DeNA Co., Ltd. (TYO:2432)
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May 7, 2026, 1:45 PM JST
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Earnings Call: Q1 2025

Aug 8, 2024

Speaker 1

Hello, everyone. Thank you for joining us for our presentation of the operating results briefing for the first quarter of fiscal year 2024. As it is the first quarter, my presentation will be brief. First, I will start with our financial results summary. Revenue was JPY 34.0 billion. We had an IFRS operating profit of JPY 1.9 billion. We had a non-GAAP operating profit of JPY 2.1 billion. That non-GAAP operating profit of JPY 2.1 billion is a year-over-year increase. This is an important takeaway. Next are the financial results by segment. Rather than going into detail now, I'll explain further during the individual business sections later and reflect on each business. Here is the cost and expense breakdown. The sales, promotion, and advertising expenses were up compared to Q4 of fiscal year 2023.

I'll explain more later, but this was due in large part to a major marketing push for Pococha Japan in the live streaming business. I think that's all for this slide. Now, I would like to discuss our progress for each business. First, the game business. In the game business, we already announced the significant downsizing of the China office in February 2024. That was a factor behind our Q4 performance and behind the Q1 profit increase year-over-year. Year-over-year, we went from JPY 0.2 billion -JPY 0.9 billion. Next is live streaming. For the live streaming business in Pococha Japan, we are enhancing new user acquisition through marketing with a media mix, including TV commercials, mainly in the first half of fiscal year 2024.

We are placing greater focus on profitability and continue to aim to achieve full year revenue and profit growth, as we have mentioned before. We are aiming for a buildup of profit towards the second half. I'll start with Pococha Japan. As I mentioned, here, we are currently running a strengthened marketing push, primarily in the first half, with the aim to spread awareness of Pococha and grow the user base. As you can see in the graphs, we have an increase in the monthly new user trend, as well as the overall monthly unique users and the monthly unique paying users indicated by the arrows. Since April, new user acquisition has seen a significant recovery, while existing user activity continues to be solid, leading to growth in both overall monthly unique users and monthly unique paying users.

We aim to continue to achieve growth in Pococha Japan with support from these factors. We had 6.08 million downloads in Japan as of June 30th, 2024. Next is another focus area, the service for VTubers, IRIAM. We have some great graphs on this slide. IRIAM achieved 3.49 million downloads as of June 30th, 2024, and continues to see active use. I've mentioned a few times that we are prioritizing sound community development, which is a core competence for us, while also aiming to achieve revenue growth and early profitability. Next is the sports business. As you can see from the graphs, we've had steady growth since the beginning of COVID-19, and we had a solid start for this fiscal year.

One thing to note about our performance is that we had one fewer game in this Q1 for professional baseball compared to last fiscal year. That being said, this is a good result. More specifically, the average stadium attendance for the 2024 professional baseball season is solid, trending at a higher level than last season. The average stadium attendance was 32,504 people through the end of June. For the basketball B. League, our second sports effort, the 2023-2024 season has ended, with attendance and revenue both seeing growth. We also had good attendance trends. Even within the sports business, this area is becoming more meaningful. Next is the healthcare and medical business. Due to the nature of this business, the full-year performance is what to look at.

KPI in each area were off to a good start for Q1 towards a year-over-year increase in full-year revenue and profit. Some financial contribution in both areas, originally expected in fiscal year 2023, is expected in fiscal year 2024 onward. Now I'd like to look at the individual areas. Within the healthcare area, the data use business is a growth area, and demand is weighted towards the second half for this business. Shown on the right, under the healthcare area KPI, you can see a comparison on a full year basis and see how we are outperforming in the most recent year compared to the previous year. The number of clients and other leading indicators are solid. We will do our best to turn these initial signs into finalized contracts that contribute to our results.

Further, for the data health business, since this fiscal year is no longer the Japanese government data health plan formulation year, we are running the business with a focus on greater cost efficiency. Next is the medical area. Here, our major subsidiary is Allm, and the main focus service is JOIN, which is the central axis from which we are expanding our business. We expect there to be acceleration in individual facility deployment in each region this fiscal year through various efforts, including support from the national government's medical digital transformation and working style reform initiatives. As you can see, we reached 514 facilities with JOIN deployed as of the end of June.

We are also making progress in detailed discussions for projects leveraging JOIN Mobile Care, which combines portable medical devices and JOIN to address regional medical resource shortages, with the aim to achieve contribution this fiscal year. JOIN will continue to spread, and as it does, so the uses of JOIN will also expand. We will also aim to secure some big projects, and in this way, grow this fiscal year. Q1 was a good start towards that goal. I have already shared our key focus for the next three years. Starting in this fiscal year, we aim to establish a group of businesses with structural and continued growth, and aim for each business to achieve meaningful profit contribution.

Of course, we will focus on increasing capital efficiency and ROE with consideration for capital cost, and as a result of our efforts, we have committed to achieving JPY 15.0 billion in non-GAAP operating profit for fiscal year 2026 through our business growth. If we have a major game hit, then that would be upside potential relative to our commitment. We have established the foundations for the sports in the community as well as medical, so we have expectations for growth. Our specific goal is to achieve the annual profit goals of JPY 5.0 billion for healthcare and medical, and JPY 3.0 billion for sports in the community over the next three years. Those goals have not changed. Based on those goals, our fiscal year 2024 consolidated financial results forecast is also unchanged.

The consolidated financial results forecast cannot be provided due to the difficulty of reasonably and accurately estimating the figures. We expect full year revenue to increase year-over-year in conjunction with changes to and strengthening of the business portfolio. We expect to have a non-GAAP operating profit with a year-over-year increase. This concludes my brief presentation for the first quarter of fiscal year 2024. Thank you for your attention.

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