FG Finam analyst Leonid Delitsyn spoke about the reasons for the company's

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Russian technology corporation VK has published financial results for nine months (from January to September) of 2023 and for the third quarter of 2023.

The company's revenue for the first nine months of 2023 amounted to RUB 90.3 billion. This is 37% more than for the same period in 2022. The main source of growth was revenue from online advertising, which increased by 47% year-on-year to RUB 55.4 billion. At the same time, VK's revenue for Q3 2023 increased by 37% malaysia whatsapp number database
compared to Q3 2022 and amounted to RUB 33 billion.

strong growth: "In Q3 2023, VK earned RUB 33 billion, which was 6% higher than my forecast of RUB 30.8 billion. The main driver of growth is still the recovering advertising market. The Association of Communications Agencies of Russia (ACAR) predicts that 2023 may be a record year and will exceed pre-COVID turnover. Very important news is the growth of VK's audience by 10%. It would seem that it has nowhere to grow, but favorable information for VK has appeared, that younger generations have begun to take an interest in the company's social networks."

79% of revenue for the first nine months of 2023 was accounted for by the company's key segment "Social networks and content services" and amounted to 71.3 billion rubles. Another 12% was accounted for by educational technologies (11.1 billion rubles), 5% by technologies for business (4.8 billion rubles), 4% by new business areas (3.1 billion rubles).

Revenue of the Social Networks and Content Services segment for Q3 2023 amounted to RUB 26.2 billion, compared to RUB 18.9 billion in Q3 2022. At the same time, the average monthly audience of VKontakte reached 85 million users, Odnoklassniki - 35.5 million, Zen - 31 million, and Mail.ru Mail - 49.5 million users.

The average daily number of views of the VK Video service in Q3 2023 reached 1.8 billion. VK Clips gained 949 million views, and the average monthly audience of VK Music was 43 million users.

In the Educational Technologies segment, revenue for Q3 2023 reached RUB 4.1 billion against RUB 2.6 billion in Q3 2022. The growth was 57.4%. The Business Technologies segment grew by 62.8% (RUB 1.8 billion against RUB 1.1 billion in Q3 2022). Here, the key growth drivers were the VK WorkSpace communication services and the VK Cloud platform cloud services.

Freedom Finance Global analyst Vladimir Chernov believes that VK's financial results are very strong: "The company's core segment's revenue growth rates remain double-digit, and the advertising market in Russia is recovering rapidly after a decline in 2022. The education segment and business technologies are showing such high revenue growth rates against the backdrop of the low base effect of 2022, and their growth prospects are still high."

Artem Tuzov, Director of the Corporate Finance Department at the investment company IVA Partners, noted that this is the company's first breakthrough quarter since its move to the Russian Federation: "Until Q3 2023, VK's financial results were not impressive. Now, investments made in attracting bloggers and audiences have yielded results, and it has become possible to magnetize traffic through advertising on the issuer's platforms. 80% of the company's revenue comes from social networks. Diversification in other areas cannot yet compete with the fact that VK owns virtually all of the most popular Russian social networks. Revenue from monetization of social networks will continue to grow, and by the end of 2023, it can be expected to be at the level of 120-130 billion rubles."

Vladimir Chernov gave a forecast for VK's revenue by the end of 2023 and suggested which segments could grow: "By the end of 2023, we expect the company's revenue to be around 125 billion rubles. In Q4 2023, we expect accelerated growth in revenue from online advertising and the "Technologies for Business" segment. Most likely, there will be high rates of revenue growth in percentage terms by the end of Q4 2023 in the "New Business Areas" segment against the background of the low base effect of 2022. There are already 33.7 million accounts registered on the VK Play platform, and the average monthly audience is 13.6 million users."