November 11, 2022
  • Rakuten Group, Inc.

Rakuten Group Q3 FY2022 Financial Results Highlights

Overall Performance

・ The Rakuten Group recorded revenue growth in all three segments in Q3 FY2022: Internet Services, FinTech and Mobile. Consolidated revenue achieved double-digit growth, up 15.8% year-on-year (YoY), reaching a total of 471.1 billion yen and marking the highest revenue ever recorded by the Rakuten Group in the third quarter of a fiscal year. Continuing the strong growth from the previous quarter, domestic e-commerce*1 gross merchandise sales (GMS) achieved double-digit growth, up 13.1% YoY. This was the result of factors including sustained user retention by Rakuten Ichiba even in the wake of pandemic-driven stay-at-home consumption, as well as the recovery of Rakuten Travel, which successfully captured summer vacation travel demand. Customer base expansion in Rakuten’s fintech services also contributed to the revenue increase.

・ In Q3 FY2022, the average number of monthly active users*2 across the Rakuten Group in Japan surpassed 38 million, up 11.0% YoY.  The Rakuten Ecosystem customer base continues to grow, with 74.9% of all users using two or more services over the past 12 months.

 ・ Due to ongoing strategic investment in future growth for the Mobile segment, including the installation rollout of network base stations, the Rakuten Group recorded Non-GAAP operating losses of 78.6 billion yen in Q3 FY2022. Excluding the Mobile and investment businesses, Non-GAAP operating income was 47.2 billion yen, up 7.8% YoY. At Rakuten Mobile,  average revenue per user (ARPU) rose in line with the launch of the new Rakuten UN-LIMIT VII pricing plan. Cost reductions achieved by switching from roaming in partner network areas to Rakuten’s network have also led to gradual decreases in Mobile segment losses, which peaked in Q1 FY2022. Going forward, losses are forecast to continue to decrease.

Internet Services segment

Revenue for the Internet Services segment in Q3 FY2022 was 259.7 billion yen, up 8.8% YoY. Excluding the investment business, Non-GAAP operating income for the quarter was 24.8 billion yen, up 24.1% YoY.

・ Domestic e-commerce gross merchandise sales (GMS) in Q3 FY2022 reached 1.35 trillion yen, up 13.1% YoY. GMS based on shippings from Rakuten Seiyu Netsuper’s network of distribution centers was up 32.2% YoY, achieving a high rate of growth. In addition, GMS for Rakuten Rebates, the core service in Rakuten’s Japan-based open e-commerce business, rose by 44.1% YoY.

・ In overseas businesses, revenue for U.S.-based cashback service Rakuten Rewards in Q3 FY2022 grew to 22.3 billion yen, up 15.2% YoY, as a result of successful marketing initiatives and recovery in consumer shopping habits.

FinTech segment

In Q3 FY2022, the FinTech segment recorded increases in both revenue and profit. Revenue was 166.5 billion yen, up 10.3% YoY, and Non-GAAP operating profit was 25.2 billion yen, an increase of 19.0% YoY.

Rakuten Card continues to grow and has issued a cumulative total of 27.51 million cards as of the end of September 2022. Boosted by continued growth in the number of cards issued and high usage rates, Rakuten Card’s shopping gross transaction value (GTV) in Q3 FY2022 reached 4.6 trillion yen, up 27.4% YoY, and its market share of Japan’s domestic shopping GTV expanded steadily to 23.0% (as of August 2022).

Rakuten Bank reached 13.03 million non-consolidated customer accounts as of the end of September 2022. In addition to the convenience offered by its online services, the synergy Rakuten Bank has generated through a wide range of initiatives leveraging various Rakuten Group services has been well-received, and the number of bank accounts continues to grow. In July, Rakuten Bank submitted its application for listing on the Tokyo Stock Exchange.

Rakuten Securities reached a total of 8.36 million securities customer accounts as of the end of September 2022. The company established Rakuten Securities Holdings and completed the organizational restructuring of the securities business in October. Going forward, the company will aim for an initial public offering of Rakuten Securities Holdings, Inc. Also in October, the company announced the conclusion of a strategic capital and business alliance with Mizuho Securities Co., Ltd.

In the Rakuten Insurance Group, in-person sales channels are recovering from the pandemic slow-down. Annualized New Business Premiums (ANP)of new policies sold in-person grew significantly, increasing by 26.0% YoY for Rakuten Life Insurance and by 27.2% YoY for Rakuten General Insurance. In addition, the number of agencies selling Rakuten Life Insurance’s group credit life insurance increased.

The Payment business delivered even greater levels of convenience to users through Rakuten Pay app collaborations with Seven Bank, Air PAY and Rakuten Card. Users are now able to benefit from an expanded range of services, including contactless “touch” payments with their Rakuten Card through the Rakuten Pay app.

Mobile segment

Mobile segment revenue rose to 89.3 billion yen in Q3 FY2022, a significant increase of 62.5% YoY. Operating losses of 120.9 billion yen were recorded, continuing to contract for the second quarter in a row, having peaked at 135.0 billion yen in Q1 FY2022. This was the result of factors such as lower costs for network-related capital expenditure, rising ARPU in line with the launch of the new Rakuten UN-LIMIT VII pricing plan, and reduced roaming costs due to the transition from roaming partner areas to Rakuten network areas. Losses for the Mobile segment are forecast to continue to decrease.

ARPU (average revenue per user) increased 75.9% to 1,472 yen in Q3 FY2022, compared to 837 yen in Q1 FY2022, before the announcement of "Rakuten UN-LIMIT VII"*3. Continued increases in data usage and the end of the essentially free service campaign are expected to contribute to revenue.

The total number of MNO and MVNO subscribers was 5.18 million as of the end of September 2022 *4. Even after the conclusion of the essentially free service campaign for subscribers at the end of October 2022, subscriptions are showing net growth. The average number of Rakuten services used increased as a result of Rakuten Mobile subscriptions (average number of services used per user after subscribing to Rakuten Mobile increased by 2.57 compared with pre-subscription levels, reaching 7.13 services)*5. In addition, the average annual purchase amount on Rakuten Ichiba for Rakuten Mobile subscribers is 35,831 yen higher than for non-subscribers*6. This is greatly contributing to enhanced membership value.

Rakuten Mobile reached 97.9% population coverage for the Rakuten 4G network area, with the number of outdoor 4G base stations on-air reaching 50,408 as of the end of September 2022. 

Just one year since launch in August 2021, Rakuten Symphony has reached 14 customers as of Q3 FY2022 with orders exceeding US$3.1 billion. The cumulative sales revenue from launch until Q3 FY2022 reached US$315 million.

*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 Point rebate program implemented in September-October 2022 for users with less than 1 GB deducted from sales.
*4 Preliminary subscriber figures.
*5 Users who applied to Rakuten Mobile by October 2021 and are chargeable. Cross-use numbers include Rakuten Mobile.
*6 Average annual purchases between October 2021 and September 2022 for mobile users who have subscribed for at least one year.

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

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