Yandex N.V. (Form: 6-K, Received: 08/17/2023 15:50:22)

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

August 17, 2023

YANDEX N.V.

Schiphol Boulevard 165

1118 BG, Schiphol, the Netherlands.

Tel: +31 202 066 970

(Address, Including ZIP Code, and Telephone Number,

Including Area Code, of Registrant’s Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ⌧ Form 40-F ◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ◻

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ◻

EXPLANATORY NOTE

Filed as Exhibit 99.1 to this Report on Form 6-K is a copy of the unaudited condensed consolidated financial statements of Yandex N.V. as of and for the three and six months ended June 30, 2023.

INCORPORATION BY REFERENCE

Exhibit 99.1 to this Report on Form 6-K shall be deemed to be incorporated by reference into the registration statements on Form S-8 (Nos. 333-177622 and 333-213317) and Form F-3ASR (No. 333-239391) of Yandex N.V. (including any prospectuses forming a part of such registration statements) and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	YANDEX N.V.


Date: August 17, 2023	By:	/s/ Alexander Balakhnin
		Alexander Balakhnin
		Chief Financial Officer

INDEX TO EXHIBITS

Exhibit No.

Description

99.1

Unaudited Condensed Consolidated Financial Statements of Yandex N.V. as of and for the three and six months ended June 30, 2023

EXHIBIT 99.1

YANDEX N.V.

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


	Page
Unaudited Condensed Consolidated Balance Sheets as of December 31, 2022 and June 30, 2023	F-2
Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2022 and 2023	F-3
Unaudited Condensed Consolidated Statements of Comprehensive Income/(Loss) for the Three and Six Months Ended June 30, 2022 and 2023	F-4
Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2023	F-5
Unaudited Condensed Consolidated Statements of Shareholders’ Equity for the Three and Six Months Ended June 30, 2022 and 2023	F-7
Notes to the Unaudited Condensed Consolidated Financial Statements	F-9

F-1

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions of Russian rubles (“RUB”) and U.S. dollars (“$”), except share and per share data)


		As of
	Notes	December 31, 2022*	June 30, 2023	June 30, 2023
		RUB	RUB	$
ASSETS
Cash and cash equivalents	4	83,131	71,885	825.9
Trade accounts receivable, less allowance for doubtful accounts of RUB 4,169 and RUB 5,279, respectively	4	58,014	64,928	746.0
Sales financing receivable		5,738	5,720	65.7
Prepaid expenses		16,968	20,277	233.0
Inventory		28,220	23,519	270.2
Funds receivable		8,290	6,220	71.5
VAT reclaimable		22,602	24,829	285.3
Other current assets	4	16,971	20,750	238.4
Total current assets		239,934	238,128	2,736.0
Property and equipment	6	127,706	147,415	1,693.8
Operating lease right-of-use assets	7	28,646	28,847	331.4
Intangible assets	8	31,766	36,227	416.2
Content assets	10	16,844	18,856	216.7
Goodwill	8	143,778	142,784	1,640.6
Equity method investments		2,118	2,518	28.9
Investments in non-marketable equity securities		6,746	8,362	96.1
Deferred tax assets		3,904	6,436	73.9
Other non-current assets	4	15,277	22,402	257.4
Total non-current assets		376,785	413,847	4,755.0
TOTAL ASSETS		616,719	651,975	7,491.0
LIABILITIES AND SHAREHOLDERS’ EQUITY
Accounts payable, accrued and other liabilities	4	122,816	139,970	1,608.2
Debt, current portion	12	21,306	68,764	790.1
Income and non-income taxes payable	4	28,137	31,124	357.6
Deferred revenue		15,585	18,482	212.4
Total current liabilities		187,844	258,340	2,968.3
Debt, non-current portion	12	29,885	23,883	274.4
Deferred tax liabilities		5,473	7,222	83.0
Operating lease liabilities	7	17,609	17,391	199.8
Finance lease liabilities	7	21,185	25,201	289.6
Other accrued liabilities		16,545	24,772	284.6
Total non-current liabilities		90,697	98,469	1,131.4
Total liabilities		278,541	356,809	4,099.7
Commitments and contingencies	10,11
Shareholders’ equity:
Priority share: €1 par value; 1 share authorized, issued and outstanding		—	—	—
Ordinary shares: par value (Class A €0.01, Class B €0.10 and Class C €0.09); shares authorized (Class A: 500,000,000, Class B: 37,138,658 and Class C: 37,748,658); shares issued (Class A: 326,342,270, Class B: 35,698,674, and Class C: 10,000 and nil, respectively); shares outstanding (Class A: 325,783,607, Class B: 35,698,674 and Class C: nil)		282	282	3.2
Treasury shares at cost (Class A: 558,663)		(1,393)	(1,393)	(16.0)
Additional paid-in capital		119,464	81,505	936.5
Accumulated other comprehensive income		24,258	22,550	259.1
Retained earnings		173,697	192,206	2,208.4
Total equity attributable to Yandex N.V.		316,308	295,150	3,391.2
Noncontrolling interests		21,870	16	0.1
Total shareholders’ equity		338,178	295,166	3,391.3
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		616,719	651,975	7,491.0

* Derived from audited consolidated financial statements

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-2

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions of Russian rubles and U.S. dollars, except share and per share data)


		Three months ended June 30,			Six months ended June 30,
	Notes	2022	2023	2023	2022	2023	2022
		RUB	RUB	$	RUB	RUB	$
Revenues	4	117,748	182,495	2,096.8	223,758	345,770	3,972.8
Operating costs and expenses:
Cost of revenues⁽¹⁾		48,721	79,120	909.1	99,732	156,659	1,800.0
Product development⁽¹⁾		16,826	23,911	274.7	35,987	46,215	531.0
Sales, general and administrative⁽¹⁾		35,742	57,498	660.6	76,547	110,673	1,271.5
Depreciation and amortization		7,713	9,336	107.3	15,180	17,623	202.5
Goodwill impairment	8	—	1,136	13.1	—	1,136	13.1
Total operating costs and expenses		109,002	171,001	1,964.8	227,446	332,306	3,818.1
Income/(loss) from operations		8,746	11,494	132.0	(3,688)	13,464	154.7
Interest income		1,037	1,108	12.7	2,399	2,323	26.7
Interest expense		(1,109)	(1,973)	(22.7)	(1,729)	(3,146)	(36.1)
Gain on restructuring of convertible debt		9,305	—	—	9,305	—	—
Loss from equity method investments		(86)	(109)	(1.3)	(451)	(241)	(2.8)
Other income/(loss), net	4	(6,105)	9,020	103.8	(4,567)	14,877	170.9
Net income before income taxes		11,788	19,540	224.5	1,269	27,277	313.4
Income tax expense	9	3,732	4,909	56.4	6,250	6,861	78.8
Net income/(loss)		8,056	14,631	168.1	(4,981)	20,416	234.6
Net income attributable to noncontrolling interests		(2,290)	(402)	(4.6)	(3,676)	(1,905)	(21.9)
Net income/(loss) attributable to Yandex N.V.		5,766	14,229	163.5	(8,657)	18,511	212.7
Net income/(loss) per Class A and Class B share:
Basic	2	15.54	38.37	0.44	(23.53)	49.92	0.57
Diluted	2	(7.03)	38.23	0.44	(45.86)	49.74	0.57
Weighted average number of Class A and Class B shares used in per share computation
Basic	2	371,106,744	370,823,163	370,823,163	367,856,773	370,839,366	370,839,366
Diluted	2	376,105,159	372,224,647	372,224,647	370,832,165	372,169,479	372,169,479

(1)	These balances exclude depreciation and amortization expenses, which are presented separately, and include share-based compensation expenses of:


Cost of revenues	129	177	2.0	280	341	3.9
Product development	3,926	3,188	36.6	7,466	6,469	74.3
Sales, general and administrative	2,440	2,134	24.6	5,014	4,489	51.6

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-3

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)

(In millions of Russian rubles and U.S. dollars)


	Three months ended June 30,			Six months ended June 30,
	2022	2023	2023	2022	2023	2023
	RUB	RUB	$	RUB	RUB	$
Net income/(loss)	8,056	14,631	168.1	(4,981)	20,416	234.6
Foreign currency translation, net of tax of nil	12,662	(2,254)	(25.9)	6,853	(3,394)	(39.0)
Total comprehensive income	20,718	12,377	142.2	1,872	17,022	195.6
Total comprehensive income attributable to noncontrolling interests	(2,061)	(351)	(4.1)	(3,418)	(1,865)	(21.4)
Total comprehensive income/(loss) attributable to Yandex N.V.	18,657	12,026	138.1	(1,546)	15,157	174.2

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-4

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions of Russian rubles and U.S. dollars)


		Six months ended June 30,
	Notes	2022	2023	2023
		RUB	RUB	$
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net income/(loss)		(4,981)	20,416	234.6
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Depreciation of property and equipment	6	11,649	12,922	148.5
Amortization of intangible assets	8	3,531	4,701	54.0
Amortization of content assets	10	4,626	4,540	52.2
Operating lease right-of-use assets amortization and the lease liability accretion	7	7,711	6,794	78.1
Amortization of debt discount and issuance costs		585	—	—
Share-based compensation expense (excluding cash settled awards of RUB 9,208 and RUB 8,319, respectively)		3,552	2,980	34.2
Deferred income tax expense/(benefit)		315	(377)	(4.3)
Foreign exchange losses/(gains)	4	4,231	(14,878)	(170.9)
Loss from equity method investments		451	241	2.8
Gain on restructuring of convertible debt		(9,305)	—	—
Impairment of long-lived assets		3,644	1,199	13.8
Provision for expected credit losses		1,038	2,263	26.0
Other		481	806	9.2
Changes in operating assets and liabilities excluding the effect of acquisitions:
Accounts receivable		4,540	(6,999)	(80.4)
Prepaid expenses		(2,395)	(1,722)	(19.9)
Inventory		(6,065)	4,260	48.9
Accounts payable, accrued and other liabilities and non-income taxes payable	4	(1,108)	5,223	59.9
Deferred revenue		694	2,554	29.3
Other assets		(194)	(2,853)	(32.8)
VAT reclaimable		165	(956)	(11.0)
Funds receivable		949	2,413	27.7
Sales financing receivable		(735)	(977)	(11.2)
Content assets	10	(6,199)	(6,424)	(73.8)
Content liabilities		(353)	(57)	(0.7)
Net cash provided by operating activities		16,827	36,069	414.2
CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES:
Purchases of property and equipment and intangible assets		(25,687)	(25,169)	(289.2)
Purchase of assets to be leased		—	(8,589)	(98.7)
Acquisitions of businesses, net of cash acquired		(820)	—	—
Proceeds from sale of marketable equity securities		5,859	—	—
Investments in term deposits		(2,000)	(6)	(0.1)
Maturities of term deposits		25,769	160	1.8
Loans granted		(25)	(997)	(11.4)
Proceeds from repayments of loans		480	1,198	13.8
Other investing activities		(106)	181	2.1
Net cash provided by/(used in) investing activities		3,470	(33,222)	(381.7)

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-5

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(In millions of Russian rubles and U.S. dollars)


		Six months ended June 30,
	Notes	2022	2023	2023
		RUB	RUB	$
CASH FLOWS USED IN FINANCING ACTIVITIES:
Proceeds from issuance of debt	12	46,781	81,681	938.5
Repayment of debt	12	(45,832)	(40,335)	(463.4)
Repayments of overdraft borrowings		(2,940)	—	—
Purchase of non-redeemable noncontrolling interests	3	—	(57,337)	(658.8)
Payment of contingent consideration and holdback amount		(69)	(77)	(0.9)
Payment for finance leases		(719)	(1,455)	(16.7)
Other financing activities		(1,156)	(5,674)	(65.1)
Net cash used in financing activities		(3,935)	(23,197)	(266.4)
Effect of exchange rate changes on cash and cash equivalents, and restricted cash and cash equivalents		(19,893)	8,531	98.2
Net change in cash and cash equivalents, and restricted cash and cash equivalents		(3,531)	(11,819)	(135.7)
Cash and cash equivalents, and restricted cash and cash equivalents, beginning of period		79,398	84,441	970.1
Cash and cash equivalents, and restricted cash and cash equivalents, end of period		75,867	72,622	834.4

RECONCILIATION OF CASH AND CASH EQUIVALENTS, AND RESTRICTED CASH AND CASH EQUIVALENTS:
Cash and cash equivalents, beginning of period		79,274	83,132	955.2
Restricted cash and cash equivalents, beginning of period		124	1,309	14.9
Cash and cash equivalents, and restricted cash and cash equivalents, beginning of period		79,398	84,441	970.1
Cash and cash equivalents, end of period		75,592	71,885	825.9
Restricted cash and cash equivalents, end of period		275	737	8.5
Cash and cash equivalents, and restricted cash and cash equivalents, end of period		75,867	72,622	834.4

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income taxes		5,990	9,659	111.0
Cash paid for acquisitions		1,031	—	—
Convertible notes coupon paid		439	—	—
Interest paid for finance leases		561	1,220	14.0
Interest paid on loans		87	1,915	22.0
Operating cash flows from operating leases		6,375	7,168	82.4
Non-cash operating activities:
Increase of right-of-use assets due to new operating lease and lease modification		3,217	5,719	65.7
Non-cash investing activities:
Acquired property and equipment and intangible assets not yet paid for		2,733	11,826	135.9
Non-cash financing activities:
Increase of right-of-use assets due to new finance lease and lease modification		1,322	6,446	74.1

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.

F-6

Table of Contents

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions of Russian rubles and U.S. dollars, except share and per share data)


	Three months ended June 30, 2022
	Priority Share		Ordinary Shares				Accumulated				Redeemable
	Issued and		Issued and		Treasury	Additional	Other		Non-		non-
	Outstanding		Outstanding		shares at	Paid-In	Comprehensive	Retained	controlling		controlling
	Shares	Amount	Shares	Amount	cost	Capital	Income	Earnings	interests	Total	interests
		RUB		RUB	RUB	RUB	RUB	RUB	RUB	RUB	RUB
Balance as of March 31, 2022	1	—	358,940,490	281	(1,393)	105,600	10,413	119,486	15,317	249,704	435
Share-based compensation expense	—	—	—	—	—	1,010	—	—	—	1,010	—
Restructuring of convertible debt	—	—	—	—	—	9,941	—	—	—	9,941	—
Repurchase of share options	—	—	—	—	—	(58)	—	(12)	—	(70)	(44)
Foreign currency translation adjustment	—	—	—	—	—	—	12,891	—	(229)	12,662	—
Change in redemption value of redeemable noncontrolling interests	—	—	—	—	—	—	—	53	—	53	(53)
Net income	—	—	—	—	—	—	—	5,766	2,290	8,056	—
Other	—	—	—	—	—	141	—	—	(141)	—	—
Balance as of June 30, 2022	1	—	358,940,490	281	(1,393)	116,634	23,304	125,293	17,237	281,356	338


	Three months ended June 30, 2023
	Priority Share		Ordinary Shares				Accumulated
	Issued and		Issued and		Treasury	Additional	Other		Non-
	Outstanding		Outstanding		shares at	Paid-In	Comprehensive	Retained	controlling
	Shares	Amount	Shares	Amount	cost	Capital	Income	Earnings	interests	Total
		RUB		RUB	RUB	RUB	RUB	RUB	RUB	RUB
Balance as of March 31, 2023	1	—	361,482,281	282	(1,393)	120,171	23,107	177,977	23,384	343,528
Share-based compensation expense	—	—	—	—	—	2,273	—	—	—	2,273
Transaction with Uber (Note 3)	—	—	—	—	—	(35,459)	1,646	—	(23,524)	(57,337)
Foreign currency translation adjustment	—	—	—	—	—	—	(2,203)	—	(51)	(2,254)
Net income	—	—	—	—	—	—	—	14,229	402	14,631
Other	—	—	—	—	—	(5,480)	—	—	(195)	(5,675)
Balance as of June 30, 2023	1	—	361,482,281	282	(1,393)	81,505	22,550	192,206	16	295,166
Balance as of June 30, 2023, $		—		3.2	(16.0)	936.5	259.1	2,208.4	0.1	3,391.3

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements

F-7

YANDEX N.V.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions of Russian rubles and U.S. dollars, except share and per share data)


	Six months ended June 30, 2022
	Priority Share		Ordinary Shares				Accumulated				Redeemable
	Issued and		Issued and		Treasury	Additional	Other		Non-		non-
	Outstanding		Outstanding		shares at	Paid-In	Comprehensive	Retained	controlling		controlling
	Shares	Amount	Shares	Amount	cost	Capital	Income	Earnings	interests	Total	interests
		RUB		RUB	RUB	RUB	RUB	RUB	RUB	RUB	RUB
Balance as of December 31, 2021	1	—	358,703,352	281	(2,728)	112,942	16,193	131,488	13,880	272,056	869
Effect of adoption of ASU 2020-06	—	—	—	—	—	(8,573)	—	2,511	—	(6,062)	—
Adjusted balance as of January 1, 2022	1	—	358,703,352	281	(2,728)	104,369	16,193	133,999	13,880	265,994	869
Share-based compensation expense	—	—	—	—	—	3,627	—	—	—	3,627	—
Exercise of share options	—	—	237,138	—	—	—	—	—	—	—	—
Tax withholding related to exercise of share awards	—	—	—	—	—	(25)	—	—	—	(25)	—
Reissue of shares for options exercised	—	—	—	—	1,335	(1,335)	—	—	—	—	—
Restructuring of convertible debt	—	—	—	—	—	9,941	—	—	—	9,941	—
Repurchase of share options	—	—	—	—	—	(5)	—	(105)	—	(110)	(474)
Change in redemption value of redeemable noncontrolling interests	—	—	—	—	—	—	—	57	—	57	(57)
Foreign currency translation adjustment	—	—	—	—	—	—	7,111	—	(258)	6,853	—
Net (loss)/income	—	—	—	—	—	—	—	(8,657)	3,676	(4,981)	—
Other	—	—	—	—	—	62	—	(1)	(61)	—	—
Balance as of June 30, 2022	1	—	358,940,490	281	(1,393)	116,634	23,304	125,293	17,237	281,356	338


	Six months ended June 30, 2023
	Priority Share		Ordinary Shares				Accumulated
	Issued and		Issued and		Treasury	Additional	Other		Non-
	Outstanding		Outstanding		shares at	Paid-In	Comprehensive	Retained	controlling
	Shares	Amount	Shares	Amount	cost	Capital	Income	Earnings	interests	Total
		RUB		RUB	RUB	RUB	RUB	RUB	RUB	RUB
Balance as of December 31, 2022	1	—	361,482,281	282	(1,393)	119,464	24,258	173,697	21,870	338,178
Share-based compensation expense	—	—	—	—	—	2,980	—	—	—	2,980
Transaction with Uber (Note 3)	—	—	—	—	—	(35,459)	1,646	—	(23,524)	(57,337)
Foreign currency translation adjustment	—	—	—	—	—	—	(3,354)	—	(40)	(3,394)
Net income	—	—	—	—	—	—	—	18,511	1,905	20,416
Other	—	—	—	—	—	(5,480)	—	(2)	(195)	(5,677)
Balance as of June 30, 2023	1	—	361,482,281	282	(1,393)	81,505	22,550	192,206	16	295,166
Balance as of June 30, 2023, $		—		3.2	(16.0)	936.5	259.1	2,208.4	0.1	3,391.3

The accompanying notes are an integral part of the unaudited condensed consolidated financial statements

F-8

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YANDEX N.V.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(In millions of Russian rubles and U.S. dollars, except share and per share data)

DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Yandex N.V., the parent company (the “Company”), together with its consolidated subsidiaries (collectively “Yandex” or the “Group”), is a technology company that builds intelligent products and services powered by machine learning and other technologies. Yandex is one of Europe's largest internet businesses and the leading search and ride-hailing provider in Russia.

Yandex N.V. was incorporated under the laws of the Netherlands in June 2004 and is the holding company of a number of subsidiaries globally.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by U.S. GAAP for annual financial statements. As such, the information included in these unaudited condensed consolidated financial statements for the three and six months ended June 30, 2023 should be read in conjunction with the consolidated financial statements and the notes thereto included in the Annual Report on Form 20-F for the year ended December 31, 2022.

In the opinion of the Group, the accompanying unaudited condensed financial statements contain all adjustments, which are of a normal recurring nature, necessary for a fair statement of its financial position as of
June 30, 2023, and its results of operations, comprehensive income/(loss), cash flows and change in equity for the periods presented. The condensed consolidated balance sheet as of December 31, 2022, was derived from the consolidated financial statements included in the Annual Report on Form 20-F for the year ended December 31, 2022.

The results for the three and six months ended June 30, 2023 are not necessarily indicative of the operating results expected for the year ending December 31, 2023 or any other future period. The potential risks and uncertainties that could cause actual results to differ from the operating results expected include, among others, geopolitical and macroeconomic developments affecting the Russian economy or the Group’s business, operations or governance; changes in the political, legal and/or regulatory environment; competitive pressures; changes in advertising patterns; changes in user preferences; technological developments; and the Group’s need to expend capital to accommodate the growth of the business in addition to other risks and uncertainties included under “Risk Factors” in the Group’s Annual Report on Form 20-F for the year ended December 31, 2022.

There have been no material changes in the Group’s significant accounting policies and estimates as compared to those described in the Group’s Annual Report on Form 20-F for the year ended December 31, 2022, except for an update of accounting policy in relation to the net investment in the lease.

Investment in the finance lease consists of sales-type leases of cars and represents net unpaid rentals. The terms of the sales-type leases are from 3 to 5 years, with the possibility of early redemption and secured by a collateral of the leased assets. The Group recognizes net investment in the lease and derecognizes the assets to be leased. Net investment in the lease is calculated as the aggregate of minimum lease payments net of reimbursable expenses, representing the amounts guaranteed by the lessee and any unguaranteed residual value (together - gross investment in the lease), discounted at the interest rate implicit in the lease. The interest rate implicit in the lease is the discount rate that, at the inception of the lease, causes the present value of the gross investment in the lease to be equal to the fair value of the leased assets. The difference between the gross investment in the lease and the net investment in the lease represents unearned finance income. Unearned finance income is recognized as finance lease income over the lease term in a manner that produces a constant rate of return on the net investment in the lease based on the implicit interest rate.

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and amounts of revenues and expenses for the reporting

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NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(In millions of Russian rubles and U.S. dollars, except share and per share data)

period. The Group bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Convenience Translation

Translations of amounts from RUB into U.S. dollars for the convenience of the reader have been made at the exchange rate of RUB 87.0341 to $1.00, the exchange rate as of June 30, 2023 (except as otherwise stated). No representation is made that the RUB amounts could have been, or could be, converted into U.S. dollars at such rate. After the balance sheet date, the ruble has been experiencing a period of significant volatility.

Recently Adopted Accounting Pronouncements

In September 2022, the FASB issued ASU No. 2022-04, “Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations”, which requires entities that use supplier finance programs in connection with the purchase of goods and services to disclose key terms of the programs. The standard does not affect the recognition, measurement or financial statement presentation of supplier finance program obligations. The amendments in this ASU are effective for reporting periods beginning after December 15, 2022, except for the amendment on rollforward information, which is effective for periods beginning after December 15, 2023. The Group adopted the standard effective on January 1, 2023, without a significant impact on the unaudited condensed consolidated financial statements.

NET INCOME/(LOSS) PER SHARE

Basic net income/(loss) per Class A and Class B ordinary share for the three and six months ended June 30, 2022 and 2023 is computed on the basis of the weighted average number of ordinary shares outstanding using the two class method. Basic net income/(loss) per share is computed using the weighted average number of ordinary shares outstanding during the period and including vested restricted share units and shares that will be delivered as part of the restructuring of the convertible debt in June 2022. Diluted net income/(loss) per ordinary share is computed using the dilutive effect of share-based awards calculated using the “treasury stock” method and the dilutive effect of convertible debt restructuring under the if-converted method.

The computation of the diluted net income/(loss) per Class A share assumes the conversion of Class B shares, while the diluted net income/(loss) per Class B share does not assume the conversion of those shares. The net income/(loss) per share amounts are the same for Class A and Class B shares because the holders of each class are legally entitled to equal per share distributions whether through dividends or in liquidation. The number of share-based awards excluded from the diluted net income/(loss) per ordinary share computation, because their effect was anti-dilutive for the three months ended June 30, 2022 and 2023, was 15,105,542 and 5,606,909, respectively and for the six months ended June 30, 2022 and 2023, was 18,459,412 and 5,610,944, respectively.

In June 2022, the Group completed a purchase of 93.2% in aggregate principal amount of the Group’s 0.75% convertible notes due to March 3, 2025 (the “Notes”) and accounted for the modification of all the Notes. The Group has to date purchased more than 99% in aggregate principal amount of the Notes originally issued. Prior to the modification, the convertible debt is included in the calculation of diluted net income per share under the if-converted method.

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YANDEX N.V.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(In millions of Russian rubles and U.S. dollars, except share and per share data)

The components of basic and diluted net income/(loss) per share were as follows:


	Three Months ended June 30,
	2022		2023
	Class A	Class B	Class A	Class A	Class B	Class B
	RUB	RUB	RUB	$	RUB	$
Net income, allocated for basic	5,211	555	12,859	147.8	1,370	15.7
Reallocation of net income as a result of conversion of Class B to Class A shares	555	—	1,370	15.7	—	—
Reallocation of net loss to Class B shares	—	(806)	—	—	(5)	—
Effect of convertible debt restructuring, net of tax	(8,405)	—	—	—	—	—
Dilution in Classifieds	(3)	—	—	—	—	—
Net (loss)/income, allocated for diluted	(2,642)	(251)	14,229	163.5	1,365	15.7
Weighted average ordinary shares used in per share computation— basic	335,408,070	35,698,674	335,124,489	335,124,489	35,698,674	35,698,674
Effect of:
Conversion of Class B to Class A shares	35,698,674	—	35,698,674	35,698,674	—	—
Incremental shares under the if-converted method	4,998,415	—	—	—	—	—
Share-Based Awards	—