|Date||Friday, August 4, 2023 4:00 pm - 5:15 pm|
Junichi Miyakawa (President & CEO)
Kazuhiko Fujihara (Board Director, Executive Vice President & CFO)
At the earnings results briefing, Mr. Junichi Miyakawa, President & CEO of SoftBank Corp., discussed the consolidated results for Q1 FY2023.
Change in Segment Name
In conjunction with the start of its medium-term management plan, SoftBank Corp. has changed the name of a segment from Q1 FY2023. This change only pertains to the segment name, and there are no changes to the segment classification, scope, or measurement methods.
|Previous Segment Name||New Segment Name|
|Yahoo! JAPAN/LINE||Media & EC|
for Q1 FY2023
- Revenue for Q1 FY2023 was ¥1,429.7 billion, up 5% year on year. Revenue increased in all segments.
- Operating income was ¥246.3 billion, up 2% year on year. Progress was in line with the full-year forecast for actual profit growth in all segments.
- Net income attributable to owners of SoftBank Corp. was ¥146.7 billion, up 15% year on year.
- The progress rate for Q1 is in line with full-year forecasts, with a progress rate of 24% for revenue, 32% for operating income, and 35% for net income attributable to owners of SoftBank Corp.
Results by Segment
(1) Consumer segment
- Revenue increased by 0.2% year on year, while segment income decreased by 4% year on year.
- The decrease in mobile service revenue is on a narrowing trend. We are making steady progress toward mobile service revenue growth target for FY2024.
- Operating income progressed steadily toward growth on a full-year basis, with a progress rate for Q1 of 31%.
- Net additions of smartphone and main subscribers continued to show good performance, following the trend since the previous year. Also, cumulative smartphone subscribers increased by 6% from the end of the same period in the previous fiscal year.
(2) Enterprise segment
- Revenue increased by 4% year on year, and segment income increased by 8% year on year.
- Business solution and others revenue continued to perform firmly, increasing 17% year on year.
- Recurring revenue, which makes up more than 70% of business solution and others revenue, increased by 18% year on year.
(3) Media & EC segment
- Revenue increased by 2% year on year, and segment income increased by 31% year on year. A one-time gain on business transfer was recorded.
(4) Financial segment
- Revenue increased by 185% year on year. This increase was mainly due to the impact of the consolidation of PayPay Corporation. The segment loss in Q1 FY2023 was ¥1.8 billion. Assuming that PayPay Corporation had been consolidated from the beginning of FY2022, the profitability improved substantially from the segment loss of ¥5.2 billion in Q1 FY2022.
- PayPay Corporation
- Consolidated revenue*1 in Q1 was ¥48.0 billion. Consolidated EBITDA*2 was ¥1.7 billion. For the first time, PayPay Corporation achieved positive consolidated EBITDA in a standalone quarter.
- SB Payment Service Corp.
- Gross merchandise value (GMV) in Q1 was ¥1.9 trillion, up 21% year on year. Notably, GMV has been driven by the non-telecommunications area, which includes transactions outside our Group that increased by 29% year on year.
- Operating income increased by 15% year on year.
- PayPay Securities Corporation
- The cumulative number of PayPay point investment users surpassed 11 million.
- SoftBank Corp. was selected as a component of Dow Jones Sustainability World Index (DJSI World) for the first time.
- SoftBank Corp. achieved the highest score among the companies selected from Japan. It was the only Japan-based company selected for the “Telecommunications” industry.
Status of Corporate Financing
- SoftBank Corp. plans to issue Bond-Type Class Shares of up to ¥120.0 billion through public offering in Japan during FY2023 to strengthen its financial foundation for both growth investments and a high level of shareholder returns.
- There will be no dilution of the rights to vote as the holders of the Bond-Type Class Shares do not have the right to convert the Bond-Type Class Shares into common shares. As a result, the Bond-Type Class Shares will enable SoftBank Corp. to increase shareholder equity while taking into consideration the rights of existing shareholders.
- The funds raised through the Bond-Type Class Shares will be mainly used for growth investment that helps to increase medium- to long-term corporate value. The main areas of investment are expected to include generative AI, next-generation social infrastructure, and renewable energy.
Generative AI Initiatives
- We plan to develop our own homegrown generative AI with Japanese datasets, taking advantage of having “Largest Computing Platform in Japan”, “Abundance of Engineers”, and “Overwhelming Customer Touchpoints.”
- Collaborate with leading partners. Announced strategic alliance with Microsoft Japan Co., Ltd., a leader in generative AI domain, to accelerate DX for companies in Japan.
- While taking initiatives on in-house development of homegrown generative AI, we will also utilize multiple generative AI systems developed by partners.
- *1For PayPay on a consolidated basis (with each fiscal year including figures for 12 months). The figure is based on IFRS and is non-audited.
- *2For PayPay on a consolidated basis. EBITDA is calculated by adding depreciation to operating income (with each fiscal year including figures for 12 months). The figure is based on IFRS and is non-audited.
This presentation is not for the purpose of soliciting investment or engaging in any other similar activities in Japan or any foreign country. This presentation does not constitute an offer of securities in the United States. The Company's securities referred to in this presentation have not been, and will not be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration thereunder or an applicable exemption from registration requirements.