August 10, 2022
  • Rakuten Group, Inc.

Rakuten Group Q2 FY2022 Financial Results Highlights

Overall Performance

・ The Rakuten Group recorded revenue growth in all three segments in Q2 FY2022: Internet Services, FinTech and Mobile. Consolidated revenue achieved double-digit growth, up 13.5% year-on-year (YoY), coming to a total of 456.5 billion yen. In addition to the growth in domestic e-commerce*1 transaction value due to both sustained user retention since the impact over two years ago of COVID-driven stay-at-home consumption and the recovery in domestic travel demand, the customer base expansion in Rakuten’s fintech services also contributed to the revenue increase.

・ In Q2 FY2022, the average number of monthly active users*2 across the Rakuten Group in Japan surpassed 37 million, up 11.3% YoY. Cross-use*3 also expanded steadily (74.7%) and the Rakuten Ecosystem’s customer base continues to grow.

・ Due to ongoing strategic investment in future growth for the Mobile segment, including the installation of network base stations, the Rakuten Group recorded Non-GAAP operating losses of 79.1 billion yen in Q2 FY2022. Excluding the Mobile business, Non-GAAP operating income was 45.2 billion yen (up 12.6% YoY). As forecast, Mobile segment losses peaked in Q1 FY2022 and gradually began to decrease in Q2. Going forward, losses are expected to continue to gradually decrease.

Internet Services segment

Revenue for the Internet Services segment was 260.0 billion yen, up 9.8% YoY, in Q2 FY2022, while Non-GAAP operating income was 21.5 billion yen, up 32.7% YoY.

・ Domestic e-commerce gross merchandise sales (GMS) exceeded 1.3 trillion yen, up 12.3% YoY. In particular, Rakuten Ichiba monthly GMS in June 2022 increased by 72.5% compared to pre-pandemic January 2020, and by 80.0% for Rakuten Seiyu Netsuper. Rakuten Travel’s gross transaction value (GTV) increased by 14.0% compared to pre-pandemic Q2 FY2019, outperforming the market and boosted by a recovery in domestic travel demand. This also contributed significantly to revenue growth.

・ In overseas businesses, due to marketing measures and recovery in consumer behavior, revenue for U.S.A.-based cashback service Rakuten Rewards was 23.1 billion yen (up 18.2% YoY) in Q2 FY2022, with revenue growing steadily. Additionally, the customer bases for Rakuten’s content businesses grew significantly over the previous year*4. In particular, Rakuten TV’s total registered users increased to 58.6 million (up 63.9% YoY), Rakuten Viki’s total registered users increased to 59.6 million (up 32.6% YoY) and Rakuten Viber’s total registered users increased to 1.38 billion (up 7.2% YoY).

FinTech segment

In Q2 FY2022, the FinTech segment recorded increases in both revenue and profit. Revenue was 162.7 billion yen, up 6.3% YoY, and segment profit was 26.5 billion yen, an increase of 17.4% YoY.

Rakuten Card has issued a cumulative total of 26.69 million cards (as of the end of June 2022), and reached a shopping gross transaction value (GTV) of 4.5 trillion yen (up 28.8% YoY) in Q2 FY2022. The growth in shopping GTV was powered by continued customer base expansion and a recovery trend in offline consumption, boosted by the easing in March 2022 of COVID-19 restrictions.

As of the end of June 2022, Rakuten Bank had 12.68 million non-consolidated customer accounts, and its total balance of deposits (non-consolidated) was 8.1 trillion yen. In April 2022, as part of its mid to long-term business plan, Rakuten Bank set targets of 25 million customer accounts and 20 trillion yen in total balance of deposits (non-consolidated) by March 2027. Rakuten Bank applied for listing on the Tokyo Stock Exchange in July.

As of the end of June 2022, Rakuten Securities recorded a total of 8.05 million general securities customer accounts and a domestic equities market share of 33.5%. In August, the company’s total monthly purchasing amount for investment trusts surpassed 100 billion yen. In May 2022, a resolution was passed by the Rakuten Group board of directors to prepare for the initial public offering of Rakuten Securities, Inc. On August 10, 2022, the company announced that Rakuten Securities Holdings will apply for listing due to an organizational restructuring.

Mobile segment

Mobile segment revenue rose to 84.6 billion yen in Q2 FY2022, a significant increase of 64.5% YoY. Factors contributing to the increased revenue include the growth in paying subscriber numbers following the end of the free service plan campaign, and an increase in new subscribers. Operating losses of 124.3 billion yen were recorded. Losses peaked at 135.0 billion yen in Q1 FY2022, and decreases in roaming costs due to the switch from roaming partner areas to Rakuten network areas are also contributing to contracting losses from Q2, as forecast. Losses are forecasted to continue to decrease.

・ In May 2022, the new pricing plan Rakuten UN-LIMIT VII was announced. As of the end of June 2022, the total number of MNO and MVNO subscribers was 5.46 million*5. At the same time as 80% of churn is from users whose data use was previously under 1GB monthly, there has been an increase in users consuming over 1GB on a monthly basis.  Since announcing the new pricing plan, the percentage of subscribers who use Rakuten Mobile as their main line increased by 8.3 points, and the percentage of users with monthly data usage of 20GB or more also increased by 5.7 points.

・ The percentage of new Rakuten users among Rakuten Mobile subscribers was 21.5%*6 as of the end of June 2022. Rakuten Mobile has become a new entry point for acquiring new Rakuten users, contributing to further expansion of the Rakuten Ecosystem. In addition, among customers who already used Rakuten services, the average monthly per-user GMS on Rakuten Ichiba increased by 52% after subscribing to Rakuten Mobile, a strong demonstration of increased customer loyalty.

As of the end of June 2022, Rakuten Mobile reached 97.6% population coverage for the Rakuten 4G network area, with the number of outdoor 4G base stations on-air reaching 47,556.  Going forward, in 2023 Rakuten Mobile plans to expand its 4G population coverage area to more than 99% with more than 60,000 4G base stations, expanding the Rakuten network service area and continuing to improve the quality of its network.

*1 Domestic e-commerce GMS = Combined transaction amount for Rakuten Ichiba, Rakuten Travel (GTV on checkout basis), Rakuten Books, Rakuten Books network, Rakuten Kobo (domestic), golf business, Rakuten Fashion, Rakuten Dream businesses, Rakuten Beauty, Rakuten Delivery, Rakuten 24 and other first-party daily necessities shops, Rakuten Car, Rakuten Rakuma, Rakuten Rebates, Rakuten Seiyu Netsuper, cross border trading, etc. Excludes some tax-exempt businesses, includes consumption tax.

*2 Number of unique users with a Rakuten ID.

*3 Percentage of users of two or more services in the past 12 months divided by the number of users of all services in the past 12 months (as of the end of June 2022). Limited to use of services with which Rakuten Points can be earned.

*4 Percentage increase in registered users for each service as of June 30, 2022 compared with June 30, 2021.

*5 Number of subscribers are preliminary figures.

*6 Percentage of cumulative total of Rakuten Mobile subscribers from March 2020 or later who had not used a Rakuten service before subscribing to Rakuten Mobile.

*Please note that the information contained in press releases is current as of the date of release.

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