Caesar Undergrad can you hear me.

Yep.

Perfect. So I think the main drivers or the growth of market share is just that we have become you know the de facto standard for getting a lot of knowledge and information about that corona biased as well as providing a lot of various.

Options for entertainment and things like that we've launched the number of initiatives.

They give people a lot more information about it and I think relative to you know relative to our competition.

The breadth of information as much richer and much more tailored to the local content context things that we launched around education on such are also important in terms of driving a younger audience as we talked about in the prepared remarks, so the younger audience, which historically has kind of probably.

Skewed away from us toward the competition has shifted their usage onto the Ondecks, which is great and remember <unk> deletion did not have any impact on this market share get all of these should market share games are organic and driven by the quality of our search product and.

<unk> of our platform the.

Installation has now been postponed to January 2021, and so hopefully we'll have impact on 2021 results, but obviously were extremely happy by very strong market share games on Android on desktop on desktop in fact in April our market share is now in excess of 70 per.

And our market share on <unk> on Andrew It in April it's 56% all of these are I think are quite impressive metric. Thank you.

<unk> <unk> like in a piece of just another one I just wanted to check what <unk>. The <unk> the impact of before dawn of of drive we're trying to studies for Rick That's a real reasons on the <unk>.

<unk> experiments you'd be though if you thought simple as assuming there's no. There's no revenue, but you still would have to pay for.

The meeting of the car so hard is going to work. Thank you.

That's a great question. So we have been able to renegotiate or at least in contract to essentially offset the.

Effect of the shutdown of the young sex drive and other carsharing companies in Moscow.

As a result of that you're absolutely right that we will not have the rabbit to go with it but also our cost base will be significantly reduced it's I think it's purely to quantify the exactly impact will be she'll relatively comfortable about this not being just a total black hole into which money will disappear on top.

That I think we talked about in the last quarterly call, we've already taken steps to optimize the size of the fleet.

To align better with the demand for this service.

And you know I think generally.

<unk>, who will still lose money in the index drive segmenting cue to it's not like we were able to complete did for all of our lease payments, but it will not be a black hole that I mentioned.

Thank you so much real helpful. Thank you.

Hmm.

Thank you very much the next Christian today comes from.

<unk> from U.B.S. Please go ahead.

Hi.

<unk>.

My first question what will be on the cord that.

Could you please provide more color on the cats are very good God right.

That's fine the advertising, particularly what technique than jogging, that's <unk> over the past couple of days and if you can't disclose what is the condition of actually <unk>.

Surely on its Greg when the try to to answer that.

So <unk> I'll take your second question first just because it's it's easy S.M.D.S represent approximately half of our advertising revenue.

And what's interesting is over the last you know a few weeks, we actually don't see meaningful difference in the performance of SMB segment compared to the large enterprise segment within the advertising but.

You know the important thing to keep in mind.

Is that.

For S.M.B.

Yeah Index.

Index search index advertising network represent oftentimes the only.

Sales channel that these businesses have.

And as we've seen in previous.

Economic contractions.

Mmm Yeah. These this is the last thing that people turn out.

Hopefully the answers the second part of the question onto the first part of the question you know across categories. What I said in to prepare the marks is obviously was jean strengthened sectors like I can't Telecom E. Com, you know home home and garden, what's under pressure is things you would expect.

Things such as travel thinks things such as auto member auto dealerships had been ordered a shut down I think almost a month ago.

So as you would expect you know advertising their has declined pretty precipitately apparel, it's been another.

Again, not huge cries another category that's.

That's a bit under pressure in terms of what we're seeing in terms of trends and what's meeting us to actually see potentially see green shoots his accent performance over the course of people has been tracking up into the right from the initial shock, we're seeing better performance out of finance insurance wishing better performance at a home and garden.

We're seeing better performance I'd be to be what you know, it's basically flatlined at yeah.

<unk> disappeared as as a category so just travel.

Eating out as a category has basically.

<unk> you know, it's not getting worse, but it's not improving.

Things like health care is improving I can't telecom is improving building repair services are slightly.

Hopefully that's enough color.

Oh.

Yeah <unk>.

Hmm.

Yeah, It's really good times. It provides it's quite good cool, but could you put comment on do you play Craig correctly every year, Okay. How does it <unk>.

Mm.

Yeah, let then you'll take that one [laughter] Hello, again, it's and Daniel.

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Yeah, Yeah, Uh-huh, Oh, Oh, Oh, let's go ahead.

Oh birthday, great significantly below Oh, locator, alright now.

Oh and the effect if they crave equal one wasn't below 10%.

<unk>, so, but <unk> drivers in the form of different types of weekend.

Well, they're all it was probably 19.

<unk> alright, getting input from a total of two 250 to be then <unk> well equal one it was approximately 75 billion rubles.

Oh, maybe <unk>, if it's to make sure. They found it all <unk> only <unk> he'll say well also doing everything back into providing additional income.

So we I noticed in <unk> and this is just the thought that's what they're doing a girl to support hour drive.

Oh team could also be working to continue to talk to find you way.

<unk> additional right.

So we crazy and launching your services.

As I mentioned before we launched a different type of fuck actually because it because I play a census market also you have to a couple of power fin go <unk> <unk> <unk> <unk> believe it and they believe without another big thing for.

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Hmm poor financial trunk, you feel a little could ever do them together and it goes beyond what the impact or <unk> Oh for commission.

You believe that <unk> is much much more effective and sustainable way support our driver emphasize it rather than just.

Typically reducing the commission.

Okay.

Thank you very much. The next question today comes from the line of.

Yeah.

<unk> from Goldman Sachs.

Yes. Thank you very much for the <unk> the <unk>.

Right.

Yep.

Yeah.

It gets to it's quite difficult speaking just give us a sock and we have some technical difficulties.

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Okay. Please go ahead.

Yep. So much up question wasn't such module. So they were quite strong into one I'm wondering how much of that was affected by that one the fact that if any <unk> I thought it any elements that well that queue for much in the weakness and basically how sustainable of those margin that would be if there was no.

<unk> so for the full yeah.

Hey, <unk>, let me try to take that so I wasn't in terms of one offs. Obviously the decision that top management is made to forgo cash bonuses as well as to voluntarily cut.

Their salaries, we'll have an impact a positive impact on margins throughout the year as you obviously start to recruit them from January 1st the other positive impact is on the back of tack and this is some distribution tax specifically and if you remember this is something that we talked about an acute earnings call, where we said we'd expect to see.

Benefits from distribution tack in 2020, and you're starting to see that come through.

Other things that are you know will be off setting that will be investments and things like content and so on both within the search Porno segment remember, we have content search portal as well, where we show videos in young <unk>.

<unk>.

With respect to margins overall I think it's just very much a function grabbing years and they're very hard to predict at this point.

And obviously, we're trying to do everything you can to reprioritize projects to cut costs, where we think it's prudent to <unk> to do so and to reallocate our investments to words things that we think we have the highest returns pressure holders.

Ah Okay. Thank you so that kinda second for me can you describe competitive grants across the different business units.

Maybe you can observe any market share up it's unique it's a seven sub segments and generally what do you envisage the crisis that to create especially a bunch of units can you.

Please.

Sure <unk>.

I think I hope it'll prove to be you know real blessing in disguise Where's she incredible strength in terms of gaining share in just about every vertical <unk>, which we compete we gain share and ride sharing and Q1 <unk>.

We've done very well to delivery, we've had a lot of success with our hyper local grocery initiative young <unk>.

And we've also gained considerable share in search as I talked about and then if you look at something like the the news feed product, yeah and exam.

Clearly that's growing incredibly strongly and you know last week, we were teasing with 17 million daily average users, which has you know up quite a lot since December.

And the trends, they're they're pretty strong so I I think while obviously it's.

Hard to predict how everything will shakeout, we will certainly faced headwinds with respect to advertising revenue and other things I think that this will.

This crisis will really demonstrate the strength of the platform that we built.

Okay think at a much better.

Thank you very much we seem to have lost the <unk>. So let's everyone can please pray style, one again and you come back into the question cute, we <unk> from D.D.B. capital.

Go ahead.

Hello Regulation, then I'm, Brian. Thank you for taking my question.

First of all I wanted to to ask you what if he already knew of Andre was them in March because usually provide good numbers and they would like both sets you maybe clarify on the advertisements <unk> correct me, if I'm wrong, but as far as <unk>. That's you see some improvement.

<unk> clique, but what about pricing and said what about <unk>. If we look at the April situation, how would be developed right now thank you.

Have vitamin here on Zen. So then run rate was down a bit compared to December the annual revenue run rate was around 8 billion in March I compared to 8.8 billion in December.

And that's obviously on the back of the impact from coded 19.

Well the you know engagement trends had been extremely solid total time spent with 56% in March and April 5th does growth accelerated some 90%.

And then you know people are spending in April almost 13 million hours per day with you and exam.

And then with respect two clicks.

And C.B.C.

Easily what we're seeing is that you know well <unk> clicks growth is rapid C.P.T.'s the decline.

And that trend will likely continue with the C.P.C.

Which is just the result of overall advertising being you know weaker this year than it was last year.

And having kind of a four month impact of that as opposed to just just the two weeks that we saw in Q1 or so.

But what's important to keep in mind is that I think today.

Search.

Is borrowed on the highest R.O.Y. platform for advertisers and as a result of that the trends that we're seeing in search which is recovering faster than other forms of advertising I think is what's driving that it's the highest R.Y. platform for advertisers both.

Large enterprise clients as well as suppressant as and B.'s and that's why they keep turning to it.

<unk>.

<unk> <unk> <unk> you couldn't <unk>.

That's clear.

For for for advertising.

Well, it's just what I've suddenly prepared remarks, which is in April overall advertising saw a high teams decline.

And then if you look at the last few weeks the decline, especially in church has now been reduced to high single digit decline.

In fact, there some days when we're seeing flatish slightly positive.

Advertising trends on search in April.

That's it paints and maybe a few [laughter], but one more question the on the right pay like.

Partnerships that you have currently with as many of retail us, but you <unk>. Okay play with <unk>. These partnerships <unk> business model <unk> for the development that would be if it's going to work. After the long don't curious to use over do you see like fresh up for Q.T.C.N.B.

What is it <unk>.

Yeah, maybe potentially <unk>. Thank you.

Daniel.

So look you see the the trend overall into separate real change. So it was that people will start to buy online much more often because it wasn't before.

That's why we believe that this is offending business model for us in the <unk>.

So we are right now it's miles an hour cost structure, whether they do it to <unk>, even more in some cases.

<unk> a choice number one in terms of course this book the for the <unk> for the company's <unk> signed a bus I should do.

Thank you very much.

Thank you very much. The next question today comes from the line is.

A decent from Morgan Stanley. Please go ahead.

Hi, Thank you set of code and great <unk> during on what you just to know about such being the highest.

Appetite did just wondering how you're thinking about such great <unk> down and you can't see into a recession. There's a lot a tool that is so good at declined the t. at that time would you agree with that that's how you thinking about how such grows in <unk>. That's your environment <unk> 15 to get.

Now it is the highest chats market just wondering how you're thinking about it.

Yeah environment.

[noise], Hi, Miriam I wish I had a crystal ball I don't I don't know how digital advertising will perform I think it it certainly possible digital advertising will be down in 2020.

But first of all digital advertising still offers one of the highest R.Y. opportunities for advertisers and I think that advertisers will keep turning to it.

Head of other forms of advertising.

Now you know obviously <unk>. This crisis is different from 2009, it's different from 2015.

Digital is much larger as a percentage of told pie. So there's not a secular ill when as much of a secular tail behind it plus you'll have the combination of <unk> and G.D.P. contraction from lower oil prices.

And we can <unk>.

So <unk> you know all we're trying to do and all we're focusing on is delivering high our ally to our advertisers delivering click high quality clicks to advertisers developing you add formats for advertisements and.

You know getting them to best tools that we can to go after their audiences now whether or not search will be down or not surely didn't tell whether or not digital advertising will be done or not too early to count, but we're certainly modeling all sorts of scenarios and so when we do run various simulations.

Scenarios, we do think that it's possible for it to be them.

Okay <unk> and then my second question just on the taxi margin did a cool.

Delivery just wondering how we should think about the sequential margin for question asked that second call with that given I guess, you will have a not yet impact from Alaska.

Hi, Miriam obscene <unk>. So you know, let's talk about right hailing first.

You know in Q1.

We had a very solid growth, but going forward out based case scenario sort of assumes that becomes decline and rising the second quarter.

And again it was I also don't have a crystal ball like Greg, but we see some gradual recovery in the third and fourth quarter.

As we mentioned earlier in right hailing a variable costs two thirds of our total costs, including incentives and in terms of fixed expenses.

When we look at our business in the next quarter and through the rest of the year. We've made significant cost cuts primarily in advertising and marketing, but also in the supply acquisition costs and sort of another operational costs, and we're a deer prioritizing or differ in certain projects that I noticed.

Central at this point.

Obviously, we'll have significant additional costs related to their pandemic, including our 500 million the ruble fun to support drivers.

And also expenses related to the purchase so various messing disinfectants costs related to the transport of medical personnel and call. The tests that we're doing.

And also support to new restaurants, where where waving commissions to new restaurants, I didn't have certainly initiatives.

So.

It's difficult to make any projections at this point, but you know for play around with numbers.

In case, we have a 60% you over a year or decline and right here Lindzey mean, the second <unk>.

We have you know we often you know most likely will post and even dare lost in right Hayley that particular quarter.

In case, our consolidated.

Right hailing julie's down 40 per cent in the second quarter I think we're gonna be break even with the current cost structure and that's a cost structure that is geared to a rapid recovery and regaining the volume's post quarantine.

So if we compare second half of 2020 to the first have.

You know, we expect a right hailing business to be profitable an annual basis.

And if you look at tax overall of course, it will you know overall kind of results will depend on our.

Our investments in you know so driving cars and a rapidly growing food tech business. So we will continue to invest aggressively in our each business.

See some improvement than unit economics.

And it's a area focus for US you know the economics of each business. So for the year. We expect you know I significant improvement in the last March in a off our young <unk> eats towards the end of the year.

And <unk>, our hyper local delivery business isn't investment stage.

We have grown lock a significantly from 50 stores at the end of last year to over 100 stores are currently has already was mentioned I think.

Ah, but our average daily waters grow grew 350 per cent versus the end of life, we versus December of last year.

On G.M.B. a grew in the center you know 550 per cent.

And when it comes to lock or we will continue evaluating growth opportunities and sort of the intensity of investments will be a function of our success in the format for the rest of the year.

And we will continue to invest in his B.C., because we believe it says strategically important area over the last month for us for the company.

Yeah, and one thing I would like to mention was already mentioned, but to highlight that we have a very strong balance sheet.

We have $393 million most of it isn't actually in U.S. dollars.

So we think we're in great shape through go through the current situation and very well positioned to continue growth once were pushed past it.

That's great. Thank you.

Thank you very much. The next question today comes from the line of Sebastian Patchily from <unk>. Please go ahead.

Hello.

Thank you for a long tough question fallout <unk>.

Basically it appears that didn't get relation you they turning away from a small smartcool schools and more towards larger ones that says <unk> laptops and the L.P.C. It just the kind of the hatred as soon as well in April and should we expect some merging tell them.

I've been involved in.

And secondly between March in June 5th year, a Unix slipped into the fold search engine selection window, and it's funny F.L.M.B. a that'd be all these pretend Poland. If they felt a bit above the initial the both of this action and some of the 10 years team here. Thank you very much.

Hi, Sebastian in terms of the mix of.

Desktops versus [noise] mobile devices, I would say it hasn't changed dramatically I'd say the mixes changed a little bit in between the days right where for example on weekends were seeing slightly more.

More desktops than we ordinarily do.

But I would say, it's not a huge change so I wouldn't.

I wouldn't build into two models, a huge impact on that one way or the other.

And if you look at you know if you if you look at where where track in terms of the percentage of search queries, which are coming from mobile those are still up in in Q1 right in Q. for approximately you know 57.5% of our.

Search traffic for mobile you want it was 59%.

And then with respect to to the.

European Union choice screen.

That will apply to new devices.

So if you call. This is similar to how it worked.

Would it be anti trust element in Russia, it impacts new devices. So takes quite a long time for.

The amount of devices, which contain the choice screen to actually penetrate into the installed base. So.

It's something that will take a while to show up in the data.

Thank you very much.

Thank you.

Thank you very much the next question today.

<unk>.

Please go ahead.

Oh, Thanks, two I guess, both for Greg you know, Greg I know you don't explicitly breakouts workforces display any more but can you give us a sense for how course search trends look relative to display.

And then the second one would just be on the F.X. move.

Yeah, I think you guys have have moved the lease volatility off the P.N.L. I tell your cash flow statement, but <unk> you know I should we expect any changes in personnel costs.

<unk> around the currency weakness.

Given the kind of global competition, there town anything you can share there would be helpful.

Hey, Lloyd so.

You're right that we don't break it out but I could you know just give you some color display it's certainly getting hit much more.

Then contextual advertising the performance advertising. The reason for that is most of the purchasers of display advertising or are large enterprises and those tend.

Two reactor quickest and most.

<unk> dear form to external events.

And so.

We <unk> that was down more than other forms of advertising and Q1, and we expect to get worse and q. too.

And then with respect.

To your second question, just remind you what it was again I'm sorry.

Yeah, the effects impact to kind of personnel costs or other areas, we should be keeping an eye on oh, right and and then also immigration. So given that most countries are shut down with a with Kobe right now.

So far we're 19 meaningful impact from affects devaluation, the way that effects will impact or piano.

Not as group now as they were back during the last crisis, we hope that we've learned some <unk> some of our lessons them.

The impact will come in the castle statement, where the server purchases are still you was dollar denominated and we still need those servers as we continue to invest in our various plastic ones.

So.

For now we are Reprioritizing Ah Argh Catholics, and we are attempting to optimize it in such a way such that the ruble denominated amount for aggregate <unk> isn't significantly different from our initial budgeting.

Under the previous that's next regime.

Okay. Thank you.

Thank you.

Very much.

The next question.

<unk> from the line is and <unk> the from gets pumping.

Oh, Thank you very much for presentation end up like teach a class question. My question is kinda Guy can get online advertising as far as a he your talk costs as share well <unk> <unk> <unk> <unk>.

Scientists sustainable well. So my question is it'll go to share <unk>, if I can Hugh <unk> is going to be on the same level <unk> <unk> <unk> <unk>.

Hi, Anna on a tack front, we certainly do expect that distribution Tac shouldn't be a bit of a tail wind.

We talked about in the queue for earnings call, where we said that we expect that distribution tack will grow materially slower.

2021 versus citing 2020 versus 2019.

So I kinda answers the question on distribution tack on partner attack. It's still T.B.D., we are working with their advertising network partners and we are trying to find what the optimum point is there but it's.

It's certainly possible that will reduce as well.

And then finally.

Your last question was about.

Remind me.

Oh, Yeah, and <unk> <unk> online.

Mhm.

Right. So we we are certainly hoping that we will get more traffic and we <unk> more revenues out of our property to invest in quite a lot into into them.

I think the quality of our property, there's going on we're integrating them better into our product for example, the way we've integrated Zen I think much better into the search out and and the annex home page and so our expectation is that yeah looks properties should grow.

Well and should continue to increase like as a percentage of tool.

Mhm. Thank you very much on the US Oh, well then it could pull off <unk> any changes since pulls for blind.

Data.

Sure. So you know to date, we bought back four and a half million shares.

And we spent around half of the 300 million a dollar buyback program.

Are sort of decision between buybacks investments in the business sort of what the done whatever brings the highest return to shareholders.

And so right now there's kind of no specific update but we will be you know I expect that we would be buying shares back from time to time that attracted prices that we've we've done before.

Mhm.

Me too much.

Thank you.

Thank you very much.

<unk>.

Yes.

AH yes, good afternoon, I went to <unk> <unk>, where the <unk>, we should expect from New York, So racing human activity, especially considering your cash file.

<unk> at all it's the second to run a laugh caught the boost in order to us that you've seen recently I do enjoy <unk> that orange across I don't want something you can get where you can come in <unk> in prefer that four locations to become profitable.

Yeah.

Sure Maria.

You're Guinea will answer about laska, and I'll try to answer about emoney activity. So obviously, having about two and a half a million dollars of of of dry powder is extremely helpful. In this environment.

Because they provide this with dziedzic flexibility to do deals Opportunistically and so we we are looking at various assets out there and evaluating them, but it's a question of you know how strategic are they is the price attractive and is is the highest.

Right.

To to our shareholders.

You're getting maybe can answer some questions on on Oscar.

Yeah, Maria Hi, <unk>, well I <unk> I wouldn't give you an exact number but yes. We do have locations that are sort of pre overheads. He did a contribution positive but it we're just.

To point out that not only whereas ground grow in the top line at Lapka, but we're very focused on improving the margin picture and sexually improving.

If not you know month to month, and maybe one week to week. So yes. Our goal is to have of course you'd be profitable stores.

And we're seeing significant progress towards that.

Just to think.

Doing much.

Familiar.

<unk>.

Oh good afternoon. Thank you very much for the presentation [noise] I have two questions first of all about herself driving cars and the need yeah investments. So both project where business lines are in.

It's different investments page, so I wonder whether you in current conditions, so damn too steep till your initial investment. Please e. himself driving cars and media <unk> or you have all some weights or I'm going to me to some kind of.

Budget adjustments <unk> going forward [noise].

The second question is on the on the market well degrades to understand to have any indication from you whether you have negotiated with a your partner.

Oh, so any adjustments and the and the younger market the budget for this year, so any transcend developments have yandexs markets.

Hey, Hey, I take this <unk>, Oh, Oh, Greg you want.

No no it's okay, yeah cut off Hannah.

Yeah, sorry <unk>.

The sorry <unk>.

Okay. Yeah may take that question about the L.D.C.N. the media services.

So on me just services side <unk>, we are going to continue to invest in content to emptying the service we.

See that.

Especially.

During this call that situation it became significantly more attractive than ever.

And.

This is this the services as one of the and if he sure of that situation.

<unk>.

On as this it a little we still committed to develop this technology.

So we.

More or less planning to to continue to increase the size of the fleet and the team size. So independence on how revenues what I mean is a real c. for a little over business <unk>, probably we will.

Adjust our plans, but this is long term investment than we believe that mean long term of label to correlate.

The.

Fool level five.

So we're running technology.

And then on on you know obviously immediate services I think it's it's been agreed beneficiary of this pandemic plus we pets <unk> some content.

Original content that we develop ourselves.

Which was released.

On the platform fairly recently and it's performing extraordinarily well, we're very happy with that and I think that media services as part of this big Young <unk> plus ecosystem is a very important strategic ass if.

Finally annex marketing again, it's another you know massive beneficiary of detailing from a pandemic and so we're continuing to invest in E. Commerce and obviously, we're also investing in young <unk>, which is outside of the joint venture. This was either specifically carved out from the joint venture as a high political.

A convenience store model isn't there a weird <unk> you know incredible demand as I said, you know sales in Laska grew about 550 per cent from December to April.

Yeah.

The Christian we have.

<unk>.

Hello.

Fox recovery in like Eric why why the logged on that's <unk> or or else about how do you <unk> <unk> yeah. Thank you.

[noise] sure well if you are actually compare with our global peers. You know I think first of all we have a relatively small portion of rights to the airports. So in Moscow at <unk>, the single digits, a and very low single did.

<unk>.

And of course, I'm talking about pre corvette situation, we did not have pool services.

That not currently used that are offered by over an hour competitors.

You know just to say and all that right now we had before quarantine restrictions, we had a very rapid growth in usually show or a premium tariffs which are currently.

Restricted so overall with a small portion of airport right.

<unk> return of the premium tariffs I think were very well positions to recover once the log down restrictions are withdrawn and also I want to highlight that as any other business core writers of hailing who use the service frequently generate such down.

Show portion of the G. me.

And wants to quarantine restrictions will relax.

I'm way see we will see the majority of these writers resume to their normal usage frightening.

So.

<unk>.

Yeah.

Mmm.

Thanks, very much <unk> very helpful.

Thank you very much.

<unk>.

Would you like to conclude.

Hi, Yeah. Thank you very much. Thank you everyone, Virginia alcohol can be if you have anything to question <unk> wouldn't be happy to help you and thank you very much bye bye.

Thing.

Today.

We'll just.

Pardon me.

[music].

[music].

[music].

Hello, everyone and welcome to younger first quarter Twentytwenty earnings call. What do you see that oney Sweet earlier today, you can find it all people not <unk> <unk> as well as the news was there.

Oh, the coating, we'd have gone would ever done Deputy Chief Executive Officer, then usually <unk>, our chief Executive officer of Yandex taxi and Greg Abovsky out you, but the weighting in Chief Financial Officer, I've got a bullish of founder and Chief Executive Officer, They do marches, Oh VP of corporate development and you give me syndrome.

Chief Financial Officer, and expect will be available when the kids fashion.

Well when do we quoted in the recording will be available on <unk> I didn't you hours and he was always the part that you supplementary slides, which are currently available on the that's right now I will quickly walk you through the Safe Harbor statement. The livestream are the main during this call about our future expectations plans and prospects constitute forward looking oh.

Actual results may differ materially from those indicated or suggested by these forward looking statements. As a result provides important factors, including the impact of the only 19 pandemic as one of those to stop and at least Dr. section of all in a report on form 20-F dated April 2nd Twentytwenty, which is on file with the FCC.

<unk> online.

Additionally, any forward looking statements represent our views only as of today and should not be relied upon as representing all views as of any subsequent date.

Although we may elect to give these forward looking statements at some point in the future. We specifically disclaim any obligation to do so even if you change.

Therefore, we should not rely on these forward looking statements as recent thinking all use of any big subsequent to the date.

You mean, the goal will be referring to certain non-GAAP financial measures. This non-GAAP financial literacy lumpy part in accordance with you had GAAP a reconciliation of non-GAAP financial measures for the most directly comparable GAAP measures is provided in the earnings release when issued today.

And now I'm, joining the call over the decline.

Thank you you know I think before joining our call today, the first quarter structure well for US all of our business is demonstrated solid performance above don't need March when we started to see an adverse impact from Colby.

Since then our top wrote it hasn't been the wellbeing <unk>, our partners and our users while some of our businesses such an advertising going to ride hailing that'd be significant <unk> by the trick towards social do something measures introduced by the authorities.

Matt <unk> ecommerce education, a media services has materially Gleason, let me turn to a brief overview Q1 trial.

For what is causing <unk> colby related initiatives.

Search and portal segment was growing well head of <unk> internal expectations in January and February.

Fortunately, we enjoyed where were strong source showed gains both for mobile and desktop in March where reached a record 55.9% Sherman droid growing 130 basis points from December and 440 Bips from March 2019, our oral show continued to grow strongly approach.

60%.

So where would girlfriends mature really accelerated apple to 40, 45% year on year from single digit use it and over the February importantly, the key driver for these was a girl for young audience up to 24 years.

Sure so traffic can squeeze, but 28% compared to February why the show schoolchildren increased by 56% the practical school audiences itself almost doubled for the same period.

You want our mobile search traffic was 59% forward total sort of traffic.

Mobile revenues represented 50.4% unfold.

Equally the fourth quarter with Newbuild source of revenue exceeding that'll desktop.

Turning to them.

Continued to see strong views will go with 14.6 million daily active users in the March Whalen, Apple them daily active users increased well, though to over 60, new end users in terms of engagement total times pen grew 56% Youre your.

While an apple girlfriends accelerated to almost like people are saying.

Immediate service the total number of subscribers reached 4.3 million in March and continued to grow for the Apple.

Number of Walker viewing subscribers all that Kinda boys gives you platform has exceeded 1.5.

Now, let me walk you through our key action point in response to the Colby I'll break.

Firstly young to create an important source of add to it and reliable information horrible users, including all rebel and data on coal.

On numerous public information you should be as we have entered use the so utilization real time.

The only unexplained breach.

Indic shows the degree of social distancing different cities by comparing can only mice. They got one urban Pvp agave, a normalized date before that pandemic.

Index is currently available in 570, SIMPAS in Russia, as well as eight although countries.

Secondly, our platforms, such a yandex taxi Galaxy Pizza, Oregon, That's Lapka provide earnings for hundreds of thousands of drivers in four years. For example, we have invested significantly in expanding delivery service as well as our food delivery platforms. So these kind of learning we launched the Ondeck school as a platform.

Combining all love or new and existing educational projects, including a full scale like school for five to 11 great.

15 different subjects in absolute Yandex taxi book Daily active users increased eight times compared to March and exceeded one Leland users.

And last but not least our social and you just he's helping cap.

With this project would transfer doctors and deliver medicines provides core wires testing Keith and distribute essential goods. We have contributed 250 Mueller rubles for this project.

World, We have committed around 1.5 billion rubles across various initiatives, including supports funds for taxi drivers for years advertising credits to small and medium businesses and our educational efforts. The full we still measures and you should this is much longer our old teams are working really hard did using new.

Features and services frankly, I think we have never seen initiatives and improvements being implemented at such a rapid pace looking beyond the pandemic I will keep proteins to ensure sustainable long term goal that belief that we will emerge from this crisis stronger than ever the current down to coupled with that.

Changing consumer behavior provides us with a number of attractive long term opportunities across many multiples.

Quarterly timing business, we expect to benefit from accelerating sheets from traditional advertising to only higher consumption of streaming video in media service and diesel quantify in that.

Its corporate which would seem to their operating models to include more remote worked in there which will benefit from buffer adoption of cloud services.

There are also lot of attractive opportunities in whitetail Lincoln Foodtech and with these I'm turning the Mike over to the Neil.

Thank you, Brian and Hello, everyone. We started the year exhibit solid performance across all our metrics.

Right.

The percentage year over year in Q1 was gender an ever growing ahead of our internal projections.

We saw the scene slowed down into second half of March due to the spreads fall will be thinking.

While in early March we got the nearly 5 million rights birthday towards the end of March this number decreased significantly and the dogs that affected Q1 gross.

The piece a little bit down in Moscow stopped at March 30.

So we will see a much greater impact on our business in Q2.

In Moscow right here in the hit that severely in Moscow JV has declined approximately 60% year on year, EPS, Oakland date, and around 70% compared to only much.

Outlook right here in JV declined less than in Moscow, and lesion Okcupid <unk> should be behind must in terms of Colgate maximum back.

We made significant investments to protect driver sneakers.

For what is kind of how much you supplies and the timing and that was the quite cartons section.

Submission 500 million ruble, Paul will support teams have been affected all currency.

The team is working five to provide meeting up but you just whats rivals Doosan did you.

We provide some transportation services to doctors have you test and you said clinics and senior citizens.

Bush and nimble partnerships is less retail companies, including there on the land yet can you tell it too.

At school so.

No that the club that make the leaders because they use or sometime in men.

On the Crown.

Enjoy significant growth in demand.

The inflow of new restaurants, so outlets from significantly increase.

Misinterpret the unfortunate process formula.

As of today over 20000 trust I connected to our.

No not to support booklet on newly connected to our that's when we eliminate the commission for them.

Nothing to deliver it has become an essential part of people what does that and they have benefited from it and how hyper local kobi or did you remodel locker.

As of today over 100 docs talking more content.

From Beach, our digital and 10 to 15 mean, despite significant growth in demand.

Recently, we expanded the service coverage by connected Texan jobless lot.

No. It's available approximately two so it's always a Muslim population and over half the people tempted to smoke.

So far number of users of our several.

1% to 3% compact, but very much and this is 150% increase year on year.

There isn't the launch so perhaps contributes a dozen gross.

And this is they love it if it so it's orders from Super.

Oh, no we see multiple opportunities down the road the Kraton community must say that's one of the most unique companies in the World is unrivaled nation logistics technology and supply of drivers, including is to instantly become an essential part peoples life.

And turning my although still Grad, who will walk you through the financial.

Thank you to Neil and thank you all for joining our first quarter earnings call today, you've seen the press release with our key financial numbers. So let me repeat.

Let me focus in the performance in current trends across our businesses search and portal.

Search and portal delivered solid results, despite tough comps and the convention impact starting from mid March revenue ex Tac increased 14% well adjusted EBITDA margin came to 40.7%.

30 basis points you every year.

Given the strictly enforced lockdown policies across the country and its impact on business activity or ex Tac search and portal revenue decline in April is in the high teens territory I don't want to stay basis. This was driven by a combination of factors such as decrease in AD budgets pressure on CPC dynamics and lower share commercial search queries import.

Our search queries April are growing at the fastest taste in five years and clicks growth accelerating the Hammond of ex Tac search revenue in the last several days has recovered to high single digit decline.

To wise, ITM Telecom, who do grocery delivery health care at home and garden have performed relatively better while travel apparel real estate and auto or under more pressure.

That said I want to distress a few things first of all decline is clearly driven by external factors, which are largely outside of our control before cobot, our Janet that revenue growth ex Tac basis within the high teens territory.

Secondly, our main goal now is to grow market share and user base. So that when the economy rebounds, we can convert into revenue growth and our progress here is impressive, especially for the younger audience.

Overall, the revenue dynamic for the full year will depend the duration and severity of lockdown measures and economic impact as well as the speed of the recovery all of which are hard to predict at this stage.

Couple of words about the cost structure of our search and portal business the fixed costs accounted for around half of until cash costs, and a search and portal second or personnel as the largest component.

The variable part includes Tac and cost of sales.

Moving to taxing.

Taxi revenues increased by 50% year on year, primarily driven by 40% growth in a number of fries continued optimization of incentives and the right healing business as well as the rapid development from Tech services.

We've managed to expand our adjusted EBITDA margin, excluding self driving cars to 7.6% on the back of improving profitability ride hailing offset by our investments in Moscow and the overall weakness that we saw in late March and ride hailing variable costs represent approximately two thirds of our total costs, including incentives while the remaining.

Art is fixed cost and some personnel costs rent certain advertising and marketing as well as other operational expenses, we see opportunities to optimize cost, including advertising marketing supply acquisition costs and certain overheads.

Yeah and exceeds we saw further improvement in the unit economics, primarily as a result of increased density of orders. We've continued investing locker, while being mindful of the impact of this business Untold taxing EBITDA.

Turning to other businesses.

Media services demonstrated very strong revenue growth of 95% year on year with improved adjusted EBITDA margin both than a year over year end quarter over quarter basis.

Q1 subscription based revenues of media services, 252% year on year, when we see strong trends continuing to April.

Got you investing in the business as planned and are focusing on the retention on users.

Our classified revenue increased 35% in Q1 the growth in the first two months was very strong. However, we saw material slowdown in late March after all auto dealerships in order to close which obviously has a very meaningful impact on this business unit.

Well the pressure on classified revenue considered eagle and traffic at our platform remains solid we see the formation of deferred demand, which we plan to monetize as soon as the business activity starts to rebound.

Finally onto other bets experiments.

Our revenue is almost doubled year over year term by the growth of young mix drive Geo enzyme.

I think stride cloud NGL. We're also the key drivers of our adjusted EBITDA loss of 1.9 billion rubles.

As John mentioned Zen continues to perform strongly in April while our car sharing business has to go ahead, especially after Carsharing services were suspended in Moscow and Saint Petersburg on April 13th.

We can't make strides we're now focusing on optimizing our lease agreements and the size of the fleet in order to reduce the burn rate.

Guidance.

Even a difficult in predicting how long that pandemic will persist and certainty about its effects and the economy in our businesses were unable at this time to reliably quantify impact of the covered 19 outbreak on our future financial results as such we're drawing our 2020 guidance, which we provided on February 14th 2020.

Now what are we doing to mitigate the cover 90 impact our performance.

We developed various trust us that helped us to define priorities and these priorities include investments into businesses with increased activity and higher social importance in the current environment as a strategic projects to strengthen the company's position in the long term.

After onboarding around 3100, new plays in 2019, and another 333 people in Q1 2020, we have decided to slow down the piece of higher given the current circumstances, partially because of the difficulties and integrating and train you people. We all work remotely. We also want to ensure that were appropriately sized when coming into.

2021.

That being said, we'd be continue adding headcount and certain limited strategic areas look for opportunities to redeploy our personnel resources to support and demand functions and our strategic priorities.

We've also made the decision to fourth in cash bonuses for top management in 2020 on top of that top management has accepted a voluntary pickup.

We're cutting non essential marketing expenses and exercising burgers control of our overheads.

We believe these initiatives will help us to reduce the adverse impact independently and the macro headwinds on or 2020 EBITDA.

In conclusion I wanted to remind you that our balance sheet strong currently have 2.5 billion cash, including 390 million on the tax you balance sheet.

More than two thirds of this cash is in US dollars all of our debt as long term and matures in 2025, we're confident that our strong liquidity position will help us to withstand the challenges. The current situation, while also providing us with flexibility to continue investing into long term strategic projects.

With this I'm trying to make to the operator for the Q any session.

Thank you very much once again as a reminder, if your question today. Please proceed.

One thing your telephone keypad and wait ceiling.

Can I. Please ask everyone just to ask one question plus one follow up.

And then priest.

Good question I once again, it's not even one question.

The first question we have today comes from the line of Cesar Tiron from Bank of America. Please go ahead.

Yes, hi, everyone. Thanks for the call and thanks for the opportunity to.

To ask questions.

So I have two I'll just have the first one.

Just wanted to.

Thank you could explain a significant increase did not in market share over the past couple of weeks I seem to be up the last reported that the market curious about 69% what is the what is the key driver and do you see a marketer to increasing.

Even without the help of offer you nation. Thank you so much.

Hi, Caesars, Greg can you hear me.

Yep.

Perfect.

So I think the main drivers for the growth of market share.

It's just that we have become the de facto standard.

For getting a lot of knowledge and information about that Corona blindness, as well as providing a lot of various options for entertainment and things like that.

We've launched the number of initiatives.

Oh that give people a lot more information about it and I think relative.

To relative to our competition the breadth of information as much richer and much more tailored to the local content context.

Things that we launched around education on such are also important in terms of driving the younger audience as we talked about in the prepared remarks.

So the younger audience, which historically has kind of probably skewed a away from us toward the competition has shifted their usage onto your ondecks, which is great.

And remember pink deletion did not have an impact on this market share gains all of these market share gains our organic and driven by the quality English search products and due to the totality of our platform.

The.

Installation has now been postponed to January 2021.

So hopefully we'll have impact on 2021 results, but obviously, we're extremely happy by very strong market share gains on Android.

Desktop on desktop in fact in April our market shares now in excess of 70% and our market share on it on Android and April it's 56%. All of these are I think are quite impressive metrics. Thank you.

Okay, Great cannot piece I was just another one I just wanted to check what the impact both the <unk> the impact of the shut down the off Oh drives are trying to studies for rigs that are reasons on the.

To chew experiments.

Oh, yes, it does simple as a assuming there's no there's no revenue, but your students have to pay for could the meeting of the course or how you're going to work. Thank you.

It's a great question. So we have been able to renegotiate our leasing contracts.

To essentially offset the.

The effects of the shutdown of the Yandex drive and other car sharing companies in Moscow as a result of that you're absolutely right that we will not have the revenue to go with it but also our cost base will be significantly reduced.

I think it's too early to quantify the exactly the impact, but we feel relatively comfortable about this not being just a total black hole and too much money will disappear.

On top of that I think we talked about last quarterly call. We've already taken steps to optimize the size of the fleet.

To align better with the demand for the service.

And I think generally.

We will who will still lose money in the Ondecks drive segment in Q2.

It's not like we were able to complete defer all of our lease payments, but it will not be black hole that I mentioned.

Thank you so much very helpful. Thank you.

<unk>.

Thank you very much a the Knicks Christian today comes from the line of you Liana Lenvalskaya from yes. Please go ahead.

Hi, everyone I think for lots of liquidation. My first question what will be on the core business could you provide more color on the categories in that particular to fight the advertising, particularly what sectors and driving this recovery you've mentioned over the past couple of days and if you can disclose what does.

Contribution of Atsis Caribbean.

Sure down its Greg let me try to answer those so I'll take your second question first just because its strategic smbs represent approximately half of our advertising revenues.

What's interesting is over the last few weeks, we actually don't see meaningful difference in the performance of SMB segment compared to the large enterprise segment within the advertising but.

You know the important thing to keep in mind.

Is that.

For Smbs.

Yeah Index.

I don't think search Yandex advertising network represent often times the only.

Sales channel that these businesses have.

And as we've seen in previous.

Economic.

Contractions.

Yes. These are the last thing that people turn out.

[noise] hopefully that answered the second part of the question onto the first part of the question you know across categories.

What I said in the prepared remarks is obviously, we're seeing strengthen sectors like ITM Telecom E com.

Home home and garden, what's under pressure as things you would expect things such as travel things things such as auto remember auto dealerships had been ordered a shutdown I think almost a month ago.

So as you would expect a advertising there has declined a pretty precipitously.

Carol it's been another.

Again, not a huge quite another category that's.

That's a been under pressure in terms of what we're seeing in terms of trends and what's leading us to actually see potentially see green shoots as I've said performance over the course of April has been tracking up into the right.

From the initial shock, we're seeing better performance out of finance insurance, we're seeing better performance at home and Garden, we're seeing better performance B to B, what you know, it's basically flatlined at.

Almost disappeared as a category such as travel.

Eating out every category is basically.

<unk>.

Not getting worse, but it's not improving.

Things like health care is improving ITM telecom is improving building repair services are slipping through hopefully that's enough color.

Yeah, great. Thank you and then second question will be on top.

Yeah.

Can you provide oh.

But could you please comment on the take rate.

Let me.

That's how the teams and we're not calling.

[laughter].

Yes, let then you'll pick that one [laughter], Oh again and Daniel.

10, assuming.

Yes.

Oh, Yeah, Oh go ahead, well, Oh gosh, they create significant them below our global.

Now for example, our effective to create equal one was below 10%.

Yeah, Hey, there's definitely show, but well worth commission drivers.

As a form of different types of incentives.

Well, they're all it was held in 19 earnings Bachman, Alright kit input from booked to 262 billion rubles, well equal one it was approximately 75 billion or.

I will make their work has been base is to make sure that hundreds or thousands of dry or superior only on our books.

He'll say well also doing everything becomes a present additional income.

So we are in the sense crimes are looking for both new this effort and this is Jeff that Bob what they're doing a girl to support our dry out.

Our team has also been working extremely hard to find you away.

By geography as additional right.

So were crazy and launching new services.

[music].

As I mentioned before we launch a different type of partnership is that because I play offence as Mark and also just a couple of box to go we announced our partnership with alone or Bad luck now believe it and they believe convicted that another big thing for us.

So right now that the different path medical profession, and a different bunch of ever.

Aim for financial trunk, you should look every they've got boom together it goes beyond that what the impact authorization.

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We believe that create income opportunity is much much more effective ankle thenumber weight support our gyro attach it rather than just.

Typically reducing the commission.

Thank you.

Thank you very much or the next question today comes from the line of it.

Yeah, just love to Tyrants from Goldman Sachs. Please go ahead.

Yes. Thank you very much a political <unk> mission is on such margin.

Oh I'm sorry.

Oh, sorry, yeah.

I guess, it's kind of course speaking just give us a second we have some technical difficulties.

Absolutely reconnected.

Okay. Please go ahead.

Yep. So much of question wasn't such module so they with whats wrong in Q1, I'm wondering how much of that was affected by that one effect that's a if any.

Or.

That is any elements that will that Q4 much in the weakness and basically how sustainable are those margins would be if there was no profit impact so for the full yeah.

Hey slides Greg.

Let me try to take that so I wouldnt in terms of one offs. Obviously the decision that top management has made a two forego cash bonuses as well as to voluntarily cut their salaries will have an impact.

Positive impact on margins throughout the year as Youve, obviously start to accrue for them from January Onest. The other positive impact is on the back of attack and there's just some distribution Tac specifically and if you remember this is something that we talked about in the Q4 earnings call, where we said we'd expect to see benefits from distribution Tac in 2020, and you're starting to see that.

Come through.

Other things that are you know.

We'll be offsetting that will be.

Investments and things like content and so on both within the search Cornell segment remember, we have content search portal as well, where we show videos and Yandex live service.

With respect to margins overall I think it's just.

Very much a function of revenues and it's they're very hard to predict at this point.

And obviously, we're trying to do everything you can to.

Reprioritize projects to cut costs, where we think it's prudent to cut to do so.

And to reallocate our investments towards things that we think we have the highest returns for our shareholders.

Oh, okay. Thanks for that kind of second somebody that can you describe competitive strengths across the different business units.

You have observed any market share opportunities across certain sub segments.

Generally what do you envisage the crisis that took great, especially about units or can you elaborate on that please.

Sure slots.

I think I hope it will prove to be.

Real blessing in disguise, where she incredible strength in terms of gaining share in just about every vertical which we compete.

Well, how we gained share and ride sharing in Q1.

We've done very well in the two delivery we've had a lot of success with our a hyper local grocery initiative Yandex lapka.

And we've also gained considerable share in search as I talked about and then if you look at something like the good news feed product younger exam clearly that's growing incredibly strongly and you know last week, we were teasing with 17 million.

Daily average users which has.

Quite a lot since December.

And the trends there are very strong so I think while obviously its.

Hard to predict how everything will shake out we will certainly faced headwinds with respect to advertising revenue.

And other things I think that this will.

This crisis will really demonstrate the strength of the platform that we felt.

Okay. Thank you much better.

Thank you very much a we seem to have lost the Q O Q. So lets everyone can please press star then one again.

And you come back into the question you Oh, we I will open line of Sledding Mabus billets from VTB capital.

Go ahead.

Hello.

Relation of the numbers. Thank you for taking my questions.

First of all I want to talk to your what if the revenue run rate was them in March we got usually provide good numbers and I would like both sets you maybe caloric play on the advertising Frank I'm trying to correct me, if I'm wrong, but that's part of down to the threat you mentioned that say you see some improvements you mean.

Colleagues, but what about pricing and so what about the general reading a trend if we look at <unk>. The April situation, how it develops a right now thank you.

Have white Amir.

On that so then run rate of was down a bit compared to December the annual revenue run rate was around 8 billion in March I compare to 8.8 billion in December.

And that's obviously on the back of the.

Impact from Cobot 19.

While the you know engagement trends have been extremely solid total time spent was up 56% in March and April that there's growth accelerated to 90%.

And then people are spending in April almost 13 million hours per day went beyond exam.

And then with respect to clicks and.

And Cpcs, obviously, what we're seeing is that you know well paid clicks growth is rapid cpcs did decline.

And that trend will likely continue.

With the Cpcs, which is just the result of overall advertising be weaker this year than it was last year.

And having kind of a full month impact of that as opposed to just the two weeks that we saw in Q1 or so.

But what's important to keep in mind is that I think today.

Search.

His bar and on the highest ROI platform for advertisers.

And as a result of that the trends that we're seeing in search which is recovering faster than other forms of advertising I think is what's driving that that's the highest ROI platform for advertisers both for large enterprise clients as lost suppressive SNB, that's why they keep turning to it.

Okay. Thank you very much share, but you couldn't corn on corn bread and you're trying to price of the moment.

That's quite yet.

For fall for advertising.

Well, it's just what I've said in the prepared remarks, which is in April overall advertising saw a high teens decline.

And then if you look at the last few weeks did decline, especially in church has now been reduced to high single digit decline.

In fact, there some days when we're seeing flattish to slightly positive.

Advertising trends on search in April.

That's it. Thank you maybe I can it [laughter] that one more question the on the right they do but Uh huh.

Partnerships that you have current niche within many retailers, but you can display I don't think quite good at a these partnerships and <unk> business model built on this partnership will stay in the book for the development, but would be if it's going forward after the long period.

Over do you see like fresh opportunities in depending on what is it looks pretty good.

And maybe potentially not be cut in fun. Thank you.

I wasn't very good Daniel.

So look we see that the trends overall in the September to change those are people with respect to buy online much more often because it wasn't before.

Yeah, that's why we believe that.

This is the Thenumber business model for us in the Wolfcamp a step.

For example.

Yeah, right now optimizing our cost structure for the do it to became a little more in some cases.

A choice number one in terms of course perspective for.

Yeah.

For the company's because when we find the partnership deals.

Thank you very much.

<unk>.

Thank you very much.

Next question today comes from the line of Marine diesel from Morgan Stanley. Please go ahead.

Hi, Thank you said, a cold and Greg just during on what you just know about such being the highest ROI thoughtful appetite did just wondering how you're thinking about such great. I mean, these I've locked down and potentially into a recession and there's a lot of took that did so could decline the t. at that time would you.

Agree with that assessment, and how you're thinking about how such growth in a recessionary environment compared to 2015, because obviously now it at that high chat market just wondering how you're thinking about it performed in that environment.

Hi, Miriam I wish I had a crystal ball I don't I don't know how digital advertising. They perform I think it's certainly possible that digital advertising will be down in 2020.

But first of all digital advertising still offers one of the highest ROI.

Opportunities for advertisers and I think that advertisers will keep turning to it.

Head of other forms of advertising.

Now you know obviously the this crisis is different from 2009 different from 2015.

Digital is much larger as a percentage of total pie. So there's not a secular tailwind as much of a secular tailwind behind that a plus you'll have the combination of coal that and GDP contraction from lower oil prices.

And a weaker ruble.

So you know all we're trying to do an all we're focusing on is delivering high ROI to our advertisers delivering click high quality clicks.

I was just developing new AD formats for advertisements and.

You know getting them the best tools that we can to go after their audiences.

Whether or not search will be down or not too early to tell whether or not digital advertising will be done in not too early to tell but we're certainly modeling all sorts of scenarios and so when we do run various simulations and scenarios, we do think that it's possible for it to be them.

Okay. That's it. Thank you and then my second question just on the taxi margin to the cool ride hailing heating degree just wondering how we should think about the sequential margin progression assets second quarter. Given I guess, you will have a larger impact from Alaska.

Hi, Mariama see again.

So.

Let's talk about ride hailing first or certainly you know in Q1.

We had very solid growth, but going forward our base case scenario sort of assumes the peak of decline in rides in the second quarter and again as I also don't have a crystal ball like Greg, but we see some gradual recovery in the third and fourth quarter.

As we mentioned earlier in ride hailing a variable cost about two thirds of our total costs, including incentives and a in terms of fixed expenses.

When we looked at our business a in the next quarter and through the rest of the year. We've made significant cost cuts primarily in advertising and marketing, but also in the supply acquisition costs and I'm sort of another operational costs and where do you are prioritizing our differ in certain projects that are not.

Essential at this point.

Oh, obviously will have significant additional costs related to their pandemic, including our 500 million the ruble fun to support drivers.

And also expenses related to their purchase or various masks and disinfectants.

Cost related to the transport of medical personnel and Cavatt tests that were doing.

And also supports the new restaurants, where we're waving commissions to new restaurants, I can have certain initiatives.

So.

It's difficult to make any projections at this point, but you know for play around with numbers.

You know in case, we have a 60% year over year decline and ride hailing do you mean, the second quarter.

We are you know, we often most likely will post an EBITDA loss in ride hailing that particular quarter.

In case, our consolidated.

Right hailing Jimmy is down 40% in the second quarter I think we're going to be breakeven with the current cost structure and that's the cost structure that is geared to a rapid recovery and regaining the volumes or post corn chain.

Oh, sorry, if we compare a second half of 2022, the first half.

You know, where you expect a ride hailing business to be profitable on annual basis.

And if you look at Texas overall of course, it will you know overall kind of results will depend on.

Our investments in you know self driving cars in a rapidly growing food tech business. So we'll continue to invest aggressively in our each business.

We see some improvement than unit economics.

It's a area of focus for US you know the economics of each business.

So.

For the year, we expect a you know a significant improvement in the EBITDA last March and off our younger eats a towards the end of the year.

And lastly, our hyper local delivery business isn't investment stage.

We have grown lockers significantly from 50 stores a band of last year to over 100 stores. Currently has already was mentioned live Frank.

But our average daily orders growth grew 350% versus the end of life were there since December of last year.

On JV grew in the center you know 550%.

And when it comes to Walker or we will continue evaluating growth opportunities and sort of the intensity of investments will be a function of our success in the format for the rest of the year.

And we will continue to invest in as they see because we believe it's a strategically important area of investment for us for the company.

And one thing I would like to mention was already match on but to highlight that we have a very strong balance sheet.

Oh, we have $393 million most of it isn't actually in the U.S. dollars. So we think we're in great shape through go through the current situation and very well positioned to continue growth once were pushed past that.

That's great. Thank you.

Thank you very much the Nick's question today comes from the line of Specced in Pet Chile from Jefferies. Please go ahead.

Hello, and thank you for a long tough question fallout.

Firstly it appears that didn't get relation users that turning away from a small smartphone screens and more towards larger one such example, laptops and Pcs or is it the kind of the 80, there seemed as well in April and should we expect some margin tecogen embedded.

And secondly between March and June this year, a young slipping into default search engine selection window in a it's funny I tell them, but the obviously had called Oh, let's just talk a bit above initial the bulk of its action and some of the trends you're seeing here. Thank you very much.

Hi, Sebastian in terms of the mix of.

Desktops versus mobile devices, I would say it hasn't changed dramatically I'd say the mix has changed a little bit in between the days right where for example on weekends were seeing slightly more.

More desktops, then we ordinarily do.

But I would say, it's not a huge change so I would.

I wouldn't build into your models, a huge impact one way or the other.

And if you look at.

If you if you look at where where track in terms of the percentage of search queries, which are coming from mobile those are still up in Q1 right in Q4, approximately a 57.5% of our search traffic from mobile in Q1. It was 59.

And then with respect to the <unk> European Union choice screen.

That will apply.

To a new devices.

So if you recall this is similar to how it work.

With the anti trust element in Russia, it impacts new devices. So it takes quite a long time for.

<unk>.

Amount of devices, which continue to choice screen to actually penetrate into the installed base. So.

It's something that will take a while to show up in data.

Thank you very much.

Thank you.

Thank you very much. The next question today comes from Louise.

Each bank. Please go ahead.

Well, thanks, HM two I guess both for Greg.

Greg I know you don't explicitly breakout searches display anymore, but can you give us a sense for how core search trends look relative to display.

And then the second one would just be on the FX move.

Yeah, I think you guys have moved the lease volatility off the P. and now I'll turn the cash flow statement, but what should.

Should we expect any changes in personnel costs.

Around the currency weakness you know given the kind of global competition for talent anything you can share there would be helpful.

Hey, Lloyd so.

You're right, we don't break it out but I could you know just give you some color display is certainly getting hit much more.

Then contextual advertising the performance advertising the reason for that as most of the purchasers of display advertising or large enterprises and those tend.

To react quickest and most in the most severe form.

To external events.

And so.

Weeks that was down more than other forms of advertising in Q1, and we expect to get worse in Q2.

And then a with respect.

To your second question, just remind me what it was again I'm sorry.

Yeah, the FX impact to kind of personnel costs or other areas, we should be keeping an eye on Oh right and then also immigration so given that most countries are shut down with the with Kobin right now.

So far we're not seeing meaningful impact from FX devaluation, the way that FX will impact our piano.

Our not as great now as they were back during the last crisis, we hope to we've learnt some of <unk> some of our lessons them.

The impact will come into cash flow statement, where the share repurchases are still U.S. dollar denominated and we still need those services, we continue to invest in our various platforms.

So.

For now we are Reprioritizing capex and we are attempting to optimize it in such a way such that the ruble denominated amount for aggregate Capex in 2020 isn't significantly different from our initial budgeting.

Under the previous FX regime.

Okay. Thank you.

Thank you.

Very much the Nick's question.

Jay.

From the line is.

And Cambria Nova from gets pumping.