CyberAgent, Inc. (TYO:4751)
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May 7, 2026, 3:30 PM JST
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Earnings Call: Q4 2023

Nov 1, 2023

Operator

Welcome to CyberAgent's full-year earnings briefing for the fiscal year ending in September. This session is being video streamed. With respect to the content we will be sharing today, please refer to the disclaimer that you will find in the presentation material. Our President, Fujita, will be taking us through the results. Mr. Fujita?

Susumu Fujita
Representative Executive Officer, Chairman, and President, CyberAgent

I will be taking you through the FY 2023 full-year results. Our fiscal year ends at the end of September, so this is the full-year briefing. In terms of overall sales, from 2021 onwards, fiscal 2021, we saw Umamusume big, becoming a big hit, and that had a great sales impact, but we have overcome that, and sales has continued to grow for the 26 consecutive fiscal years. In terms of the OP, we are on track.

With respect to the media business, ABEMA-related sales did well, so year-on-year, we saw an increase in 25.9% in terms of sales. In terms of OP, we did have significant investments in the World Cup, but despite that, we have seen improvements in losses. With respect to the ad business, we have outpaced market growth in terms of sales, and we have been able to expand market share as a result, and we have continued to invest in AI and DX actively, especially in the ad industry. And as a result, the OP is as you see here. With respect to the game business, in FY 2021, Uma Musume became a global boom, global hit, and it was a hit in FY 2021 and 2022.

In FY 2023, it became a normal hit from a super hit, and as such, sales and operating profit have decreased. In September, we released Final Fantasy VII, and this is doing well. It's have, we're seeing a great start, so we've seen impact from that as well. This is the full year results, expressed as a bar graph. We have continued to grow our sales, increase sales, especially with Uma Musume. Other businesses are also growing. With respect to the OP, FY 2021, 2022, it grew significantly, but as a backlash from that, we have landed this year at JPY 24.5 billion. In principle, we have continued to plant seeds for the future, and over the last three years, especially, we have planted many seeds to growth. So going forward, we hope to increase sales and operating profit.

The number of employees and SG&A expenses, as you can see in these graphs, FY 2021 onwards, after the Umamusume became a hit, of course, we significantly increased the number of employees and SG&A expenses average have continued. These are related to the investments in different businesses, and this will continue going forward. This is the PL, and the balance sheet. With respect to the FY 2024 forecast, as mentioned during last quarter's briefing, we want to ensure that the OP bottoms out in FY 2023, and going forward, we want to continue to increase sales and operating profit. And you see these, the phases divided into one, two, three, and four here.

But FY 2013 onwards, we have continued to increase sales and operating profit, but from FY 2018, we have started to make large investments in ABEMA, focusing not on short-term profits, but to nurture a big, big business. And then we entered phase III, where we saw a big, Umamusume becoming a big hit. And with respect to ABEMA, we invested in World Cup, planting different seeds, and in addition to that, especially in the ad business, we have been investing in AI and DX actively, and we have planted seeds in terms of, many game titles as well. And we have actively emerged into new fields, including the medical industry. So as I mentioned before, we have continued to plant seeds while we're doing well.

We are planting new seeds over the last couple of years, over this period, and going forward, we hope to reap benefits, start to harvest, and we have a clear outlook now, so we hope to continue to increase sales and operating profit steadily. Looking at the different businesses, first with the media business, ABEMA, we have made large investments, and now it's starting to enter the harvest phase, so it's easier to secure sales and operating profit. For FY 2023, we saw large investments in the World Cup as well, but this is going to disappear temporarily, so it is going to make the situation easier. With respect to the ad business, with respect to the business, we have continued to grow over the medium to long term, and we have continued to increase sales.

On the other hand, we have significantly invested in AI and DX over the recent period, and so we hope that we will be able to start harvesting, and we have started to also improve the operating profit, profit as well. With respect to the game business, of course, the existing titles, if they become a hit, it's easier for them to become, have a longer lifespan, and so that's a good trend for us. So we hope to make sure that we have a long lifespan for hit titles.

And also, we just released Final Fantasy VII, and next fiscal year, we will be releasing over three large titles, and these have not been included in the upside from the new games that we will be releasing will not have been included in the forecast, especially because we have revised the forecast downward last fiscal year. And so this is very conservative, and it doesn't really include the upside, but we are quite confident that we will see a bright future in terms of the game business as well. So in FY 2023, we want to make sure that the OP bottoms out, and we are going to commit to increasing sales and profit. We have successfully nurtured this thinking company-wide as well, so this is an area that we hope to continue to focus on.

This is the forecast. Moving on to the individual businesses, first starting with the internet, internet advertising. Over the mid to long term, we have continued to expand the market and have increased our sales steadily. In terms of OP, this decreased temporarily this fiscal year, but we have actively invested in new fields. In terms of OP as well, we have already started to make improvements in OP. This is the quarterly trends. As you can see, we are making steady growth. This is the OP. You can see the OPM here as well. We have started to improve OPM in the fourth quarter. We have started to see improvement already, and we hope to further improve the OPM going forward.

I have mentioned a couple times that we have been investing in the DX business, and we already have partnerships with 30 large companies already. So we are moving from the upfront investment stage to the growth stage, so we hope to start reaping benefits from our efforts. With respect to AI, especially in the ad business, we have already generated sales and results with AI, so there's not many companies that have done that. We have been ranked fourth in Japan, 49th in the world, as a leading AI research company. So we hope to utilize this as our competitive edge to produce even greater results. In Odaiba, we have launched a new creative studio using AI and CG. So this is a new studio that we have established, and this already has kicked into full gear.

So the creatives that we will be creating in the studio, we hope to utilize them as our competitive edge. Moving on to the game business. Umamusume was a big hit, and then it started to normalize, and after this process, the sales have gone down. Umamusume was our, is our own IP, and the profitability was very good, but we have seen the decrease in sales and OP as a result of that. If we look at the quarterly trends, so in the recent quarter, we've seen improvements in sales and OP. We just released Final Fantasy VII in September and summer events. These have contributed to the recent performance. And this is the OP. With respect to Umamusume, we are airing the season three of the anime series, and there are a lot of topics.

We're planting seeds for different, a lot of topics, and each of these are very high quality. We hope to transform them into a long-loved IP, and we believe that we are heading in the right direction. We start providing FINAL FANTASY VII EVER CRISIS. We -- it might not be as a big hit as Umamusume: Pretty Derby, but we have seen a good start. With respect to the next fiscal year, we believe that it will start to continue to our performance. Jujutsu Kaisen Phantom Parade will be released in late November this month, so we have high expectations for this title as well. Also, Cygames are developing console games, which we will be releasing this fiscal year, two titles for Granblue Fantasy. I personally believe that the quality is extremely high and have high expectations.

Of course, this has not been reflected in our forecast, but if these become hits, of course, they will be an upside. This is the release schedule going forward. Actually, we have been working on many console games, and in addition to that, of course, we have, at the same time, developed several big titles for smartphones. So we hope to release these games in a timely manner. Next, the media business. With respect to the media business, especially ABEMA-related sales, trended very highly, so we have seen great increase in sales. In terms of OP as well, although we saw investments in the World Cup, but we have seen improvements in losses slightly. This is the quarterly sales. ABEMA and media overall, of course, we've seen an increase in sales.

In addition to that, new consolidated company has contributed, and so we're seeing great results. Of course, ABEMA on its own may not be profitable yet, but as a media segment, we will soon see, we will soon start booking profits. This is the quarterly sales for ABEMA-related businesses. In the most recent period, we've seen related businesses as well as ads contributing to the performance. This is the trends in WAU. Of course, WAU target used to be 10 million, but 20 million is already within our sight. Especially, we had the World Cup broadcast, and this helped us increase the user base, but we continued to capitalize on this momentum. With respect to sports content, MLB and Premier League, we are strengthening our sports content, especially global football has been doing very well.

In order to enhance our content lineup, we are developing partners, so we are addressing this at the moment. Regarding anime, within the internet services, of course, ABEMA is a TV, so we provide our content for free, and if a new interesting anime becomes available, we can widely introduce that. We have focused on the fastest and exclusive premiere streaming of new animations, and this is an area that we are strengthening our efforts. Dramas and variety shows, and of late, of course, in the last quarter, we saw a program called Left Hiroyuki, Some In Some Corner of the World and Love Hyenas. They've generated a lot of buzz and became a great hit. GIRL or LADY , a new romantic show, of course, after it was aired, many people thought it was very interesting.

It spread by word of mouth, and the final episode that was aired this week, we saw many viewers, and the ratings were quite high. So we have continuously released many contents, many hits as well. And we have started to provide our content that content that we provided to Netflix. So dramas that we produced called Company Ain't No School or Who is a Wolf? have actually ranked third and fourth place, respectively, so we're seeing great traction. So through Netflix, we want to introduce and produce world-class content that people all across the world can see. And with respect to WINTICKET, it is continuing to do well. So our business will focus around ABEMA. Of course, we have ads and games, non-media businesses, but ABEMA media content that we have, we can expect various synergies with ABEMA.

So we would like to make sure that we can strengthen our collaboration with ABEMA. That is our key strategy, and we want to start monetizing this as well. Lastly, medium to long-term strategy. We have media, ad, and games, but we want to ensure that the OP will bottom out in FY 2023, and we are going to be committed to increasing sales and profit. We have continued to prepare to plant seeds over the last couple of years to do so, and we have a clear outlook now. We want to make sure that we're increasing sales and profits in each quarter and the fiscal year as well, and make sure that we can raise our somewhat sluggish share prices going forward. Thank you very much. That concludes my presentation.

We'd like to conclude CyberAgent's full year earnings briefing for the fiscal year ending in September. If you have any questions, please contact the IR team. Thank you very much for watching today.

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