Gree Holdings.inc. · TSE:3632
Gree Holdings.inc — Q2 FY2024 Earnings Presentation
56 slides from Gree Holdings.inc's earnings presentation, Feb 7, 2024
Slide 1: FY2024 Second Quarter Financial Results
GREE, Inc. FY2024 Second Quarter Financial Results February 7, 2024 Copyright © GREE, Inc. All Rights Reserved.
Slide 2: Executive Summary
Executive Summary FY24 2Q Financial Results ◼ Net sales ¥14.2 billion, operating income ¥0.8 billion, EBITDA ¥0.9 billion Overview ⁃ In line with expectations (Consolidated) ◼ Sales and income declined QoQ on title closures and the winding down of the Game and impact of anniversary events in 1Q Anim
Slide 3: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 4: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 5: FY24 2Q Financial Results Overview
1. Financial Results Overview (Consolidated) FY24 2Q Financial Results Overview Net sales ¥14.2 billion, operating income ¥0.8 billion, EBITDA ¥0.9 billion Billions of yen FY24 FY24 FY23 2Q QoQ YoY 1Q 2Q Net sales 14.24 -1.55 -10% -2.34 -14% 15.79 16.58 Operating income 0.81 -0.42 -34% -0.92 -53% 1.
Slide 6: Net Sales and Operating Income
1. Financial Results Overview (Consolidated) Net Sales and Operating Income Sales and income down QoQ Billions of yen 22.15 20.12 24.6% 16.58 15.79 19.1% 14.24 10.5% 7.8% 4.22 4.96 5.7% 1.73 1.23 0.81 2Q 3Q 4Q 1Q 2Q FY23 FY24 Consolidated net sales Net sales (excluding Investment Business) (Investme
Slide 7: Sales and Operating Income by Segment
1. Financial Results Overview (Consolidated) Sales and Operating Income by Segment Billions of yen FY23 FY24 QoQ YoY 2Q 3Q 4Q 1Q 2Q Game and Sales 12.16 15.85 12.77 11.72 10.44 -1.28 -11% -1.73 -14% Anime Operating income 1.65 2.06 2.06 1.56 1.35 -0.22 -14% -0.30 -18% Sales 1.64 1.52 1.82 1.96 1.79
Slide 8: 2Q Operating Income Analysis
1. Financial Results Overview (Consolidated) 2Q Operating Income Analysis Income declined QoQ, operating income was ¥0.8 billion Billions of yen ¥0.42bn decrease 1.23 -1.55 ＋0.83 0.81 Operating Operating income ＋0.30 income Decrease in FY24 1Q fixed costs FY24 2Q Sales decline Decrease in variable c
Slide 9: 2Q Cost Structure
1. Financial Results Overview (Consolidated) 2Q Cost Structure Total costs declined by ¥1.1bn to ¥13.4bn Billions of yen FY24 FY24 FY23 Factors in change（QoQ） 2Q QoQ YoY 1Q 2Q Advertising 1.18 0.16 -0.07 Increase on strengthening of promotions for Heaven Burns Red 1.01 1.24 Commission fees, etc. 3.9
Slide 10: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 11: Earnings Estimates and Forecast by Segment
2. Operational Overview Earnings Estimates and Forecast by Segment Billions of yen FY23 FY24 3Q FY24 Full-year FY24 2Q Full-year Estimates QoQ Forecast YoY Result Result Game and Sales 11.40-13.50 0.96 – 3.06 +9% – +29% 41.0-45.0 -13.0 – -9.0 -24% – -17% 10.44 53.7 Anime Operating 1.60-2.10 0.25 – 0
Slide 12: FY24 Full-Year Earnings Forecast Progress (as of 2Q FY24)
2. Operational Overview FY24 Full-Year Earnings Forecast Progress (as of 2Q FY24) 25％ 50％ 75％ Sales 54％ ¥22.2bn ¥41.0-45.0bn Game and Anime Operating income 58% ¥2.9bn ¥5.0-6.0bn Sales 46% ¥3.7bn ¥8.1bn Metaverse Operating income ¥0.0bn ¥0.0bn -¥0.2bn Sales 46% ¥2.6bn ¥5.7bn DX Operating income 55%
Slide 13: Game and Anime Business
Game and Anime Business Senior Vice President Yuta Maeda Copyright © GREE, Inc. All Rights Reserved.
Slide 14: Sales and Operating Income
2. Operational Overview: Game and Anime Business Sales and Operating Income Sales Operating Income QoQ -11% YoY -14% QoQ -14% YoY -18% Billions of yen Billions of yen 17.27 3.61 16.93 16.28 15.85 3.26 2.82 13.22 12.98 13.06 12.88 12.57 12.54 12.77 12.16 2.56 11.92 11.72 2.48 11.32 11.38 2.26 10.44 9
Slide 15: Summary of the Game and Anime Business
2. Operational Overview: Game and Anime Business Summary of the Game and Anime Business Sales and Operating Income Focus Points Sales: QoQ -11% YoY -14% / Operating Income: QoQ -14% YoY -18% Billions of yen ◼ Sales and income declined on title 15.85 closures and the winding down of the impact of eve
Slide 16: WFS, Inc.
2. Operational Overview: Game and Anime Business WFS, Inc. Sales and Operating Income Focus Points Sales: QoQ -11% YoY -11% / Operating Income: QoQ -56% YoY -13% Billions of yen 11.09 ◼ Sales declined QoQ on a reactive decline from the 1.5-year anniversary of Heaven Burns Red 8.28 7.62 7.60 15.0% 6.
Slide 17: Pokelabo, Inc.
2. Operational Overview: Game and Anime Business Pokelabo, Inc. Sales and Operating Income Focus Points Sales: QoQ -48% YoY -58% / Operating Income: QoQ ¥0.26bn YoY -198% Billions of yen ◼ Sales declined QoQ on the closure of SINoALICE 1.42 1.36 1.31 ◼ Focused on working on new titles 1.06 11.5% 4.5
Slide 18: GREE Entertainment, Inc.
2. Operational Overview: Game and Anime Business GREE Entertainment, Inc. Sales and Operating Income Focus Points Sales: QoQ +4% YoY +5% / Operating Income: QoQ +138% YoY +2% Billions of yen ◼ Strong performance due to 1.31 successes in licensing and in 27.9% 1.14 1.18 outsourced development project
Slide 19: Pipeline
2. Operational Overview: Game and Anime Business Pipeline Make progress on strengthening and rebuilding our pipeline in order to constantly release new titles In-house Regional Joint Licensing to other development expansion development companies 4 8 4 2 Notes: ● Number of titles scheduled for releas
Slide 20: Earnings Estimates (3Q FY24)
2. Operational Overview: Game and Anime Business Earnings Estimates (3Q FY24) Sales and Operating Income Focus Points Billions of yen Sales: QoQ +9% - +29% / YoY -28% - -15% Operating Income: QoQ +19% - +56% / YoY -22% - +2% ◼ We expect sales and income to rise 15.85 owing to 2-year anniversary even
Slide 21: Earnings Forecast (Full-Year FY24)
2. Operational Overview: Game and Anime Business Earnings Forecast (Full-Year FY24) Sales and Operating Income Focus Points Billions of yen Sales: YoY -24% - -17% / Operating Income: YoY -35% - -21% ◼ We made steady progress toward 53.7 our sales and operating income 45.0 targets and expect to reach
Slide 22: Medium-term Targets
2. Operational Overview: Game and Anime Business Medium-term Targets Sales and Operating Income Focus Points Billions of yen 60.3 ◼ Sales forecasts factor in impact 53.8 from changes in release schedules 53.7 for new titles, contribution from 41.0-45.0 new titles is factored in CAGR conservatively 1
Slide 23: Metaverse Business
Metaverse Business Senior Vice President Eiji Araki Copyright © GREE, Inc. All Rights Reserved.
Slide 24: Sales and Operating Income
2. Operational Overview: Metaverse Business Sales and Operating Income Sales Operating Income QoQ -9% YoY +9% QoQ -198% YoY -1,739% Billions of yen Billions of yen 1.96 0.13 0.13 0.12 1.82 1.79 0.10 1.69 0.06 1.64 1.52 1.48 0.01 1.34 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 1.23 1.13 FY
Slide 25: Summary of the Metaverse Business
2. Operational Overview: Metaverse Business Summary of the Metaverse Business Sales and Operating Income Focus Points Sales: QoQ -9% YoY +9% / Operating Income: QoQ -198% YoY -1,739% Billions of yen ◼ Sales in the Platform Business were 1.96 relatively weak owing to a reactive 1.82 1.79 decline foll
Slide 26: Platform Business (REALITY, Inc.)
2. Operational Overview: Metaverse Business Platform Business (REALITY, Inc.) Sales and Operating Income Focus Points Sales: QoQ -13% YoY +13% / Operating Income: QoQ -52% YoY +547% Billions of yen ◼ Sales were relatively weak owing to 1.79 a reactive decline following 5-year 22.8% anniversary campa
Slide 27: VTuber Business (REALITY Studios, inc.)
2. Operational Overview: Metaverse Business VTuber Business (REALITY Studios, inc.) Sales and Operating Income Focus Points Sales: QoQ +12% YoY +119% / Operating Income: QoQ -¥0.08bn YoY -¥0.25bn Billions of yen ◼ Steady growth of our talent pool 0.08 0.09 owing to the debut of the first 0.05 genera
Slide 28: Earnings Estimates (3Q FY24)
2. Operational Overview: Metaverse Business Earnings Estimates (3Q FY24) Sales and Operating Income Focus Points yen QoQ -8% YoY +8% / Operating Income: QoQ ¥0.13bn YoY ¥0.25bn Billions ofSales: Billions of yen ◼ In the Platform Business, we will 1.96 focus on expanding into new live 1.82 6.0% 1.79
Slide 29: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: Metaverse Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Income Focus Points Billions of yen Sales: YoY +7% Operating Income: YoY ¥0.4bn ◼ We expect strong performance in 8.1 the Platform Business; we will 7.1 continue to invest aggressively in
Slide 30: Medium-term Targets
2. Operational Overview: Metaverse Business Medium-term Targets Sales and Operating Income Focus Points Billions of yen ◼ We expect steady income growth in 15.2 the Platform Business as we continue to invest in the VTuber CAGR Business, resulting in FY2026 46％ operating income of ¥1.9bn 7.1 6.7 5.2
Slide 31: DX Business
DX Business Vice President Kazuhisa Adachi Copyright © GREE, Inc. All Rights Reserved.
Slide 32: Sales and Operating Income
2. Operational Overview: DX Business Sales and Operating Income Sales Operating Income QoQ +4% YoY -7% QoQ +22% YoY -22% Billions of yen Billions of yen 0.32 1.55 Sales accounting standards have been revised for some products 1.44 1.46 1.44 0.28 1.38 1.36 1.32 1.35 1.29 1.27 1.29 1.30 1.22 1.25 0.25
Slide 33: Summary of the DX Business
2. Operational Overview: DX Business Summary of the DX Business Sales and Operating Income Focus Points Sales: QoQ +4% YoY -7% / Operating Income: QoQ +22% YoY -22% Billions of yen ◼ The DX Business as a whole grew 1.46 1.44 owing to year-end demand for 22.3% 1.35 marketing DX 1.25 1.30 19.3% ◼ Oper
Slide 34: Marketing DX Business
2. Operational Overview: DX Business Marketing DX Business Sales and Operating Income Focus Points Sales: QoQ +5% YoY -6% / Operating Income: QoQ +18% YoY -22% Billions of yen ◼ Sales and operating income 1.11 1.10 1.05 increased on support for large-scale 0.99 marketing initiatives leading up to 23
Slide 35: Operational DX Business
2. Operational Overview: DX Business Operational DX Business Sales and Operating Income Focus Points Sales: QoQ +0% YoY -12% / Operating Income: QoQ -6% YoY -21% Billions of yen ◼ Continued support for existing 0.35 0.35 projects 17.6% 0.32 0.30 0.31 ◼ We will strengthen operations for 15.2% 14.1% n
Slide 36: Earnings Estimates (3Q FY24)
2. Operational Overview: DX Business Earnings Estimates (3Q FY24) Sales and Operating Income Focus Points Sales: QoQ +4% YoY -3% / Operating Income: QoQ -12% YoY -39% Billions of yen ◼ Targeting top-line growth via the 1.44 1.41 launch of new support projects 22.3% 1.35 1.30 1.25 16.3% 14.6% 13.9% 1
Slide 37: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: DX Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Income Focus Points Sales: YoY +6% Billions of yen Operating Income: YoY -20% 5.7 5.8 ◼ Making progress in line with forecast 5.4 ◼ We forecast accelerated growth in 2H and therefore expect to a
Slide 38: Medium-term Targets
2. Operational Overview: DX Business Medium-term Targets Sales and Operating Income Focus Points Billions of yen ◼ We will strive to maintain a rate of 7.9 CAGR growth above the industry average 17％ while increasing the ratio of 5.8 businesses that produce recurring 5.4 revenue 5.0 CAGR 1.0 21％ 1.2
Slide 39: Commerce Business
Commerce Business Vice President Yosuke Nakamura Copyright © GREE, Inc. All Rights Reserved.
Slide 40: Sales and Operating Income
2. Operational Overview: Commerce Business Sales and Operating Income Sales Operating Income QoQ +11% YoY +3% QoQ +68% YoY +1,097% Billions of yen Billions of yen 0.37 0.37 0.36 0.05 0.36 0.34 0.35 0.34 0.03 0.33 0.33 0.31 0.31 0.31 0.03 0.30 0.29 0.01 0.02 0.01 0.01 0.01 0.00 0.00 1Q 2Q 3Q 4Q 1Q 2Q
Slide 41: Sales and Operating Income (aumo, Inc.)
2. Operational Overview: Commerce Business Sales and Operating Income (aumo, Inc.) Sales Operating Income QoQ +9% YoY +17% QoQ +49% YoY +137% Billions of yen Billions of yen 0.30 0.03 0.03 0.28 0.02 0.27 0.02 0.02 0.26 0.26 0.02 0.25 0.01 0.01 0.01 0.01 0.01 0.23 0.23 0.22 0.01 0.22 0.00 0.20 0.21 0
Slide 42: Summary of the Commerce Business
2. Operational Overview: Commerce Business Summary of the Commerce Business Sales and Operating Income Focus Points Sales: QoQ +11% YoY +3% / Operating Income: QoQ +68% YoY +1,097% Billions of yen ◼ Sales increased by 3% YoY and 0.34 profit increased for the second 0.33 0.31 0.31 consecutive quarter
Slide 43: aumo, Inc.
2. Operational Overview: Commerce Business aumo, Inc. Sales and Operating Income Focus Points Sales: QoQ +9% YoY +17% / Operating Income: QoQ +49% YoY +137% Billions of yen ◼ Sales rose 17% YoY and operating 0.30 income rose 137% YoY as sales and 0.28 profit rose for the second 0.26 0.27 0.26 9.7% c
Slide 44: Earnings Estimates (3Q FY24)
2. Operational Overview: Commerce Business Earnings Estimates (3Q FY24) Sales and Operating Income Focus Points Sales: QoQ +14% YoY +25% / Operating Income: QoQ +88% YoY ¥0.03bn Billions of yen ◼ Sales are expected to increase by 0.39 25% YoY for the third consecutive 0.34 quarterly rise and we expe
Slide 45: Earnings Estimates and Forecast (Full-Year FY24)
2. Operational Overview: Commerce Business Earnings Estimates and Forecast (Full-Year FY24) Sales and Operating Income Focus Points Sales: YoY +16% Billions of yen Operating Income: YoY ¥0.1bn 1.5 1.5 ◼ Sales are expected to increase by 16% YoY to ¥1.5 billion 1.3 ◼ Operating income is expected to b
Slide 46: Medium-term Targets
2. Operational Overview: Commerce Business Medium-term Targets Sales and Operating Income Focus Points Billions of yen ◼ Sales are expected to reach ¥3.3 3.3 billion on growth at aumo, jobda, and LIMIA CAGR 50％ ◼ Operating income is expected to be ¥0.4 billion as investment in jobda is offset by gro
Slide 47: Investment Business
Investment Business Senior Vice President, Chief Financial Officer Toshiki Oya Copyright © GREE, Inc. All Rights Reserved.
Slide 48: Summary of the Investment Business
2. Operational Overview: Investment Business Summary of the Investment Business Sales and Operating Income Focus Points Sales: QoQ -22% YoY -58% / Operating Income: QoQ ¥0.06bn YoY -141% Billions of yen 4.09 ◼ There were no large-scale distributions from investment funds 3.41 in 1Q and we posted a q
Slide 49: Overview of Total Assets Under Management (AUM)
2. Operational Overview: Investment Business Overview of Total Assets Under Management (AUM) Total AUM: 83.1 billion, up ¥0.4 billion QoQ on capital call etc. Total AUM Main investments Billions of yen Based on investee valuation Fund Investments 82.7 +2.1 -1.1 -0.6 83.1 Fund Investment Increase by
Slide 50: Rise in unrealized value
2. Operational Overview: Investment Business Strengthening Investment Operational investment securities investment valuation of ¥32.6 billion, unrealized value remains high Quarterly change in operational investment securities investment valuation Investment status in 2Q Billions of yen Book value V
Slide 51: Status of Investment Results
2. Operational Overview: Investment Business Status of Investment Results Achieved high long-term returns on fund investments and startup investments Valuation of investments by investment period Net multiples, IRR Billions of yen Investment Results of GREE 13.6 Performance Benchmarking of Domestic
Slide 52: Contents
Contents 1. Financial Results Overview 2. Operational Overview 3. Appendix Copyright © GREE, Inc. All Rights Reserved.
Slide 53: 2Q FY24 Cost Structure
3. Appendix 2Q FY24 Cost Structure Billions of yen FY24 FY24 FY23 2Q QoQ YoY 1Q 2Q Rental charges 0.57 -0.01 -0.07 0.58 0.64 Labor costs 2.37 -0.04 0.14 2.41 2.23 Others 3.62 -0.42 -0.83 4.04 4.45 Cost of sales 6.56 -0.46 -0.76 7.02 7.32 Advertising 1.18 0.16 -0.07 1.01 1.24 Commission fees 2.58 -0.
Slide 54: 2Q FY24 Balance Sheet
3. Appendix 2Q FY24 Balance Sheet Billions of yen FY24 FY24 FY23 2Q QoQ YoY 1Q 2Q Current assets 109.0 1.5 7.9 107.5 101.1 Fixed assets 16.9 -0.1 1.3 16.9 15.6 Total assets 125.8 1.4 9.2 124.4 116.6 Current liabilities 15.7 -4.0 1.2 19.7 14.4 Fixed liabilities 18.3 6.0 1.6 12.3 16.7 Total liabilitie
Slide 55: Group Headcount
3. Appendix Group Headcount Number of employees 1,670 1,667 1,640 1,618 1,593 804 806 784 790 786 138 174 176 176 140 360 338 354 352 353 67 66 62 60 60 13 13 13 15 17 147 141 154 157 154 103 109 109 101 96 2Q 3Q 4Q 1Q 2Q FY23 FY24 Game and Anime Metaverse DX Commerce Investment Common Others Notes:
Slide 56: This document includes forecasts, which are based on currently available information. Actual performance may
◼ This document includes forecasts, which are based on currently available information. Actual performance may differ due to various factors. ◼ When producing this document, we were careful to avoid errors or omissions, but the accuracy and completeness of the provided information is not guaranteed.