Yahoo! Japan Earnings Preview: Sustained Top Line Growth Expected From Major Segments

+24.65%
Upside
5.22
Market
6.51
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YAHOY: Yahoo Japan Corp ADR logo
YAHOY
Yahoo Japan Corp ADR

Yahoo! Japan (OTC:YAHOY) is scheduled to announce its Q4 FY’17 (fiscal 2017 ends March 2018) results on April 27. The company has reported steady revenue growth from its core media and e-commerce verticals in recent quarters. The company continues to expand its services and footprint in the Japanese e-commerce industry, and strengthen its position in the Japanese online ad industry. We forecast fiscal Q4 net revenues to be up 5% to $2.1 billion (¥234 billion) with meaningful contribution from all revenue segments. We have summarized our expectations for Yahoo! Japan for the March quarter on our interactive dashboard platform. You can modify the revenue and net profit expectations for each division to see the impact on the company’s expected earnings for the quarter.

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Yahoo! Japan’s advertising revenues have been increasing for the past few years, largely due to the increased adoption of smartphones and the company’s hold in the Japanese smartphone market. For the March quarter, we expect higher mobile engagements and page views to continue to drive revenues. We forecast combined Media revenues to increase 5% y-o-y to $720 million (¥78.5 billion).

Similarly, Yahoo! Japan’s e-commerce businesses are also likely to benefit from continued expansion of service offerings in the mobile domain. Consequently, we expect the company’s transaction value across the e-commerce business segment to improve in the coming quarters. Additionally, since online sales still account for a relatively small portion of total retail sales in Japan, the untapped market provides a significant opportunity for the company to grow its business in the coming years. For the March quarter, we forecast e-commerce revenues to increase 8% over the prior year period to $1.4 billion (¥148 billion).

See our complete analysis of Yahoo! JAPAN here

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