Ladies and gentlemen, thank you very much for coming or participating despite your busy schedule. We now would like to start Rakuten Group's Fiscal Year 2021 Q1 E arnings Results Meeting. We have disclosed the latest consolidated financial reports at 3:00 P.M. today. You can view this data on our corporate website's page for investors, along with the presentation documents that is used in this meeting. I'd like to now introduce the presenter, the Chairman and CEO of Rakuten Group, Mr. Hiroshi Mikitani, or Mickey. Mr. Mikitani, Mickey, please start your presentation on the latest financial results.
Well, this is streamed live. Ladies and gentlemen, thank you very much for joining us. This is the Year 2022 Q1 Consolidated Financial Results Presentation of our group. Now, today, I would like to speak on three topics. First, this year, we, Rakuten Group, celebrates its 25th anniversary, and based on that milestone, we're going to look towards 2030, which is eight years from now. What is the strategy towards 2030 is what I would like to talk about. Then, of course, the main topic of today, Q1 2022 highlights, and I will also talk about the progress in the different segments. Also, this morning, we made this announcement about Rakuten Mobile's new service, so I will explain that as well. First of all, the 25th anniversary.
As you can see, this logo, from red to green, this gradation of the color, this also signifies the sustainability of different forms, especially carbon neutrality, which is what we're aiming for, and we're going to take concrete measures towards carbon neutrality. In that sense, we have used this color, changing from red to green, and then , towards 2030, we have a long-term plan. The sales or the revenue will not be decelerated; it will grow, and the current operating income margin is 13.5%, but we target over 20%. If you do the math or the multiplication, you can actually guess what we're aiming for. Also, profitability or significant profitability for Rakuten Mobile and Rakuten Symphony is the third pillar.
Now, currently, we have a revenue of JPY 1.7 trillion as revenue, and of course, GMS growth is to be maintained at this very high level, and operating income margin. The profitable services that we are having already, where we are making further investments, about the average growth of the margin will be on average 20%. That's what it means. What is profitable now, we will make it even more profitable, and for the existing services in eight years' time, all the services will have this level of OI margin.
As for domestic EC e-commerce GMS already includes internet shopping, credit card, travel, GORA; all these actual transactions make up JPY 5 trillion already, but that will reach JPY 10 trillion or more. We are to be the largest distribution channel in Japan, and also a top player in the global market as well. For fintech credit card, we're by far number one already. As was already introduced, for Rakuten Bank, we're planning on listing it, going public, and I will come back to this later, but Triple Three is what we're targeting, and that is our big target for the card. We think that there will be tremendous contributions made to the revenue and profit. Mobile and Symphony, we're trying to make profits as well.
The overall mobile strategy, the details will be covered later, but basically, mobile subscription will increase. That means more profits for us. Towards the Rakuten Group, there will be higher levels of loyalty. For example, the Rakuten Mobile subscribers will make actually purchases on Ichiba, a 70% increase is expected. That is what we're looking at. Let me go into the main part, which is the highlight of the earnings.
This is a major KPI, global GTV. Comparing to the last year, it grew by 21.9%, almost 22%, and then we reached JPY 77.3 trillion. Domestic e-commerce GMS, they grew 15.9% in two-year CAGR. 2020, comparing to Q1 2020, we have grown up to this amount. The consolidated revenue hit JPY 437.1 billion, up 11.7% or 12% year-on-year. The non-GAAP operating income, excluding mobile logistics investment business and adjustment, reached JPY 46 billion or 8.5% Y-o-Y growth. We are growing, and that's why we made this 8.5% Y-o-Y growth. The Rakuten Card, particularly this Golden Week.
It grew more. As for this quarter, we reached JPY 4.1 trillion, or 26.1% Y-o-Y, and the cardholders topped 26 million. Rakuten Securities now has the largest domestic volume of 7.7 million accounts, and Rakuten Bank accounts reached 12.3 million. These are the major KPI of our business. On top of these stand-alone KPIs, what about the synergy we see today? As you can see from this graph, over the month, the number of users using at least one of the Rakuten Group services, it went over 36 million. Compared to the year before, it's 11.2%. Therefore, we made a large growth here.
On top of this, the usage of more than two services is 74.8%, the ratio of users of two or more services here. The largest tool to encourage this is the Rakuten Super Points and Rakuten Points. It's about JPY 530 billion, and we made issuance of this for the points. We don't know about other companies' points program, but 90% of the issued points were being used. It generate a huge amount of benefits to this business, and it make our Rakuten ecosystem popularity more and more. The Rakuten's points program is very unique. For example, SPU, by using various services, the shopping at Rakuten Ichiba, you can gain more points. That is one example.
Offline, such as Rakuten Pay and the other services included. Rakuten Points related, the payment is available, which is about 60 million different locations. You can use the Rakuten Points for that. Not just holding the points, but also you can make some investment with those points. With Bitcoin, you can purchase such a cryptocurrency with points. We are going to provide more innovative services in this area. Okay, now let's dive into more detail for each business, starting from the internet services. Domestic e-commerce GMS, 10.3% and JPY 1.3 trillion. The revenue, JPY 182.5 billion. It's 11.9% year-over-year, or 12%.
Then non-GAAP operating income, which is JPY 21.5 billion and is 77.3% Y-o-Y growth. Let me see the breakdown of this. As you can see from this, the graph, the marketplace business such as Rakuten Ichiba and Travel and GORA, it's about JPY 2.7 billion OP contribution. The fundamentals is improving, as you can see. What about other vertical or the similar services? How are we different from them? For example, Rakuten Ichiba and other retailers may be having a difficult time. Comparing to that, we grew by about 80.7%. If it comes to the travel, unfortunately, because of the pandemic and a lot of other problems and, travel or the overall travel industries, GTV was about minus 85.4%. However, we kept flat.
April and May, it's growing rapidly. The netsuper, the retail businesses. Comparing to conventional players, we grew our businesses, and also to the Rakuten Fashion or the existing boutique or the super. We made the 40% growth. As for the Japanese fashion industry, we are able to contribute on top of that. There are various services. Synergy among different services are growing, as you can see from here. For example, Rakuten and Rakuten GORA, and buying the golf items on Rakuten Ichiba, and other items to be purchased on Rakuten, and make a reservation via GORA. We see 15% growth here. As for the online supermarket, it's grew by 50% overall.
Hair salon, Rakuten Beauty, the 23% grew. As for Rakuten Travel, 43%. Well, last year, I think we were quite behind. Also Rakuten Fashion, 14.2%. The Rakuten ecosystem or Rakuten economy is getting rooted, and then those who are living in that ecosystem is increasing. That's how we interpret this. Other than that, we started the new things. For example, today eco is the very important, so the circular economy is often referred at that. Rakuten Rakuma, so C2C trading platform, we made a huge growth at the C2C platform. In addition to that, we will be providing B2C, and then they will not go to the merchant of the Rakuten Ichiba. However, they want to sell their items to consumers.
Also we branded, and then we check their credit and do some transaction based on that. For the Netsuper, overall 24.1% growth we made.
This is available from the Seiyu store, and also we have a dedicated semi-automated, the online store delivery that is about 70% growth. Now we have multiple logistics for online supermarket. It's being newly constructed, and this is the nationwide supermarket, and other supermarket can use those logistics. Prefer non-Seiyu brand or the region where Seiyu has no access. Even in those location, we can have our net super available to the consumer. Those area we will be focusing on today. Rakuten's original philosophy or the purpose was to empower the local economy. I will not say all, however, in many prefectures or city level or the town, we have some partnership or alliance. This is about a comprehensive cooperation agreement with many local governments. It's not just for the shopping, payment.
We want to reactivate the local economy. That is our local strategy. Other internet services, Ukraine, it's very sad thing happening today in Russia. Actually these two are large market provider and the number of users has been increasing. However, there is no situation for us to have an advertisement. Therefore, that had a negative impact onto here. The point cashback business, and it's growing. We did some active marketing here. However, comparing to the year before, we see JPY 622 million year-over-year improvement. Comparing to one quarter before, we see some short drop, but it's under manageable thing. Next is Fintech. There's an obvious growth here. Revenue grew by 5.4% year-over-year, non-GAAP operating income plus 4.8%.
We are actually growing so much. We are by far number one already at this time already, but we are going to be ahead of others furthermore. Rakuten Bank accounts 12.3 million surpassed. Rakuten Securities accounts surpassed 7.6 million. Rakuten Card again was 26 million or more. 71.2% of the people actually use all of these services. 71.2% of the people use all of these services, so they're cross-using them. Triple Three I'd mentioned already in relation to Rakuten Card. Card issued 30 million, shopping GTV JPY 30 trillion, and GTV share 30%.
It's already approaching 27 million in terms of the card issued. I think the first 30 million, the first target is within our reach. Thirty trillion JPY shopping GTV from the 14.5 trillion JPY you might think that this is ambitious, but digital payment ratio is increasing. QR codes and other payment methods do exist, but when it comes to large amounts to be paid for dining out or others, credit cards are still being used, and that will hold true into the future as well. I think with digitalization progressing in Japan, we think shopping GTV reaching 30 trillion JPY will be reachable.
Once that is achieved, 22.4% market share that we have right now will likely reach 30% in terms of the GTV share. Rakuten Securities is next. On a standalone basis, yes, the total number of accounts is the largest number. I think that's our estimate. We're going to increase the accounts and also the amount handled will be, or the transaction will be increased as well. Investment trust and other products will be enhanced further. Foreign exchange things are getting better as well. Of course, there are different customer surveys done, but many customers, when they are surveyed, select us, and we're therefore the best selected number one securities company.
When it comes to contents and high speed, ease of use, UX, user experience, we're making improvements in that, on that front as well. Rakuten Insurance, life insurance, general insurance, pet insurance included, we're collaborating with different group companies. For example, travel insurance, and when people purchase items on the Rakuten Ichiba, the guarantees given to the purchased items, and also card ancillary insurance, among others. In other words, these really maximize the Rakuten ecosystem so that we will go further into the insurance segment. In addition, a drone appraisal to appraise the level of damages done is another service. Something that only AIs can do, we are actually incorporating into our businesses.
Payment, OMO, online merges with offline strategy, is actually paying off, especially together with Seiyu, into which we invested 20% of the stake. We are conducting a demonstration and things are actually happening, and it's accelerating so much. Once this is successful, we will actually team up with other distributors, and I think the e-commerce in Japan compared to the US or China is much smaller. However, I think OMO strategy will bridge the gap, and have potential for further growth. Fintech has to do with circulation of money, and I think things can be handled within the Rakuten Group. More than JPY 7 trillion, I think, is already achieved.
For example, cash advances of credit cards or other services, self-funding can be done within the group, within this ecosystem. Again, this is unprecedented, unique to Rakuten Group, and this is really our strength. Let's move on to mobile. As explained, the first of all, the domestic mobile business and the Rakuten Group's various diverse service synergies to be pursued, and then also the software platform business, Rakuten Symphony's global business deployment, these are the three pillars. This is a triple strategy that we will be aiming at. Then the employees' efforts and your support, we increased the number of base stations, and as of April end, we have more than 44,000 bases.
Then Casa femto at home or the restaurant inside the building and the stores, we have about 80,000 Casa installations finished. Our network is available anyway, anywhere, then initially, we had a 30%+ in KDDI roaming, and now it become lower than 10%, and it will contribute lowering the cost drastically at the same time. We had the KDDI 5 GB partner line, and then after that, it will go down to 1 Mbps. Well, this will continue, of course. However, the much faster network or much faster download speed and much faster internet access will be realized. That will contribute pushing up the usability. With that, Rakuten Mobile, an application has been accelerated. Looking back, what about the speed or velocity of this?
The Rakuten Card, well, when we started Rakuten Card, it was to reach the five million. It took 73 months to reach five million. When it comes to the Rakuten Mobile, it was only 26, 25 months. More than at the triple speed, we have been accelerating the subscriber number. As we keep this trend, speed trend, and then the Card, we can reach 20 million subscribers much faster than the Rakuten Card. How many Rakuten ecosystem users are using this Rakuten Mobile? Well, 11.3% of the active users subscribe to Mobile. In other words, 88% of the users may join Rakuten Mobile subscription, and we have other subscriptions outside. We are quite optimistic about the user subscription.
I will explain later this about the that we have announced a new pricing plan today, and that is one of the things, and also the roaming. If it becomes unnecessary in order to reduce cost, we will switch to our own network, and then this quarter probably will be the bottom of the loss, and we will start improving from here and make profit. Now that scenario is seeable. For example, as of end of June, what we started, like a one-year free plan or three-month free plan, and then when I made a press conference this morning, and we will hold this at a free of charge the plan. However, as of the end of June, 100% of the users will become chargeable users.
Data usage, will it be increasing or the ARPU, will it be increasing at least? The Rakuten dedicated, the line area compared to the previous year, the number of customers on average data volume has increased by 40.8%. This is average, if it grows, and then our upper limit is JPY 2,980 today. But if everyone becomes to this band and also subscribe to optional services such as unlimited call services or plus alpha support services, if that happens, then it will push up the ARPU. That's our assumption. To be specific, let me talk about this new pricing plan. So far, from the 0-1 GB, we had the JPY 0. That is a marketing strategy.
It was because of the pandemic, we have to support the people struggling in that period. The mobile network, mobile service, democratization is the point or the mobile, the business democratization. Expensive is not good. That was our basic policy. That's why we provided this, the plan. However, the network quality become better, and then we have coverage almost completed, including, my friends said, Rakuten Mobile is accessible, it's the least expensive. Is it okay only paying for that amount? Those who have more than two devices, that they started to use mainly Rakuten Mobile only, or at least use it as primary devices.
That case is increasing, therefore, we have announced this UN-LIMIT VII , and then the until 3 gigabyte it's JPY 980, and then even it becomes the unlimited before tax JPY 2,980. The 150 gigabyte or 200 gigabyte, I think these users would start using those volume. Even they use that volume, we see this at a cost advantage and that this is quite compelling pricing strategy. Having said that. The pricing plan until the. We are shifting to this other plan, so the essentially four month free, for the fee up to 1 gigabyte. We have the cashback, for the first two month, and the next two months, including the consumption tax point back, either way we reward to the customers.
On top of that, we will provide additional extra services, for example, Rakuten Ichiba shopping at maximum, you will get the 6x points back. The usual phone call, not using the link, the three months free is available, and also various digital services, digital content services, our services and third party services. Essentially, those services will be free for three months. That is how we are going to do. For example, the shopping six points, six times points back, this will start from June 1st. If you use Rakuten Mobile, you will have additional points. If you are diamond members, you will have another points. At maximum you will get the six times point back. The super sale or other SPU program.
With those program, the more you use Rakuten Mobile, the more benefits you can enjoy from the Rakuten Ichiba services and also the Rakuten Group content services, for example, Rakuten Magazine, 31 days free, and Rakuten Music, 90 days free, and Rakuten NBA. Well, new NBA championship will start and in coming fall, Golden State will return, and Washington Wizards three match will be held here in Japan. You can enjoy the NBA Rakuten three month free, and then Pacific League Special, also three month free. These are additional contents we provided. We received a huge request or need from the consumers, and that is Rakuten Mail or Carrier Mail, and this will be starting from July 1st. This is a plan basis, and this is free of charge. Email address portability will be started from August.
Rakuten Link, well, it is highly appreciated by our users, and using Rakuten Link to send and receive emails, it is possible now. From business point of view, in addition to this, we will start enterprise services. The Rakuten Group. The Rakuten Ichiba service, I think we created more than 1 million employment opportunities. The number of enterprises for the transaction, we have the 400,000, or at least one quarter is for Rakuten, and that is the basic answer from these other existing clients. Given that size for this, the enterprise services, we expect many companies to join, and then the benefits we are going to provide, for example, if you use Link to make a phone call, it will be free.
Also, if you make international calls, if you use Link, it will be free. That is another differentiation factor.
In relation to that, we have a twin service, so to speak, that is Rakuten Symphony. This is attracting attention from around the world, the biggest kind of attention. Of course, we have this war in Russia or Ukraine, and people are now talking about security. Especially the free world is talking and focusing on security, and Rakuten Symphony in that regard is attracting attention. I think we are one of the companies that are drawing the largest attention. 3,500 engineers are involved. It's not a small service that we're providing. It's something that is like a infrastructure, which is now the nature of mobile network.
We are the only, I mean, Rakuten Symphony is the only one that realizes that. How big is the market? Well, basically, it's huge, massive. By 2025, the so-called total addressable market, TAM, is considered to be $120 billion, about JPY 15 trillion that would be. Finally, I'd like to talk about overseas and contents business. Things are progressing very steadily, especially Rakuten TV in Europe. Different smart TVs are actually shipped with Rakuten TV channel. Already, 52.6 million people use this service. Year-on-year growth 82.5%. Multilingual streaming service is provided through Rakuten Viki, and that is 56.2 million. Rakuten Kobo, 57.2 million. Rakuten Viber, 1.345.
Rakuten Rewards, this is an e-commerce in the United States, already $2.491 million. $2.4 billion, that is. 10% year-on-year growth. The brand awareness of Rakuten is expanding as well among Japanese Corporations. We're a global company, extending business on a global scale, or capable of expanding our business globally, and we are one of the few such companies. 83.7% awareness in Taiwan, 70.1% in the U.S., Spain 80.8%, France 84.1%, in Canada 66.1%. Again, the logo or the brand awareness is increasing.
I'm sure that in East Europe, including Ukraine, through our social contribution that we extend in the world, the awareness level is increasing. This really concludes my briefing on the Financial Results of Q1 Fiscal 2022. In a nutshell, we announced this new plan for Rakuten Mobile and digital content services. All of these are bound to grow, and they will grow, and we hope that you will have high expectations for that. JPY 980 is the amount that we would charge some of the users that would actually, of course, push up our financial base as well as help us build a better network.
Synergistic effects as well as synergistic effects and improved services will come out of that effort. Of course, the economic surroundings has uncertainties, but we will make our utmost effort despite the current situation. I hope you will support us in that effort. Thank you.
This concludes our 2022 Q1 Fin ancial Result Presentation Session. Thank you very much.
We have the management team here ready to answer your questions. Please allow me to introduce them. Hiroshi Mikitani, Kenji Hirose, Masayuki Hosaka, Kentaro Hyakuno, Kazunori Takeda. These five executives on the stage. Next, I would like to explain about today's Q&A process. This Q&A session will be conducted using simultaneous English and Japanese interpretation. Please select the language you would like to hear in your audio feed from the Zoom nav bar at the bottom of your screen. Please do not select mute original audio. When the interpreter speaks, the original volume will be lowered, and you will hear the interpreter's voice overlaying the speaker. The presentation materials shown have been aligned with Japanese. If necessary, please download the presentation materials from the investor page on the corporate site.
We'll start by taking questions from the media for the first half of this session, and then we will take questions from investors for the rest of the hour. Please raise your hand to ask a question. For those joining from their PC, beneath the participant gallery view, you will find the Zoom navigation bar, and please click raise hand to ask a question. If you're joining from your mobile phone, please tap More and then tap Raise Hand in order to ask a question. If your name is called, please make sure your mic has been unmuted before asking your question. If you are joining by phone, please tap the star key followed by nine to raise your hand. We will unmute you so that you can ask a question after your name is called.
You can also inquire by Q&A form at the bottom of Zoom screen. Please note that we can only accept questions regarding the financial results. In order to answer as many questions as possible, we ask that you please keep your questions up to two questions per person and ask them both at one time. If you have any question, please raise your hand. Yes. From Yomiuri Shimbun, Ichikawa-san, please ask your question.
This is Ichikawa of Yomiuri Shimbun is speaking. Thank you very much for your press conference this morning, too. As you explained in the presentation, I have a question about new pricing plan. At this timing, you will start this new plan. Why? This is my question. Because less than one gigabyte free, and you stop it, and then that will contribute to the revenue.
I assume it will not be a big contribution. That's my assumption.
Still you are increasing your subscribers, and then I think you can prioritize to increase the number of subscribers over the pricing plan. I would like to know the reason why you implement the plan at this point in time.
I'm repeating what I've said in my presentation. Unlimited high speed available network and 97% coverage is already complete. We increased our service level. That is the fact and understanding by us. Until 1 gigabyte, and this is the 0-1 gigabyte is very featured. However, you have more points, and also you have the unlimited calls, and you are available to access the various contents. We have added a lot of benefits. Those are the two things. I think these two are on par if we make a comparison.
As for the revenue contribution, in order to increase the ARPU, yes, it will be contributing. I cannot come up with quantified number, but as for the revenue contribution, it is quite a big portion with this plan. We say this, we started from the one year free and then down to three month free, and now this new pricing plan. Every time we launch this program, we had some impact for short term. As long as we provide better services, we can charge the appropriate pricing accordingly. At this level, we provide a competitive service to the market. I believe our subscribers would understand it, and I don't think the slowdown of new application would happen.
For the Rakuten user, I mentioned 11% is subscribers to the Rakuten Mobile, but we can increase this to 20% or 30%. That is another strategy. The appropriateness, well, we cannot provide free of charge forever. We need to make a decision at some point in time. Now we have the coverage of 97% and closer to 99%, and I think this is a good milestone for us to change the gear. The revenue generated from here can be invested into the improvement of the quality of the network so that we want our users to satisfy with our services.
Thank you very much.
Okay, I'd like to move on to another question of NewsPicks, Mr. Hatani, please.
Hatani of NewsPicks speaking. I have two questions. In the presentation, you mentioned this as well, but travel and sports business were hit by the pandemic. Now, the financial results doesn't really include that, but we had the Golden Week without any travel restrictions, and also sports is also another area. What is your prospect for the annualized full year performance and also long-term business plan? I think you're going to increase revenue as well as the 20% you know margin and so forth into JPY 10 trillion. But what is the most challenging part of what you have targeted, and where do you focus? Those questions, please.
Takeda in charge of commerce. I'd like to answer the travel question. Now, as you know, for travel, because of the COVID-19 pandemic, that segment was hit hard, especially online travel reservations. However, was relatively steady. There was this shift from the real physical travel to online travel. We caught these customers. Now this year, the quasi-emergency status declaration was lifted, and for the Golden Week holiday season, it was actually beyond the 2018 level. It was almost close to 2019 level. As you know, 2019 Golden Week was 10-day long, very long holiday season. This year, it was quite close to that, and the performance this year was quite close to that. Not quite, but close to that level. I am in charge of sports.
Let me address that question. My name is Hyakuno. Sports, whether it is baseball or soccer, there's no limit as to how many people in the stadium can attend or watch, especially baseball home game. For the first time in 947 days, we had a full stadium. I think we are going back to what it was, how things used to be. We are going to bring the situation back to the 2019 level for baseball as well as soccer. I hope you will look forward to that normality coming back. 2030, well, you asked which part is the most challenging. Well, at cruising speed, this is what is expected, and that's what it means in this presentation.
For example, you see, GMS, domestic, travel included as well as others. They are all included in this figure. I'm sure that people will buy more online, and JPY 10 trillion, when you think about the level overseas, maybe that level of JPY 10 trillion is rather valid. Twenty percent or more for the margin, operating income margin. When you think about the mobile and Rakuten Symphony
I'm sure that they will be making a certain level of profits by 2030, which is 8 years down the road. I think that's quite possible. The 10% or plus, which is the current growth rate, we would like to, of course, continue that. This year 11.7% is the growth rate, so more than 10%, a little more than 10% growth rate. When you think about the Rakuten Group, we have a very rare ecosystem in the entire world, AI, data, which will be used further. I think they will really support all of the businesses that we, or the services that we provide. The level that I have presented, I think is the minimum that we aim for. Thank you.
Thank you very much. Thank you.
Let's move on to the next question. The next question is from Asahi Shimbun, Konoya-san, please.
Can you hear me? Yes. Konoya from the Asahi Shimbun. The outlook or forecast. This time, mobile, the loss will be the peak and it will be bottoming out. The outlook for full year forecast, full year, well, you did not disclose any specific numbers, and then the peak of loss will be this quarter. What is the reason behind it? That is my first question. The second one is about the point program.
The volume PayPay, although this is other company, well, last month, well, they started to sell the point outside of the company, and the next year they didn't name anyone, but the point issuer is number one, maybe you, and they are going to surpass you, and that was how they explained. You well revisited various programs and some of the services were withdrawn. Do you see them as a threat? What would be the direction for the future? Could you just share your thoughts? Could you go back to the slide, previous page, mobile page.
As explained in my presentation, and basically, well, we will have more chargeable users, and then the roaming cost will be drastically reduced. It's reduced drastically. That is the reason behind.
Two-year, very short term, we launched this service within the very short term of the two years. Comparing to other companies, we incurred the large cost. However, we can reduce the cost in many areas. That's how we see. This is the peak of the loss, and I think it's the final loss. I'm not in the position to make a comment about other companies' services. Including the company name you mentioned, everyone is hard-working very hard. Maybe it's grow or not grow. It's uncontrollable from our company, but at least within the existing situation, I think we are in a good position. We will be more efficient and very fair through the cash back or point back program. We want to be fair and efficient.
That's all from me. Thank you very much.
Thank you. Next question is from Toyo Keizai, Nakagawa-san, please.
Nakagawa of Toyo Keizai Shimbun Newspaper. Can you hear me?
Yes, we can.
I have two questions as well. Related to the point question, 2030 target, 20% OI margin to be achieved, and point issuance is increasing year-over-year. Now, when you think about keeping the profitability as well as enhancing loyalty of the customers, you want to do both. How is that going to affect the pace at which you issue points? What is your current plan on the pace of issuing points? Another question is, you didn't talk about this today, but the advertisement business is growing as well. The OMO strategy also has to do with or can be linked to the marketing or advertising business potentially. Maybe third-party cookies will no longer be available, but then Amazon is growing.
I think advertising is a potential promising area for you as well. What is your take on that?
For advertising, I'd like to answer your question. As you said, yes, advertising business in different forms today, we are growing that business. GMS especially is growing, and in accordance with that growth, advertisement revenue is
Being attained or growing. When GMS increases, there will be additional advertising business coming our way. It's a virtuous cycle generated. Especially, we are strengthening collaborations with other brands and vendors, and so we are working with them in this regard. In terms of systems as well, the charging made easy for advertisements to be issued and published, we are providing such a service or system, and that is also helpful. Therefore, advertising and distribution or retail linking with each other, collaborating with each other for further growth is what we would like to see happen. As of now, point is at the very center of what we are trying to do.
Well, we are doing things in a more general way, so to speak, but we will make it more personal. Usability, for example, is one focus. Let's say somebody purchases in Ichiba, but they're not using Rakuten Travel or has been away from Rakuten Travel for some time. We want to approach them, and we want to come up with the best possible approach to these people. I think mobile will be the key. As I said, just by subscribing to Rakuten Mobile, 70% increase is realized for Rakuten Ichiba. Let's say all the Rakuten Ichiba users become Rakuten Mobile subscribers, then that would add a lot. Now, in the past, a cell phone services used to be really expensive, but thanks to our technology, the services can be attained at a much lower cost.
With technological innovation, value added is generated, and then, they're returned back to the users in the form of points. Where are we generating a value added? We are making value added, and so other companies cannot catch up with us. I think it's a matter of intelligence that we have that while others don't have.
Okay, thank you.
Thank you very much. It is almost time to close the first part, let us take a final question from the media. The last question is from Tsuhan Shinbun, Kawanishi-san.
Kawanishi from Tsuhan Shinbun, good to talk to you. I have two questions. The first one, about the number of active user. I think this is your first time disclose the active user number. Among the 100 or so million active Rakuten user. Then how do you view your current active users number? Then, is there any room for you to grow the active user number more? That is my first question. The second question is, Mikitani-san said, monthly GMS comparing to the subscription, 70% increase was made.
With this, the new price plan, how much positive impact will be brought to Rakuten Ichiba? If you have any new idea, please share that with us.
Well, first of all, 36 million is the number of active users. Hopefully, we want the half of the Japanese population to join our service. We don't have a specific monthly target, but the brand recognition and also the prevalence of the points and the partners, including the Seiyu. Then this is online, offline combined model. With that, the half of the population can be using our services. That is reachable users. We have a weapon of points and also the synergy with the mobile. We can maximize that. They are using the Rakuten Mobile, so let's purchase from the Rakuten ecosystem.
If you buy something on Rakuten Ichiba, then you can use the Rakuten Mobile almost for free of charge. Where can we generate this added value? For example, we are eliminating waste, such as from the advertisement or distribution. We save our cost with our technology and return that to our customers. As a result, they receive the points. They used to pay JPY 7,000 for mobile phone, now it becomes almost free. We want to realize that kind of the society. So the 70% is the number today, and will it be sustained or will it be saturated at some point in time? We don't know. We need to see for a few years. Thank you very much.
Thank you very much.
This concludes the media Q&A session for the financial results meeting.
We now would like to move on to the Q&A session for the institutional investors and analysts. You can actually inquire from the Q&A form shown at the bottom of the screen. Please limit your question to anything regarding or related to the financial results and maximum two questions at one time. Please ask the questions together at one time. We have a hand up by Tsuruo-san from Citigroup Global Markets Japan.
Can you hear me? I muted myself. Thank you for this opportunity to ask a question. I to ask the two questions together. First of all, about the loss in the quarter for mobile, April to June, and also, if possible, July to September, how you see that. Roaming cost, for example, how is it going to be improved? What is your prospect as of now?
If you could include that as well. My second question is about the new plan, the pricing that you have announced. Looking at the metrics on a monthly basis, on a per card basis, maybe JPY 50,000 is spent. So two percentage points given or increased will mean JPY 1,000, and I think it would even things out. Is that a fair way of looking at it? In other words, you wouldn't lose the subscribers as a result? In other words, my question has to do with the economics that you have in mind. Thank you. Those are the two questions.
Okay. For your question about the performance, I will ask Mr. Yazawa to talk about. For the second question, Ms. Kono-san will address that question. Yazawa in charge of Rakuten Mobile.
Thank you very much for the question, and your question has to do with the prospect going forward. Roaming, which is a large, piece in the costs. Well, October this year and April next year, these are the two major timings at which, there will be a major, reduction in the roaming. On the flip side of that, base stations are being built out steadily. In the past, there were some, gaps, so to speak, and we actually, discontinued or, cut roaming, from time to time, but the pieces of the puzzle are coming together right now. Of course, with the agreement between the two companies, we cannot really disclose the details. However, in terms of the, business performance or the earnings, we expect a positive impact and contribution.
Also in terms of the positive, revenue, UN-LIMIT VII is introduced this time, and as a result, a major improvement is expected. Thank you very much. Some additional comments here from Mr. Hirose.
Yes, this is Hirose speaking. April to June and July to September, as Mr. Yazawa mentioned, in April, there's this cut of the roaming. In other words, of course, roaming discontinuation will actually be implemented during the months of April to June, and gradually there will be less roaming done. That will continue at a lower level. Roamings will continue at a low level, and then that will continue into the months beyond July as well.
In reality, from November, if I remember correctly, this, you know, free of charge users will no longer exist. But as of June, the so-called free users, so to speak, will no longer exist and so 40% data increase as we switch to dedicated Rakuten circuits and data volume will increase. Also optional services, for example, for three months, 15 minutes unlimited calls. How much people will stay there, stay with that plan, we don't know, but we will see. Then depending on the results, maybe ARPU can be made twice as large or three times as large, depending on the situation. As for the points, Kono-san, can you address that question? Kono in charge of marketing. Let me address that question about the point.
You mentioned a 500,000 card being used and plus two times, so you said 1,000. Well, there are such users, yes. Also in the case of Rakuten Ichiba, the business there is very steady, so this twofold point being given is quite a big benefit for many. As was mentioned earlier, people who are not using Rakuten Ichiba right now, as the next slide shows, there are many other services where you know the bundled services can be leveraged. We have announced this today as well. Proof of concept-wise, there have been a lot of different campaigns underway. Given the track record, if the first one month is provided for free, how long would they stay with us? We actually have some records that we can refer back to.
UN-LIMIT VII, based on that knowledge that we have, we believe is a huge benefit, gives them a huge benefit for the users. Of course, zero yen will no longer be the case, so that is one fact. By using these different services together, at the end of the day, I think the subscribers will stay with us to a certain degree. That's how we see things evolving. Just one follow-up, if I may. Well, simply put, Rakuten Ichiba and Marketplace, roughly speaking, so 2% reduction, but still, we can win back 7%. That's the structure.
In other words, where you profit is the question, I would say. I think that's an easy way of putting things.
Thank you very much. Sorry, one follow-up. You know, looking at the Profit and Losses of Q1, and Q2. Q1, you show the dotted line, and that can be the expected line for the Q2. That is my first question. If possible, below 1 GB user. When I look at the industry data, I think it's about 30% of the entire user who are using the data below 1 GB. What about your case? Are they using their card as well?
As for the data of the consumer data, we do not disclose, so I cannot answer to that part.
However, to us, both positive and negative, what will happen by implementing this service, of course, we have considered beforehand and make the final decision today. Maybe that's how you can interpret of this. As for the Profit and Losses, about the dotted line. Hirose-san, can you make any comment on this dotted line for the expected Q2 line?
Well, +1% or -1%, those detail, excluding those detailed portion. We have been installing our network, and then we can reduce the roaming cost largely with that. If we think users using this roaming service only, it makes loss, and then that drags our overall revenue. Therefore, we made our own efforts to set up our own dedicated line network.
We need to have some for indoor for the roaming. When everything is switched over to our dedicated network, and then when it comes to the 5G era, the data volume of 100 or 200 GB will become very common. When that era comes, the pricing of JPY 2,980 is reasonably cheap. Given the data volume will be increasing, that would be driving the ARPU increase as well. That's how we view. Thank you.
Another question, this time is by Hiroko Sato-san from Jefferies Securities.
Hiroko Sato from Jefferies Japan Limited. Thank you for this opportunity. I have two questions. Again, it's about mobile business, Rakuten Symphony in particular. You have orders worth billions of JPY, and from maybe since Q4 of last year, I think, it is reflected in the revenue. Maybe the number is not large. In other words, it's not making a tremendous contribution to the revenue overall. At what timing do you see maybe 10 billion JPY or 20 billion JPY licensing revenues will be reflected in the earnings? Licensing in general, business 7%-8% or software licensing might even mean 30% or 50%.
What is the timing at which that contribution will be reflected in the earnings? I'm sure that you are in the red ink because you send people to Europe and others, but what is the timing at which you have the profitability coming from that?
Business. It's a business that's built on software, and our ability to deliver cost-efficient structure is very, very different, obviously, than building infrastructure that requires hardware. This year, we booked a substantial amount of our services revenue, and now we're in the delivery stage. Within a year old business, I think we made a tremendous progress. I don't think the costs to send people to Europe is, by the way, that significant. We structured our contract to protect our financial recognition with back-to-back contracts. We expect to start recognizing a significant amount of the revenue, end of this year and accelerate, beginning of next year.
One additional thing to mention, keep in mind that with the latest acquisition that we have done in cloud, Rakuten Symphony now have a very unique technology package from cloud, radio, OSS, BSS, and a large ecosystem contribution to this. We are very confident of our ability to pull the revenue and accelerate them end of this year.
Okay, end of this year. I mean, this is going to be a big revenue or earnings addition to your mobile, which hopefully will cover some of your red ink. That's my understanding because theoretically, your revenues should equal to gross profit margin. It's really a licensing revenue. That's my understanding. Is that correct?
Absolutely. If you look at, I think we've reported this. Mickey in his earlier report, the total addressable market for the business unit that Symphony is in is very, very massive. $125 billion by year 2025 gives us a tremendous opportunity to compete for this space. The desire for Symphony to be completely software-as-a-service, so that's really important to recognize that our margins in software is extremely healthy. The more that we continue to scale, the more that we're able to deliver on the projects, especially in one-on-one, and we have a couple of very important ones in North America. We anticipate that this contribution to mobile will be very, very significant in fact.
The additional follow-up question is: Is Symphony earnings have more impact than the roaming cost cuts next Fiscal Year? Which will have a more impact to your earnings-
Well, I think.
for mobile segment?
I mean, two things. I think Symphony as a business, first of all, the reason that we reported consolidated or will report consolidated earnings, keep in mind that mobile business in Japan is almost a living lab that Symphony needs to continue to build, validate the products, meet the quality expectation of Japan's consumers. While we believe that in the long term, Symphony potential is substantial because of course the market segments and the opportunities, now you're really addressing the world, not just local market. We believe that the potential in terms of roaming cutoff, we will accelerate and as Yazawa-san and Miki talked about, we will address the roaming this year. Then Symphony itself is gonna contribute substantially to our earnings by end of this year.
Okay, thank you. Japanese interlocutor, I have another. In MVNO portion. The number of subscription chart you showed and the number of MVNO has been decreasing. Well, in the future, at some timing, is there any timing that would be disappeared? Well, maybe in the second half of the next term, are you going to cut them? What do you think about it? In your previous question, the Q2 or Q3 or to reduce the large amount of loss, we are in that path. When do we finish the service, and how can we book or recognize the revenue? It's up to the accounting, so we are working on that.
Recognition of the revenue will mainly happen in Q4 and from Q1 to Q3 increase of ARPU, and most of our users will become a paying user and increasing the ARPU and the roaming cost has been cut. Those are the drivers. Your next question about the MVNO question, Yazawa-san will take care of that. Thank you.
Yazawa of Mobile is speaking. As you can see from this chart, an MVNO, we are borrowing the line from Docomo, so we have we've already stopped the new application. Are we going to stop this service or not? Nothing has decided at this point in time. If that happens, then we will need to be accountable to explain, but at this point in time, nothing has decided.
Last question. This is out of my curiosity. This is quite attractive, and you have announced the UN-LIMIT VII. On the other hand, Docomo's user, well, let's do the migration and having the campaign, and you still have this. In order to migrate them, what kind of actions needs to be done? Do you need to stop this, the services? It's also what you are talking about the 770,000 subscribers migration.
Well, the other people, there are many people who are resistant to change. Cumbersome to move to other platform. The population coverage were 99%, and there are some consumers out of this scope. That's the fact.
Gradually, as you can see from this, the graph, we had the originally more than two million, and it went down to 770,000. This kind of the natural attrition will continue. User who used to pay JPY 1,000, they don't use data, so they don't require any fast data network. For those segment, for this bucket, we don't, they don't have to stop because we already have the revenue and the profit. Ingres understood. Thank you very much.
Thank you.
Thank you very much.
Next question is from CLSA, Mr. Oliver Matthew, please.
Hello. Thank you. My question is about the feedback on your service. I think earlier today you presented some very encouraging feedback on Rakuten Mobile. Could you share any other feedback you've had maybe compared to other lower priced competitors like Y!mobile or ahamo? Which areas you still think you need to improve? I did notice that there were some people who maybe felt the video experience was not so good at the moment. Could you tell us more which areas you're still working on? Thank you.
Yeah, thank you very much. I think this is really a very, very important question. You know, when we decided to build mobile network in Japan, it was also important to recognize that it was not just about the idea or concept that we're building this beautiful, elegant cloud-native architecture. By design, by purpose, we have built one of the most densest network from day zero, and this is also very, very deliberate. Not a lot of people really understood that the fundamental design of this network is to drive coverage both indoor and outdoor.
While we looked at the overall experience, we think both, you know, the areas around coverage we're addressing, and with both deployments of macro as well as massive densifications through small cells, we feel really good about where we ended up, what we call our phase one area. The area that of course we would love to do a lot more on and continue to address is now we're focused on acceleration of 5G. Of course, with that, we have a whole bunch of wider spectrum bandwidth, almost 500 MHz of spectrum available to us, to drive better user experience, better quality.
If you look, I encourage you to look at the latest report around our 5G experience, we're one of the best in terms of both download, upload experience in Japan. We feel that the natural now next steps for us is really the emphasis on maximizing this massive bandwidth around 5G spectrum in Japan.
Thank you.
Thank you very much.
The next question is from Bank of America. Nagao-san, please start your question.
Nagao of Bank of America, can you hear my voice? Yes, we can hear you. Thank you very much. I have the questions, and the first question about the domestic EC GMS. You had very high hurdle one year ago, but actually you made double-digit growth, and it is a quite good progress and performance. Could you break down about the reason or about the profitability of the domestic market? Then I think this is a record high after you changed the revenue criteria. Including the background, why you have such a good performance? Could you educate me more? That is my first question. The second question is about mobile.
Conventionally, the subscribers with zero yen or the free of charge, and then that would be an initial access point, and then they will use more of the services and then the gain, the profit from there. You started not to do this as a free of charge plan and you changed the pricing plan. Minimum level is JPY 980. Why did you change to this new business pricing plan? Those are the two questions.
Takeda is speaking. As for the first question, just like the previous term, the customer started to purchase items online, and the frequency of that purchase has been sustained or kept. That is the underlying of the performance.
Among the commerce service and Rakuten Ichiba, we have the customers start to buy different items of different genres. As shown in the presentation slide, using the other services, in other words, the cross-use increased. With that, we have users with high loyalty, so our customers attributes change to high loyal users, and those loyal users are supporting our growth. Thank you very much. Another major point is so-called thank you shop, including the delivery cost. We have had this program and two years have passed and the recognition of this thank you shop or 3,980 yen shop is increased, and the customers feel safe and secure to purchase their items from our services.
Until the last one mile, we have co-work with the JP and do the delivery, and then NPS point is increasing with that. That is another contribution factor to our growth. This growth is quite sustainable. Then the profit-wise, as written there, we made a great performance, and there are three reasons behind it. The first one is during the pandemic or COVID-19, we revisited costs one by one, for example, marketing costs and other costs. Then when the momentum comes back, we need to restructure ourselves to boost our business when the demand comes back. At this timing of the year, where the government released the COVID emergency declaration, this kind of efficiency made a great contribution to our business.
Well, I think I said this many times. One is that the network coverage went up to 97.2%, and it will go beyond 99% before the end of the year, as you may already know this.
iPhone SE, the old iPhone SE, the au roaming, it will not release. That, the speed would slow down when the roaming costs decrease, but we can avoid it, so the quality of our network improved. That is the one thing. Our targeted segment, there are three target segment. One is price-conscious users, don't want to pay a penny. The second one is Rakuten Group's loyal customer, and the third one is data-heavy users. In early stage, we need to target all of the segments. That was our plan. However, rather than give them the free of charge services, we need to provide the better points back to the consumers.
Still the 11% of the Rakuten Ichiba is using our Rakuten Mobile, but we can increase the number of users or subscribers from there, which may lead to 30 million subscribers. It's foreseeable. Moving from the discount strategy that we used to take, well, we need some points, high points in the other marketing, and then we want our loyal users to use our services more. The ARPU per user and the entire group's gross margin will become different. We already accumulated data over the past two-year performance, so we need to have a better marketing strategy, and we changed our marketing strategy to make that happen.
One follow-up question. If that is the case, even you...
I think it's quite appreciated for you to lose those non-contributing users to your revenue and profit, and then you can improve your quality of the business, so you are now changing your gear, steering the gear of the business. How do you view that?
Well, yes, to be honest, your observation is correct. Well, there is non-paying user. Keeping non-paying user is quite tough. That is the honest opinion. Thank you very much. It's actually time that we have to close this session together with investors and analysts. Mr. Mikitani, Mickey has a few remarks at the end. Well, thank you very much. Rakuten Group has tried many things, maybe too many things have been tried.
The synergistic effect, you know, it leads to a point program and it leads to one leads to another, and I think things are working, and I think that is reflected in the financial results that I presented today. The mobile profitability to be improved is one piece. Ecosystem contribution is huge when it comes to mobile contribution. When you think about the global mobile subscription, it's actually moving in a reverse direction. 5G has been invested in, but they're not making profit. That's what we generally hear in other markets. Within our group, Rakuten Group, because the group members of Rakuten once they start using Rakuten Mobile, then our profits will go up quite dramatically. The break-even point we want to go beyond that as soon as possible.
Once we go beyond that point, then many things will change as well. The mobile users reaching 20-25 million, when that happens in the future, then the service by Rakuten Group will have no formidable enemy. Of course, we would try many things, and of course, friendly competition is always welcome. Of course, we will not monopolize the market. There should be a certain level of competition, so that. With that in mind, we would like to enhance our service level going forward. Now, the data, the amount of data that we have and the quality of the data that we have today, when you compare with others around the world, it is unprecedented. We have data that others don't have.
For the consumer services, of course, with due care for the personal and privacy considerations, we will leverage them and also real time. I think there are many things that are possible with the technology today, so I hope that you will interpret it as such. Thank you very much for your time. This concludes the 2022 Q1 Consolidated Financial Results Briefing Session, as well as the Q&A session. Thank you very much once again for joining us today.