Rakuten Group (4755) Q4 2024 earnings summary

Executive summary

• Achieved consolidated annual profit for the first time since 2019, driven by significant improvements in Mobile, robust Internet Services and FinTech growth, and cost efficiencies.

• Consolidated revenue reached JPY 2.3 trillion, up 10.0% year-over-year, marking 28 consecutive years of revenue growth.

• IFRS operating income turned positive at JPY 53.0bn after five years of losses; non-GAAP operating income was JPY 7.0bn, a turnaround from a loss of JPY 153.0bn.

• Net loss attributable to owners narrowed to JPY 162.4bn, a JPY 177.0bn improvement year-over-year.

• EBITDA more than doubled to JPY 326.0bn, up 120% year-over-year.

Financial highlights

• Total assets rose to JPY 26.5tn, up JPY 3.9tn from the previous year, driven by increases in financial assets, cash, loans, and investment securities.

• Cash and cash equivalents at year-end were JPY 6.2tn, up JPY 1.0tn year-over-year.

• Rakuten Mobile contributed 34.4% of consolidated revenue growth, with revenue up 38.0% year-over-year and ARPU up 40.3% to JPY 2,856.

• FinTech segment revenue grew 13.1% year-over-year to JPY 820.4bn, with non-GAAP OI up 37.9% to JPY 153.4bn.

• Internet Services segment revenue rose 5.8% year-over-year to JPY 1.3tn, with non-GAAP OI up 29.8% to JPY 85.1bn.

Outlook and guidance

• Double-digit consolidated revenue growth is targeted for FY2025, excluding the securities business.

• Non-GAAP operating income is expected to remain profitable in FY2025.

• Capex for 2025 is planned at JPY 150bn, focused on network quality improvements and Platinum Band utilization.

• Non-FinTech net interest-bearing debt/EBITDA targeted to be within 5x by FY2027.

• Internet Services and FinTech aim for further growth via customer acquisition, cross-use, and AI-driven initiatives.