GMO Payment Gateway (3769) Q3 2024 earnings summary

Executive summary

• Revenue and operating profit for Q3 FY2024 progressed in line with plans, with revenue up 15.3% YoY to ¥54.2bn and operating profit up 21.8% to ¥19.5bn.

• All business segments delivered double-digit revenue and profit growth YoY, driven by online payment, recurring revenue, and new business domains.

• Strategic focus on re-bundling, BaaS support, and global MSB expansion supports high growth trajectory.

• Gains on sale of investments accounted for using equity method contributed ¥1,624 million to pre-tax profit, boosting profit before income taxes by 37.1% YoY.

• Sustainability initiatives advanced, including SBTi certification and human capital investment.

Financial highlights

• Cumulative Q3 FY2024 revenue rose 15.3% YoY to ¥54.2bn; operating profit up 21.8% to ¥19.5bn.

• Gross profit increased 18.6% YoY to ¥35.3bn; EBITDA up 23.3% YoY.

• Net profit attributable to owners grew 35.5% YoY to ¥14.2bn; pre-tax profit up 37.1% YoY.

• Basic earnings per share for Q3 FY2024 was ¥187.87, up from ¥138.65 in Q3 FY2023.

• Cash and cash equivalents increased by ¥29.4bn during the quarter, reaching ¥163.1bn.

Outlook and guidance

• FY2024 revenue guidance at ¥73.3bn (74% achieved by Q3); operating profit guidance at ¥25bn (78.1% achieved).

• FY2024 profit attributable to owners forecast at ¥15.5bn (up 15.2% YoY).

• Targeting OP CAGR of 25% by expanding into new payment domains and scaling proprietary businesses.

• Management expects continued EC market growth, especially in B2C and non-merchandise domains, but notes potential headwinds from global economic uncertainty and inflation.

• Focus on monetizing large-scale projects, expanding B2B/B2E, and enhancing product scalability.