PayPay (PAYP) investor relations material

Executive summary

• Q2 revenue rose 27.7% YoY to ¥118.1bn; adjusted EBITDA increased 54.8% to ¥42.1bn, with a 36% margin.

• H1 revenue reached ¥227.9bn, up 28%, and adjusted EBITDA rose 57% to ¥79.5bn; stronger-than-expected first-half results drove higher FY guidance.

Financial highlights

• Q2 operating profit rose to ¥33.2bn from ¥20.5bn YoY; operating margin expanded to 28.1% from 22%.

• Total transaction costs rose 35.3% YoY to ¥28.1bn, reaching 23.8% of revenue versus 22.5%; higher funding and credit costs were key factors.

• Profit for the period was ¥18.4bn, down YoY due to the absence of a prior-year one-time tax benefit; excluding that benefit, profit increased.

• Revenue exceeded Q2 guidance and adjusted EBITDA beat it by ¥3.6bn, supported by revenue growth and controlled operating expenses.

Outlook and guidance

• FY guidance raised to ¥474–478bn revenue and ¥159–163bn adjusted EBITDA, from ¥465–473bn and ¥149–155bn, respectively.

• December 2026 quarter guidance is ¥121–123bn revenue and ¥41.5–43.5bn adjusted EBITDA.

• Q3 underlying growth trends are expected to remain broadly unchanged; deposit growth is expected to stay solid.

• Q4 adjusted EBITDA margin is expected below Q3, partly due to seasonal, promotional and tax-related costs, plus assumed further policy-rate hikes. Q3–Q4 take rates are expected to ease as Q2 one-off factors normalize.