freee K.K. (4478) Q3 2025 earnings summary

Executive summary

• Net sales for the nine months ended March 31, 2025 rose 29.5% YoY to ¥23,850 million, driven by growth in the Platform business and SaaS customer base expansion.

• Achieved strong customer growth, surpassing 400K in self-employed and 620K total paying customers, with robust acquisition during tax season.

• Adjusted operating profit reached ¥2,116 million, reversing a loss of ¥6,307 million in the prior year period.

• ARR for the Platform business increased 29.0% YoY to ¥33,250 million, with paying customers up 14.9% and ARPU up 12.2%.

• New product launches and a subsidiary for business loan consulting contributed to business expansion.

Financial highlights

• Gross profit for the nine months was ¥19,740 million, up from ¥15,154 million year-over-year.

• Adjusted operating profit for Q3 was JPY 659MM, maintaining profitability despite seasonal marketing spend.

• Subscription revenue accounted for over 90% of total revenue for the nine months.

• Adjusted operating profit margin improved by 37.3pts YoY to 7.7%.

• Comprehensive income reached ¥983 million, reversing a loss of ¥8,725 million in the previous year.

Outlook and guidance

• Fiscal year ending June 30, 2025 net sales forecast is ¥33,060 million, up 30.0% YoY.

• Adjusted operating profit guidance revised upward to ¥1,800–2,500 million, with a margin of 5.4%–7.6%.

• Q4 adjusted operating profit expected to be around break-even due to investments for next fiscal year.

• Targeting break-even in adjusted free cash flow for FY2025.6, with positive FCF expected in H2.

• Long-term targets: revenue over JPY 50Bn and net revenue retention rate of 110%+ for corporates by FY2027.6.