In theory, all is well at Yandex, the European web giant, which is sometimes nicknamed the Russian Google. The technology company also posted a turnover up 46% in the third quarter of 2022, boosted by the good shape of activities related to its search engine and e-commerce. However, the company wants to restructure in depth.
Yandex is suffocated by Western sanctions
On closer inspection, the invasion of Ukraine and the ensuing Western sanctions have hurt the company very badly. Even before the outbreak of the war, its shares had fallen by 62% on the Nasdaq in New York, or more than 20 billion dollars in capitalization, and its listing has been suspended since last February.
Activities such as self-driving cars, machine learning, or the cloud are now unviable for Yandex due to sanctions. The Tech giant is no longer able to access Western technologies, nor to secure the services of experts in these different fields.
To get out of this, the parent company of the company, whose headquarters are in the Netherlands, would like to cut its ties with Russia. The idea would therefore be to transfer these cutting-edge domains to external markets, and thus escape the sanctions of the United States and the European Union. At the same time, the activities established in the country, including the search engine, would be sold.
To implement this strategy, the leaders of Yandex will however have to convince Vladimir Putin. And nothing is gained, because the Russian leader is very attached to the idea of technological sovereignty, and he will probably not see a good eye to see these activities transferred abroad.
Russian Tech is exhausted by the War in Ukraine
According to New York Times, Yandex can, however, count on the support of Aleksei Kudrin, an adviser to the president, who is currently acting informally on behalf of the company. In the future, the latter could occupy a position of responsibility to make the link between the company and the Kremlin.
The future will tell if this plan is carried out. Either way, the war in Ukraine is putting the Russian Tech sector in trouble. According to a report by the Russian Electronic Communications Association published shortly after the start of the conflict, between 50,000 and 70,000 new technology workers fled the country. This figure has probably increased significantly since the announcement of the partial mobilization by Vladimir Putin last September.