Slide 1: LY Corporation Business Results FY2024 Q2
LY Corporation Business Results FY2024 Q2 November 5, 2024 Security Code: 4689
Slide 2: FY2024 Q2 Business Results - Summary
FY2024 Q2 Business Results - Summary Revised FY2024 full-year guidance due to steady progress in performance. - FY2024 Q2 Result: Entire Group revenue JPY462.2 B (YoY+4.7%; highest Q2 result) 1 Entire Group adjusted EBITDA JPY112.6 B (YoY+9.1%; highest Q2 result) - FY2024 Consolidated business resul
Slide 3: Table of Contents
Table of Contents 1 Consolidated Business Results – Entire Group 2 Business Results – By Segment 3 Post-Merger Review and Future Initiatives
Slide 4: Consolidated Business Results – Entire Group
Table of Contents 1 Consolidated Business Results – Entire Group 2 Business Results – By Segment 3 Post-Merger Review and Future Initiatives
Slide 5: Entire Group FY2024 Q2 – Results
Entire Group FY2024 Q2 – Results • Progressing smoothly in line with guidance presented at the beginning of the fiscal year. Progress Against Guidance Segment Item FY2024 Q2 % YoY Change (First six months of fiscal year) Revenue JPY462.2 B +4.7% 47.8% Entire Group Adjusted EBITDA JPY112.6 B +9.1 % 5
Slide 6: Entire Group FY2024 Consolidated Full-Year Guidance
Entire Group FY2024 Consolidated Full-Year Guidance • Upward revision in adjusted EBITDA by +JPY20.0 B and adjusted EPS by +JPY4.1. Before Guidance Revision After Guidance Revision Segment Item FY2024 YoY FY2024 YoY Revenue Approx. JPY 1.93 T Approx. +7 % (No change) Adjusted EBITDA JPY 430.0 to 440
Slide 7: Factors Behind the Revision of Consolidated Performance Guidance
Entire Group Factors Behind the Revision of Consolidated Performance Guidance • Media Business and Strategic Business are expected to achieve growth beyond the initial plan. Adjusted EBITDA1 Guidance Adjusted EPS2 Guidance (JPY B) (JPY) Improvement in 450.0- adjusted EBITDA, etc. Commerce 460.0 18.5
Slide 8: Entire Group – Performance
Entire Group Entire Group – Performance • Adjusted EBITDA grew YoY and maintained a high-level margin. Revenue/YoY Growth Rate Adjusted EBITDA/YoY Growth Rate Adjusted EBITDA Margin (JPY B) (JPY B) +11.9% +41.6% +28.1% +17.4% +21.7% +7.8% +7.6% +9.1% +4.7% 26.3% +4.7% Growth Growth 24.4% Rate Rate 4
Slide 9: Entire Group – Performance: Factors of Change in Adjusted EBITDA
Entire Group Entire Group – Performance • Profit increased mainly as a result of revenue growth in account advertising and PayPay Consolidated. Factors of Change in Adjusted EBITDA1 Revenue: +JPY20.9 billion • Media (+JPY7.2 B): Growth in account advertising (JPY B) • Commerce (+JPY2.4 B): Growth in
Slide 10: Acquisition and Cancellation of Own Shares
Acquisition and Cancellation of Own Shares • As a result of the share buyback, expected to achieve the continued listing requirements for the Prime Market. Results of Share Buyback and Cancellation of Treasury Shares Capital Allocation Policy3 (Cumulative Approximate Value for FY2023-2025) (JPY B) S
Slide 11: Shareholder Return
Shareholder Return • Aim for a cumulative total payout ratio of 70% or more also in the next 5 years. Total Payout Total Payout Ratio2 (JPY B) 189.8 144.6% 134.8% 111.8 150.0 Share Buyback 5-year Cumulative Payout Ratio 68.2 74% 60.2% 42.2 41.9 41.9 37.0% 43.5 39.8 23.4% Dividends 3 FY20 FY21 FY22 F
Slide 12: Entire Group Security Measures
Entire Group Security Measures • Security measures are steadily being implemented. Cost of countermeasures is within the initial forecast. Security Countermeasure Expenses FY2024 Amount Recording Segment Item Business commissions/License Q1 Approx. JPY3.0 B Strategic1 fees, etc. Q2 Approx. JPY4.0 B
Slide 13: Business Results – By Segment
Table of Contents 1 Consolidated Business Results – Entire Group 2 Business Results – By Segment 3 Post-Merger Review and Future Initiatives
Slide 14: Media Business – Performance
Media Business Media Business – Performance • Increase in both revenue and profit driven by the growth in account advertising; margin also maintained high 30% range. Revenue/YoY Growth Rate1, 2, 3 Adjusted EBITDA/YoY Growth Rate1, 2, 3 Adjusted EBITDA Margin1, 2, 3 (JPY B) (JPY B) +4.1% +4.4% +4.2%
Slide 15: Media Business – Revenue
Media Business Media Business – Revenue • Revenue increased due to growth in account advertising and slowdown in decrease of search advertising revenue from partners’ websites. Revenue Entire Group total advertising revenue: (JPY B) +JPY9.0 billion 181.7 +4.2% Search advertising: +JPY1.0 billion 174
Slide 16: Media Business – Performance: Adjusted EBITDA Factors
Media Business Media Business – Performance • Income increased as a result of revenue growth and cost control. Factors of Change in Adjusted EBITDA1 Cost of sales: +JPY1.6 billion (JPY B) • Increased mainly in cost of sales related to search Increase in revenue advertising. +7.2 Increase in SG&A (Yo
Slide 17: Media Business Account Advertising
Media Business Account Advertising • No. of paid accounts increased steadily; will continuously strive to enhance ARPA.1 No. of Paid LINE Official Accounts (Global/Japan)2 Revenue (Thousands) (JPY B) 419 +25.4% 397 +22.9% +21.6% +21.4% 386 Pay-As-You-Go 375 36 +18.0% Billing Accounts2 35 353 34 35 3
Slide 18: Commerce Business – Performance
Commerce Business Commerce Business – Performance • Revenue increase in shopping and travel businesses absorbed the impact from the deconsolidation of subsidiaries. Revenue/YoY Growth Rate1, 2, 3 Adjusted EBITDA/YoY Growth Rate1, 2, 3 Adjusted EBITDA Margin1, 2, 3 (JPY B) (JPY B) +9.7% +49.0% +5.8%
Slide 19: Commerce Business – Transaction Value
Commerce Business Commerce Business – Transaction Value • Travel business’s growth rate exceeded +20% YoY; shopping business recorded positive growth despite the absence of last year’s demand from hometown tax reform. Entire Group – E-Commerce Transaction Value1 Domestic shopping business: +JPY12.1
Slide 20: Commerce Business – Performance: Adjusted EBITDA Factors
Commerce Business Commerce Business – Performance • Profit increased as a result of revenue growth and continued discipline in cost allocation. Factors of Change in Adjusted EBITDA1 Revenue: +JPY2.4 billion (JPY B) • Increased as a result of revenue growth in ZOZO, Improvement Yahoo! JAPAN Shopping,
Slide 21: Strategic Business – Performance
Strategic Business Strategic Business – Performance • PayPay Consolidated drove revenue and profit growth. Revenue/YoY Growth Rate1, 2 Adjusted EBITDA1, 2 Adjusted EBITDA Margin1, 2 (JPY B) (JPY B) 15.3 3 +17.5% +23.4% +20.9% +16.8% 18.9% +110.6% Approx. Growth 5.0 78.3 79.1 81.2 Rate 76.5 69.5 Appr
Slide 22: Strategic Business – Revenue
Strategic Business Strategic Business – Revenue • All businesses achieved steady growth. Revenue PayPay Consolidated: +JPY8.1 billion (JPY B) • Revenue from payment fees increased due to the 81.2 +16.8% expansion in consolidated GMV, and interest revenue increased resulting from expansion in revolvi
Slide 23: Strategic Business – Performance: Adjusted EBITDA Factors
Strategic Business Strategic Business – Performance • Revenue growth contributed to profit increase despite the uptick in point-reward expense due to the GMV growth of PayPay Consolidated. Factors of Change in Adjusted EBITDA1 Cost of sales: +JPY1.2 billion (JPY B) • Increased due to revenue increas
Slide 24: PayPay Consolidated Business Overview
Strategic Business PayPay Consolidated Business Overview • Consolidated GMV exceeded +20% YoY growth; profit significantly increased through profitability management and fixed cost reduction. No. of Registered Users¹ GMV (Consolidated) 2, 3 Revenue (Consolidated)4 EBITDA (Consolidated)5 (Mil) (JPY T
Slide 25: Post-Merger Review and Future Initiatives
Table of Contents 1 Consolidated Business Results – Entire Group 2 Business Results – By Segment 3 Post-Merger Review and Future Initiatives
Slide 26: One Year Since Merger ― Review
One Year Since Merger ― Review • Steadily accomplished the merger purposes: “reinforcement of profitability” and “enhancement of product development capabilities.” Purpose of Merger Major Achievements in One Year Since Merger • FY2023 Adjusted EBITDA came to JPY414.9 B exceeding medium-term target o
Slide 27: Future Initiatives
Future Initiatives 1 Official Account/MINI App 2 LINE Commerce 3 PayPay Finance 26
Slide 28: Driving Growth with LINE Official Account & LINE MINI App
Official Account/MINI App Driving Growth with LINE Official Account & LINE MINI App • Reinforce LINE MINI App to increase user touchpoints and reinforce monetization. • Improve profitability leveraging LINE’s unique strength. LINE Official Account LINE MINI App Users User Touchpoints Facilitates com
Slide 29: Examples of Improving ARPA
Official Account/MINI App Examples of Improving ARPA1 • Aim to enhance convenience by adding features to the existing messaging function. Increase in No. of Message Deliveries Reinforcement of LINE MINI App3 • Introduced LINE notification messages • Introduced reservation/mobile orders on LINE • Ena
Slide 30: LINE GIFT
LINE Commerce LINE GIFT • Aim for the annual transaction value to exceed JPY100 B early, maintaining over YoY +30% growth in the next 5 years. Gift Market in Japan/Forecast1 Transaction Value Future Focus Areas (JPY T) 10.8 11.0 YoY 28.9% Product 10.5 9.9 10.1 Enrich lineup to accommodate various gi
Slide 31: LINE Commerce
LINE Commerce LINE Commerce • Boost LINE users’ engagement with commerce services through the LINE revamp. Now New Shopping Tab1 Offer shopping experiences To be revamped from FY2024 originating from LINE Q4 onwards1,2 Create a shopping platform suited to LINE users’ purchase behavior Propose produc
Slide 32: Growth of PayPay
PayPay Finance Growth of PayPay • PayPay business is expanding rapidly, establishing itself as Japan’s No.1 code payment service. No. of Registered Users (Standalone)1 No. of Payments (Standalone) 2 GMV (Standalone) 2, 3 (Mill) (Mill) (JPY T) 63.04 6,367 10.1 56.64 5,141 7.9 46.79 38.03 3,632 5.4 2,
Slide 33: Service Linkage in Financial Business
PayPay Finance Service Linkage in Financial Business • Further accelerate growth in the financial business through service linkage with PayPay. No. of PayPay Bank Accounts PayPay Card Transaction Volume Measures – By Opening Channel (Cumulative) (JPY B) (Mill) PayPay Card October 2022 August 2022 Co
Slide 34: FY2024 Q2 Business Results - Summary
FY2024 Q2 Business Results - Summary Revised FY2024 full-year guidance due to steady progress 1 in performance. 2 Group-wide issues are moving steadily toward resolution. 3 Reinforcing products to drive top-line growth. 33
Slide 35: Disclaimer
Disclaimer Statements made at the meeting or included in the documents that are not historical facts are forward-looking statements about the future performance of LY Corporation (Company) and its consolidated subsidiaries and affiliates. The Company cautions you that a number of important factors c
Slide 36: Create an amazing life platform that brings WOW! to our users.
Create an amazing life platform that brings WOW! to our users.