FinancialGREE
FY2024 Second Quarter Financial Results
7 Feb 202456 pages~25 min full read
Consolidated net sales for Q2 FY2024 reached ¥14.2 billion with an operating income of ¥0.8 billion, meeting internal projections despite a 10% sequential decline in sales.
The Game and Anime segment revenue fell 11% to ¥10.4 billion due to the conclusion of anniversary events and title closures, though recovery is expected in Q3 via the Heaven Burns Red anniversary and Chinese market expansion.
The Commerce business achieved a 137% year-on-year surge in operating income, driven primarily by the adoption of SaaS solutions within the hospitality and restaurant sectors.
The Metaverse segment recorded a 119% year-on-year sales increase in the VTuber business and achieved profitability on the REALITY platform, though heavy investment in talent resulted in a divisional operating loss.
Management aims for the Metaverse segment to reach a break-even point by the end of the fiscal year, with a long-term operating profit target of ¥1.9 billion by FY2026.
The Investment business holds ¥83.1 billion in assets under management with ¥32.6 billion in unrealized gains, despite reporting a quarterly loss due to the timing of distributions.
Consolidated net sales for the second quarter of fiscal year 2024 reached ¥14.2 billion, with operating income totaling ¥0.8 billion. These results align with internal projections despite a 10% sequential decline in sales. Performance was primarily influenced by the Game and Anime segment, which saw an 11% revenue drop to ¥10.4 billion following the conclusion of major first-quarter anniversary events and the closure of specific titles. However, the company anticipates a recovery in the third quarter driven by the second anniversary of Heaven Burns Red and its strategic expansion into the Chinese market.
The Metaverse segment presents a bifurcated outlook, characterized by a 119% year-on-year sales increase in the VTuber business alongside profitability in the REALITY platform. Despite these gains, aggressive investments in talent expansion resulted in a quarterly operating loss for the division. The company aims for the Metaverse segment to reach a break-even point by the end of the fiscal year, with a long-term operating profit target of ¥1.9 billion by fiscal year 2026. Simultaneously, the Marketing DX and Commerce businesses emerged as significant growth drivers, with the latter achieving a 137% year-on-year surge in operating income fueled by SaaS solutions for the hospitality and restaurant industries.
The Investment business reported a quarterly loss due to the timing of distributions, yet it maintains a robust foundation with assets under management totaling ¥83.1 billion and substantial unrealized gains of ¥32.6 billion. While the company faces short-term volatility in its core gaming operations, the diversification into high-growth areas like digital transformation and commerce provides a stabilizing effect. Management maintains its full-year forecasts, banking on upcoming seasonal events and the continued scaling of its platform and service-based businesses to drive second-half performance.
