Prosus N.V.: history, ownership, mission, how it works & makes money

A Brief History of Prosus N.V.

Prosus N.V., a global consumer internet group and one of the largest technology investors in the world, was formed in 2019 as a subsidiary of Naspers Limited. The company's creation was a strategic move aimed at unlocking value for Naspers shareholders and facilitating greater focus on its international internet investments. As of November 2023, Prosus operates across various sectors, including classifieds, food delivery, fintech, and online payments.

Prosus N.V. is particularly noted for its significant stake in Tencent Holdings Limited, a move that has proven financially lucrative. As of the latest available data, Prosus holds approximately 28.9% of Tencent, valued at around $120 billion as of October 2023. This stake represents a substantial portion of Prosus's net asset value, highlighting its reliance on the performance of Tencent in the broader technology market.

In the fiscal year ending March 2023, Prosus reported a revenue of $37.2 billion, showing a year-on-year increase of 10%. However, the company registered a net loss of approximately $9.4 billion, largely attributed to its significant write-downs in the valuation of its investments in various startups and tech companies, reflecting the broader volatility in the tech sector.

In addition to its Tencent investment, Prosus has pursued growth through acquisitions and partnerships. The company's portfolio includes high-growth platforms such as Delivery Hero, an online food delivery service, which saw revenues of approximately €6.7 billion in 2022. Furthermore, Prosus invested over $2 billion in fintech ventures globally, reflecting its ambition to capitalize on the rapidly growing digital payments market.

The stock performance of Prosus has mirrored the fluctuations in the tech industry. After its debut on the Amsterdam Stock Exchange, the share price peaked at around €120 in late 2021 but has experienced volatility since, trading at approximately €60 as of October 2023. This price decline has led to heightened discussions regarding the company's asset valuation strategies, particularly concerning its most significant investments.

Prosus N.V. has also taken steps to enhance its operational efficiencies, including implementing cost-cutting measures across several businesses. In its recent efforts, the company aims to achieve annual savings of around $1 billion by 2025. This restructuring is expected to improve profitability margins, which currently stand at around 5% for its food delivery business.

Overall, the history of Prosus N.V. is characterized by bold investments and strategic decision-making aimed at navigating the complexities of the global technology landscape. Its trajectory within the consumer internet sector continues to be shaped by external market conditions and internal operational strategies to maximize shareholder value.

A Who Owns Prosus N.V.

Prosus N.V., listed on the Euronext Amsterdam under the ticker symbol PRX, is a global consumer internet group and one of the largest technology investors in the world. As of the latest data from September 2023, Prosus is primarily owned by its parent company, Naspers Limited.

The ownership structure of Prosus is notable for its significant stake held by Naspers, which is a South African multinational. Naspers possesses 73.1% of Prosus's shares, translating to a considerable influence in decision-making as well as strategic direction.

Below is a table detailing the ownership distribution and key stakeholders in Prosus N.V.:

Prosus has diversified its investments over the years, with significant stakes in various technology firms globally, including a 29% stake in Tencent Holdings, a leading Chinese tech conglomerate. This investment alone has made a substantial contribution to Prosus's market valuation, with Tencent's share price influencing Prosus's performance considerably.

As per the financial results for the fiscal year ended March 31, 2023, Prosus reported a net profit of $2.75 billion, representing a 19% year-over-year increase. This growth has been attributed to rising revenue from its e-commerce platforms as well as its investment in technology companies.

Additionally, the company's market capitalization as of late September 2023 stands at approximately $112 billion. This figure highlights Prosus’s stature as a heavyweight in the tech investment space. The company has remained focused on growth areas such as online food delivery, e-commerce, and fintech, continuing to allocate resources toward these sectors.

Moreover, Prosus has maintained a strong balance sheet, with total assets reported at around $66.4 billion and equity totaling $38.1 billion as of the last fiscal year. This solid financial foundation provides Prosus with the flexibility to pursue further strategic acquisitions and investments.

In conclusion, the principal owner of Prosus N.V. is Naspers Limited, with significant ownership stakes from institutional and retail investors. As the company continues to navigate the dynamic technology landscape, its performance remains closely tied to its strategic investments and overall market trends.

Prosus N.V. Mission Statement

Prosus N.V., a global consumer internet group and one of the largest technology investors in the world, aims to improve the lives of people through technology. The company's mission statement focuses on empowering individuals and communities by leveraging technology to drive progress.

In alignment with their mission, Prosus emphasizes three core areas:

• Investment in technology companies that enhance daily living.
• Creating long-term value for stakeholders through strategic partnerships.
• Fostering innovation and entrepreneurship in emerging markets.

As of October 2023, Prosus N.V. has invested over USD 16 billion into various technology firms globally. This investment strategy highlights their commitment to growth sectors such as e-commerce, food delivery, and fintech.

In the fiscal year ending March 2023, Prosus reported total revenues of USD 6.8 billion, with a significant increase of 22% compared to the previous fiscal year. This growth is attributed to strong performance across their core businesses, which include:

Prosus also holds significant stakes in major technology companies, including:

• 51% stake in Tencent, valued at approximately USD 150 billion as of Q3 2023.
• Investments in food delivery companies such as Delivery Hero and Swiggy.
• Strategic partnerships with local firms to enhance market penetration in India and Southeast Asia.

Moreover, in their corporate social responsibility initiatives, Prosus N.V. has committed to investing USD 500 million in educational technology and training programs over the next five years, underscoring their mission to foster innovation and entrepreneurship.

Overall, the mission statement of Prosus N.V. reflects their commitment to leveraging technology not only to enhance their business operations but also to create meaningful social impact globally.

How Prosus N.V. Works

Prosus N.V. is a global consumer internet group and one of the largest technology investors in the world. It is based in Amsterdam and operates in various sectors including online classifieds, food delivery, and fintech. The company was spun off from Naspers Limited in 2019 and is now primarily focused on developing and investing in internet-based companies.

As of October 2023, Prosus holds a significant stake in several major companies, particularly in the e-commerce and online marketplace sectors. Its investment portfolio includes a variety of businesses across different regions, with notable holdings in Tencent, Delivery Hero, and various food delivery services.

Prosus reported a revenue of €30.4 billion for the fiscal year ending March 2023, showing a growth of 15% year-over-year. The company’s net profit for the same period was approximately €2 billion, reflecting a strong operational performance despite market fluctuations.

The breakdown of its revenue sources is as follows:

Prosus also reported an EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of approximately €4.5 billion, which indicates a solid operating margin of around 15%.

Prosus primarily invests through equity stakes in high-growth companies, often focusing on emerging markets. As of the latest financial disclosures, Prosus holds a 29% stake in Tencent, which has been a major contributor to its financial success. Tencent’s contribution to the overall revenue of Prosus was reported to be approximately €11 billion for the year.

In addition to Tencent, Prosus has diversified its portfolio across various sectors:

• Food Delivery: Through subsidiaries like iFood in Brazil and Swiggy in India, Prosus has expanded its footprint in the food delivery market.
• Fintech: The company has made significant investments in financial technology, including its partnerships with PayU, which processes payments in several regions.
• Online Education: Prosus has ventured into the edtech landscape with investments in platforms that cater to pre- and post-secondary education.

The stock performance of Prosus has been closely tied to the performance of its largest asset, Tencent. As of October 2023, the share price of Prosus was approximately €63 per share, showing a fluctuation range between €58 and €70 over the past year. The company has a market capitalization of around €107 billion.

The stock is also subject to various market dynamics: currency fluctuations, geopolitical risks, and changes in consumer behavior, particularly as it relates to its major holdings. Over the past 12 months, the stock has experienced a volatility measure of approximately 25%.

Prosus operates across numerous markets, with a significant presence in Asia, Europe, and Latin America. The company's operations are divided into several geographic segments, which generate diverse revenue streams:

With its strategic investments and diverse portfolio, Prosus is well-positioned to capitalize on emerging trends in the global digital landscape. The combination of robust financial performance, a solid investment strategy, and a strong market presence contributes to its continued growth within the technology sector.

How Prosus N.V. Makes Money

Prosus N.V. is a global consumer internet group and one of the largest technology investors in the world. The company has a diversified business model that generates revenue through various sectors including online marketplaces, food delivery, payments, and social media.

Revenue Streams

Prosus derives its revenue primarily through the following channels:

• Online Classifieds: Prosus owns multiple classified advertising platforms worldwide, including OLX, which operates in over 30 countries. In FY2023, the online classifieds segment generated approximately €1.7 billion in revenue.
• Food Delivery: The food delivery segment, including operations through Delivery Hero and Swiggy, contributed around €1.3 billion to Prosus' revenue in FY2023.
• Payments and Fintech: Prosus holds stakes in fintech companies like PayU. This segment registered a revenue of around €700 million in FY2023.
• EdTech: With investments in companies like Byju's and Eruditus, the EdTech sector has emerged as a key growth area, generating about €500 million in revenue in FY2023.
• Gaming: Through its subsidiary Tencent, Prosus generates substantial income from gaming, contributing approximately €2.5 billion in FY2023.

Financial Performance

In the financial year ending March 2023, Prosus reported the following key financial metrics:

Investment Strategy

Prosus employs a strategic investment approach, focusing on high-growth sectors. The company has major stakes in:

• Tencent Holdings: Prosus holds approximately 28.9% stake in Tencent, valued at approximately €117 billion as of October 2023.
• Delivery Hero: Prosus has invested over €5 billion in Delivery Hero, making it a significant player in the global food delivery market.
• Byju's: Prosus's investment in Byju's has amounted to around €1 billion, capitalizing on India’s booming EdTech sector.

Geographic Revenue Distribution

Prosus’s revenue is geographically diverse, with significant contributions from different regions:

In summary, Prosus N.V. has established a strong financial foundation through its multifaceted business model. The combination of strategic investments, diversified revenue streams, and a significant market presence positions Prosus as a key player in the global technology investment landscape.