Slide 1: FY2017-2Q Business Results
Yahoo Japan Corporation FY2017-2Q Business Results (July - September 2017) October 27, 2017
Slide 2: Table of Contents
Table of Contents P. 4 FY2017-2Q Financial Highlights P. 14 Usage Trend of Services P. 18 Media Business P. 24 Commerce Business P. 41 Technology P. 44 Supplemental Information Unless otherwise specified, English-language documents are prepared solely for the convenience of readers outside Japan. If
Slide 3: Forward-looking statements
Statements made at the meeting or included in the documents that are not historical facts are forward-looking statements about the future performance of Yahoo Japan Corporation and its consolidated subsidiaries and affiliates. The Company cautions you that a number of important factors could cause a
Slide 4: FY2017-2Q Financial Highlights
FY2017-2Q Financial Highlights 4
Slide 5: Executive Summary for FY2017-2Q
Executive Summary for FY2017-2Q Revenue 215.2 (¥B) YoY +4.8% Operating income 42.7 (¥B) YoY -13.6% EBITDA 53.2 (¥B) YoY -9.7% Net income attributable to owners of the parent 31.7 (¥B) YoY -5.6% Diluted EPS ¥5.5 YoY -5.6% Advertising-related revenue 74.3 (¥B) YoY +7.0% Via smartphones 55.5% Display a
Slide 6: Executive Summary for FY2017-2Q
Executive Summary for FY2017-2Q Media Business -Video viewing time has more than tripled YoY due to enhancement of video content. Commerce Business -Shopping transaction value (*1) maintained a growth rate of approx. +40% YoY. -Number of both new and repeat buyers in Yahoo! Shopping increased signif
Slide 7: Revenue
Revenue (¥Billion) 300 ¥215.2 billion Revenue of ASKUL Group consolidated to Yahoo! JAPAN YoY +4.8% Revenue excluding ASKUL Group 205.3 200 138.2 100 124.9 133.2 113.5 0 FY2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q
Slide 8: Revenue Breakdown
Revenue Breakdown (¥Billion) 205.3 215.2 Media Business -0.4 5.7 6.1 YoY +2.1% 52.7 +6.7 59.4 Growth in paid search advertising revenue Commerce Business Revenue of ASKUL Group YoY +6.3% 80.3 +1.6 82.0 consolidated Excluding ASKUL Group YoY +12.7% to Yahoo! JAPAN Growth in Shopping-related advertisi
Slide 9: Operating Income
Operating Income (¥Billion) ¥42.7 billion YoY -13.6% 102.7 100 Gain from remeasurement relating to business combination 49.5 50 49.2 42.9 42.2 [+0.2] [-0.2] [+0.8] 0 FY2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q JGAA
Slide 10: Factors of Change in Operating Income
Factors of Change in Operating Income (¥Billion) Investment for maximizing Increase due to e-Commerce transaction business growth value 49.5 +3.7 -8.3 Investment for becoming a data-driven company -2.1 42.7 FY2016 FY2017 2Q 2Q 10
Slide 11: EBITDA
EBITDA (¥Billion) ¥53.2 billion YoY -9.7% 100 58.9 50 0 FY2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q JGAAP IFRS 11 Note: EBITDA = operating income + depreciation and amortization Figures before FY2012 are those of o
Slide 12: Sales Promotional Activities
Sales Promotional Activities(*1) (¥Billion) FY2015 FY2016 FY2017 FY2017-2Q Rough breakdown Shopping 35% 18.6 Media 20% 14.9 13.7 12.7 Membership Services (*2) 20% 10.9 YAHUOKU! 15% 8.5 9.5 6.5 Financial & Payment 10% 4.2 5.2 1Q 2Q 3Q 4Q 12 *1 Total of sales promotion costs and advertising expenses.
Slide 13: Net Income Attributable to Owners of the Parent
Net Income Attributable to Owners of the Parent (¥Billion) ¥31.7 billion YoY -5.6% 100 50 33.6 0 FY2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q 2Q JGAAP IFRS Note: Figure of FY2015-2Q includes the gain from remeasurement
Slide 14: Usage Trend of Services
Usage Trend of Services 14
Slide 15: Daily Unique Browsers
Daily Unique Browsers (Million) Smartphones *1 92.35 93.01 PC+Others *2 85.09 73.53 Usage via 61.00 60.04 62.61 smartphones 51.61 39.43 25.34 67.3% FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q *1 Quarterly average; includes accesses to Yahoo! JAPAN via applications and browsers. Access via appl
Slide 16: Number of Monthly Active User IDs
Number of Monthly Active User IDs (Million) 41.58 YoY 27.60 28.56 31.45 36.14 +15.0% September September September September September 2013 2014 2015 2016 2017 16 Note: Number of Yahoo! JAPAN IDs logged-in in each month
Slide 17: DAU of All Applications
DAU of All Applications (Million) 43.94 YoY 33.31 34.43 36.54 40.30 +31.9% FY2016 FY2017 2Q 3Q 4Q 1Q 2Q Note: Quarterly average of the number of users who browsed smartphone applications offered by Yahoo! JAPAN at least once a day. Users are counted separately for 17 each smartphone application, eve
Slide 18: Media Business
Media Business Advertising Media 18
Slide 19: Advertising-Related Revenue
Advertising-Related Revenue (¥Billion) Display 74.3 Paid search 69.4 65.7 60.5 56.4 37.8 18.8 22.3 29.6 34.5 YoY 37.5 38.2 36.1 34.8 36.5 +7.0% FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q 19
Slide 20: Advertising Revenue via Smartphones
Advertising Revenue via Smartphones (¥Billion) Display Paid search 41.2 34.4 27.2 YoY 11.1 19.9 Approx. +20% FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q 20
Slide 21: Ratio of Advertising Revenue via Smartphones
Ratio of Advertising Revenue via Smartphones 55.5% 49.5% 33.0% 41.4% Record 19.8% high FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q Note: Proportion of advertising revenue via smartphones in total advertising revenue. Prior data have been retroactively adjusted. 21 Includes part of advertising
Slide 22: Media Business
Media Business Advertising Media 22
Slide 23: Video Viewing Time
Video Viewing Time September: Started video autoplay on Android timeline April: Launched YoY Yahoo! News Video 3.3 x due to various measures FY2016 FY2017 2Q 3Q 4Q 1Q 2Q 23 Note: Quarterly total of video viewing time in Yahoo! JAPAN services excluding GYAO!. * Survey by Yahoo! JAPAN
Slide 24: Commerce Business
Commerce Business Membership Shopping Auction Financial & Payment 24
Slide 25: Number of Monthly Paid-Membership IDs
Number of Monthly Paid-Membership IDs (Million) Others 24.70 Yahoo! Premium members 17.37 14.41 14.67 15.99 YoY 11.24 12.25 17.93 +42.1% 9.52 9.87 September September September September September (end of month) 2013 2014 2015 2016 2017 Note: Number of monthly paid-membership ID is the total of Yaho
Slide 26: Commerce Business
Commerce Business Membership Shopping Auction Financial & Payment 26
Slide 27: Shopping Transaction Value
Shopping Transaction Value (¥Billion) 140.7 YoY 53.4 60.8 79.1 101.1 +39.1% FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q 27 Note: Includes transaction values of Yahoo! Shopping and LOHACO. LOHACO’s transaction value is the revenue (closing date: 20th of every month) of LOHACO business, operated
Slide 28: Shopping-Related Advertising Revenue
Shopping-Related Advertising Revenue (¥Billion) 5.5 YoY 1.4 3.1 Approx. 1.8 x 0.8 0.8 FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q Note: Total of Yahoo Japan Corporation’s non-consolidated Shopping-related advertising revenue; advertising revenue of StoreMatch, an advertising product in Yahoo!
Slide 29: Yahoo! Shopping ― Number of Buyers
Yahoo! Shopping ― Number of Buyers New buyers Repeat buyers Number of both new and repeat buyers increased FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q Note: Number of new buyers is the number of IDs of buyers who purchased for the first time, and of buyers whose purchase was made after a lapse
Slide 30: Yahoo! Shopping ― Transaction Value
Yahoo! Shopping ― Transaction Value Others Yahoo! Premium members Transaction value generated by Yahoo! Premium members approx. 72% FY2016 FY2017 2Q 3Q 4Q 1Q 2Q 30
Slide 31: Commerce Business
Commerce Business Membership Shopping Auction Financial & Payment 31
Slide 32: Auction-Related Transaction Value
Auction-Related Transaction Value (¥Billion) 221.2 Expanded 212.1 170.3 192.0 203.2 steadily FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q 32 Note: Includes transaction values of: YAHUOKU!, tradecarview (https://www.tradecarview.com/), BOOKOFF Online (http://www.bookoffonline.co.jp), Yahoo! Tick
Slide 33: Measures Linking YAHUOKU! and Yahoo! Money
From February 2017, Began Measures Linking YAHUOKU! and Yahoo! Money 33
Slide 34: Usage Trend of Yahoo! Money in YAHUOKU!
Usage Trend of Yahoo! Money in YAHUOKU! Rapid increase in the balance of Yahoo! Money Aiming to increase its use as a method of payment Receipt Payment Balance of Payment in Yahoo! Money Yahoo! Shopping, etc. is increasing 34
Slide 35: Campaign for YAHUOKU! Sellers
Campaign for YAHUOKU! Sellers Max. 14% T Points provided(*) if Yahoo! Money is used for receipt of proceeds and payments 35 * Rewarded only during the campaign period. Please refer to the campaign website for details (https://auctions.yahoo.co.jp/topic/promo/sell_pointback_cp/).
Slide 36: Commerce Business
Commerce Business Membership Shopping Auction Financial & Payment 36
Slide 37: Number of Yahoo! Wallet Accounts
Number of Yahoo! Wallet Accounts (Million) 38.14 Record 34.89 high 31.97 27.72 25.19 (end of month) September September September September September 2013 2014 2015 2016 2017 37 Note: Yahoo! Wallet is a payment system which uses Yahoo! JAPAN IDs and passwords for authentication. It enables users to
Slide 38: Yahoo! Wallet Transaction Value
Yahoo! Wallet Transaction Value (¥Billion) 315.9 YoY 134.1 151.9 187.4 279.0 +13.2% FY2013 FY2014 FY2015 FY2016 FY2017 2Q 2Q 2Q 2Q 2Q Note: Yahoo! Wallet is a payment system which uses Yahoo! JAPAN IDs and passwords for authentication. It enables users to make payments for services and merchandise 3
Slide 39: Number of Valid Credit Card Holders
Number of Valid Credit Card Holders (Million) 4.12 YoY 1.41 2.83 Approx. 1.5 x (end of month) September September September 2015 2016 2017 39 Note: Number of card holders who can purchase goods and receive services, etc., using the card. Includes card holders of KC Card, Yahoo! JAPAN Card and SoftBa
Slide 40: Credit Card Transaction Value
Credit Card Transaction Value (¥Billion) 221.3 YoY 118.8 Approx. 1.9 x 41.8 FY2015 FY2016 FY2017 2Q 2Q 2Q 40 Note: Excludes cash advance service. Includes card holders of KC Card, Yahoo! JAPAN Card and SoftBank Card (“Omakase charge”).
Slide 41: Technology
Technology 41
Slide 42: CTR of YDN on Smartphones
CTR of YDN on Smartphones Continuously increasing 0 April April April April April 2013 2014 2015 2016 2017 42 Note: YDN on Yahoo! JAPAN services offered through smartphone applications and browsers
Slide 43: Various Measures to Improve CTR of YDN
Various Measures to Improve CTR of YDN Improvement in accuracy of CTR prediction 1 Introduction of a prediction model which eliminates impacts such as ad positions, and takes ad clickability into consideration Use of heterogeneous data mixture learning Improvement of targeting accuracy by combining
Slide 44: Supplemental Information
Supplemental Information 44
Slide 45: Business Segment Breakdown
Business Segment Breakdown Media Business ・Advertising: Paid search advertising “Sponsored Search”, Display advertising (“Yahoo! Display Ad Network (YDN)”, “Premium Advertising”) ・Business Services: CRM-related services, Media-related services and others ・Personal Services: Website production-relate
Slide 46: Advertising Products
Advertising Products Main Main Fee Placement Advertising Products Advertiser Format Calculation Pages Base Paid search Search results Sponsored Search® Text Major advertising pages Per-click rate corporations (Performance-based) *2 Text Yahoo! Display Small and Banner medium-sized Ad Network YDN and
Slide 47: Organization Chart of Yahoo Japan Corporation
Organization Chart of Yahoo Japan Corporation President & As of September 30, 2017 Representative Director SEVPCO / COO / CEO Marketing & CTO SEVPCO / CFO Communication Division (Chief Technology Officer) Board of Directors Audit and Supervisory ID Services Management Creator Strategy Office Corpora
Slide 48: Consolidated Subsidiaries and Affiliates
Consolidated Subsidiaries and Affiliates Major consolidated subsidiaries (As of September 30, 2017) ASKUL Corporation Carview Corporation Dynatech inc. eBOOK Initiative Japan Co., Ltd. ecohai Co., Ltd. FirstServer, Inc. GYAO Corporation IDC Frontier Inc. Ikyu Corporation Netrus
Slide 49: Corporate Governance System
Corporate Governance System General Meeting of the Shareholders election dismissal election dismissal election dismissal audit, etc. Audit and Supervisory report Directors Committee Members Audit and Supervisory Committee report Account Auditors Board of Directors election/ report give dismissal adv
Slide 50: 50
50