The founder and CEO of Russia’s biggest tech firm, Arkady Volozh, told reporters on the sidelines of the World Economic Forum Wednesday that he would sell a small stake in the company together with the family trust, Vedomosti reported.
“Certainly, this is public [information]. However, not [the whole] my stake but a tiny share,” Volozh said. The sale of shares is needed to diversify assets, the Yandex founder clarified.
Yandex shares recently rallied after Prime Minister Mikhail Mishustin, who was appointed to the post in mid-January, voiced his support for the company.
President Vladmir Putin nominated Mishustin, who previously led Russia’s Federal Tax Service, for the position after the resignation of Prime Minister Dmitry Medvedev and his entire cabinet on Jan. 15. Those resignations reportedly cleared the way for Putin’s upcoming constitutional reforms ahead of his planned retirement in 2024.
Yandex controls 44% of Russia’s online search market, according to StatCounter. Google controls 52% of the market.
Yandex generated 71% of its revenues from online ads in the first nine months of 2019. An additional 21% came from Yandex.Taxi, the ride hailing business that merged with Uber’s business across Russia and several other markets in 2017. The joint venture also bought Vezyot, Russia’s biggest taxi company, last year. The rest of Yandex’s revenue comes from its online classifieds, streaming media services, and “other bets and experiments” like cloud services, virtual assistants, and smart speakers.
Yandex’s core search and portal business is its most profitable segment. Yandex.Taxi and its classified business generated positive adjusted EBITDA last quarter, but its media and “other bets” businesses remain unprofitable.
Yet Yandex’s strengths consistently outweigh its weaknesses. Analysts expect its revenue and earnings to grow 30% and 45%, respectively, next year — which are impressive growth rates for a stock that trades at 24 times forward earnings.
