Yahoo! Japan: Mobile Boosts Revenues Across Advertising, Commerce Businesses

+29.36%
Upside
5.03
Market
6.51
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YAHOY: Yahoo Japan Corp ADR logo
YAHOY
Yahoo Japan Corp ADR

Yahoo Japan Corporation (OTC:YAHOY) reported its fiscal Q1 results on July 28. The company reported that its revenues grew 4.1% year over year (but a 4.5% decline Q-o-Q) to ¥212.73 billion ($1.91 billion). Additionally, operating income grew by 2.2% y-o-y to ¥52.2 billion ($470 million). Mobile revenues continued to boost overall revenues during the quarter as consumers increasingly used smartphones for shopping and browsing. The key takeaways from the earnings are as follows:

  • Mobile transactions accounted for over 52% of the company’s transaction value for the quarter. Furthermore, the increasing penetration of mobile devices aided in the growth of mobile ad revenue, as the smartphone revenue ratio continued to exceed 54% and contributed ¥38.6 billion (54.8%) to ad revenues. The company is increasing its content, especially video content, for the mobile platform. As a result, 66% of Yahoo! Japan’s daily unique users use mobile phones (60.29 million). The company will likely be able to leverage its position in the Japanese Internet landscape to drive mobile revenue growth in the coming years.
  • The company’s transaction value across the shopping, auction, and listing businesses grew by 16% year over year to ¥498 billion ($4.48 billion). A successful collaboration with Softbank helped the company to post 40% growth in its shopping transaction value to ¥140 billion ($1.26 billion). Additionally, with an increase in the number of stores (store ids grew by 32% to 558,140), the number of products listed on Yahoo! Sites swelled to 290 million (28% growth). Since online sales only account for 5% of all retail sales in Japan, the untapped market for the company presents a huge opportunity to grow its business in the coming years.
  • In Q1, the credit card transaction value for the company increased by 104% to ¥211.9 billion ($1.90 billion) as the number of valid card holders increased by 50% to 3.82 million. The number of Yahoo Wallet Accounts (37.32 million accounts) and transaction value (¥321.8 billion) also grew during the quarter, signaling strong adoption in the Japanese market. This translates into ¥861 per account, up from ¥823 a year ago. We expect this trend to continue in the coming quarters.

See our complete analysis of Yahoo! JAPAN here

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