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Yandex Is Losing Market Share in Its Home Market

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Mar. 13 2019, Published 8:33 a.m. ET

Google is gaining ground

Yandex (YNDX) appears to be struggling to keep its lead in Russia’s Internet search engine market. The company’s share of the search engine market in Russia fell from 54% in January to 50% in February, data from StatCounter show. Over the same period, Google’s share of the search market in Russia jumped to 46% from 43%.

Mail.Ru and Verizon’s (VZ) Yahoo are also taking market share from Yandex. Mail.Ru’s share of the Russian search engine market rose to 2.6% in February from 2.3% in January. On its part, Yahoo’s share of Russia’s search engine market jumped to 0.39% in February from 0.32% in January.

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Yandex is building a diversified enterprise

Yandex’s weakening position in the search business comes at a time when the company has sought to diversify its operations with ventures into areas such as cloud computing, self-driving taxis, and hardware. Last year, Yandex launched a smart speaker device called Yandex.Station, following in the footsteps of its industry peers Google and Baidu (BIDU).

But Yandex has yet to make a mark in the smart speaker space. It didn’t feature among the world’s top five smart speaker companies in the latest market analysis report from Strategy Analytics, which ranked Amazon (AMZN) in first place with a 35.5% global market share and Google in second place with a 30% market share in the fourth quarter. Alibaba (BABA), Baidu, and Xiaomi captured 7.5%, 5.7%, and 4.6% of the global smart speaker market, respectively, in the quarter.

Leading growth rate

Despite its struggles to defend its search market share in its domestic market and its insignificant stake in the global smart speaker market, Yandex emerged as the fastest-growing major search engine company in the fourth quarter. The company’s fourth-quarter revenue rose 39% YoY (year-over-year) to $559.1 million, outpacing the 22% YoY revenue rises at both Alphabet (GOOGL) and Baidu in the same period.

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