Mixi Report: FY2013 Business Results

Key insights

6 takeaways

01
Monster Strike drove a major recovery in Q4 FY2014, generating ¥5,798 million in sales—a 143.8% increase—and contributing ¥990 million in operating income.See it on page 1
02
Mixi experienced an overall net loss of ¥227 million in FY2014, with net sales declining 3% to ¥12,155 million and operating income dropping to ¥480 million due to the decline of the legacy social networking segment.See it on page 1
03
The company is aggressively expanding Monster Strike internationally through a partnership with Tencent to localize the game for markets in China, Hong Kong, Macau, and Taiwan.See it on page 2
04
Mixi’s financial position was bolstered by a ¥6.5 billion public offering, improving the equity ratio to 84.5%, with a five-for-one stock split scheduled for July 1, 2014.See it on page 1
05
The 'nohana' photobook business saw a 16% increase in paid purchase rates, while the 'Find Job!' service maintained a stable user base of 700,000 members.See it on page 2
06
The company is actively restructuring its business model by pivoting away from traditional social networking toward higher-margin content, advertising, and life event services.See it on page 1

Summary

The FY2014 business results demonstrate a strategic pivot toward new growth areas after a period of declining sales and income. Net sales fell 3% from ¥12,632 million in FY2013 to ¥12,155 million in FY2014, while operating income contracted sharply from ¥2,574 million to ¥480 million, resulting in a net loss of ¥227 million. The decline is largely attributed to reduced performance in the traditional “mixi” social networking segment, which has been restructured toward network advertising and staff redeployment to higher-margin initiatives. In contrast, the Content Group’s flagship mobile game Monster Strike delivered a robust recovery: fourth-quarter sales rose 143.8% to ¥5,798 million, operating income reached ¥990 million, and net profit stood at ¥1,345 million. Monster Strike’s success is linked to aggressive marketing, including nationwide TV commercials and a focus on multiplayer features that encourage daily play among friends. The company plans to expand the game overseas, targeting China, Hong Kong, Macau, and Taiwan, with a partnership with Tencent to localize the service.

Other segments—Media and Life Events—continue to grow. The “nohana” photobook business achieved a 16% increase in paid purchase rates, while the “Find Job!” job-advertising service maintained a stable user base of 700 k members. Mixi’s equity ratio improved to 84.5% after a ¥6.5 billion public offering, and a five-for-one stock split is scheduled for July 1 2014. Overall, the report highlights a shift from legacy social networking to diversified content and advertising services, with Monster Strike as the primary catalyst for returning profitability.