Rakuten Group, Inc.'s Q2 2025 Financial Results Discussion Transcript
Rakuten Reports Strong Q2 2025 Financial Results with Revenue Growth Across Key Segments
Rakuten Group Inc. (OTCPK:RKUNY) has announced its Q2 2025 financial results, showing robust growth across its key business segments. The company posted revenue of $4.04 billion, exceeding analyst estimates of $3.83 billion. However, earnings-per-share (EPS) was -$0.16, missing the consensus estimate of $0.04.
During the earnings call on August 8, 2025, Kenji Hirose, Group Executive VP, Group CFO & Director, and Ting Cai, Chief AI & Data Officer and Group Senior Managing Executive Officer of AI & Data Division, provided updates on the company's performance.
Highlights from the call and analysis include:
- Rakuten achieved its first quarterly operating profit since 2019, with significant increases in non-GAAP operating income. This growth was driven by strong performances in Rakuten Ichiba (e-commerce), Rakuten Travel, and Rakuten Card.
- The Internet Services segment (including e-commerce and digital services) reported revenue of 324.5 billion yen, up 6.8% year over year (YoY). Domestic e-commerce gross merchandise sales (GMS) increased 4.7% YoY to 1.49 trillion yen.
- The FinTech segment showed both revenue and profit growth, with revenue of 232.7 billion yen, a 14.8% YoY increase.
- The Mobile segment progressed steadily, with revenue rising 18.1% YoY to 112.1 billion yen.
- Rakuten Mobile surpassed 9 million subscribers on July 7 and reached 9.08 million subscribers by July 31, 2025. The company aims to further accelerate the pace of net additions in H2 to break the 10 million subscriber milestone.
- The consolidated non-GAAP operating income improved by JPY31.9 billion in Q2 2025. Rakuten Mobile's stand-alone EBITDA improved by JPY19.1 billion YoY in Q2 2025, reaching JPY5.6 billion.
- Despite missing EPS estimates, finance experts rate Rakuten as a Buy, citing the EBITDA beat, valuation expansion catalysts, and potential for re-rating given the strong operational improvements and profitability turnaround.
- The reported EPS miss was consistent with some analysts' expectations of continued investment impacting near-term profitability, but the revenue beat and segment growth highlight positive momentum across Rakuten’s diversified businesses.
No conference call transcript or detailed Q2 2025 earnings call discussion was immediately available as of the latest reports; however, market commentary highlights a bullish outlook on Rakuten’s financial health and strategic progress.
In summary, Rakuten's Q2 2025 earnings reflect strong revenue growth and operational improvements, though EPS remains negative. The company's strategic progress, coupled with the first operating profit in years and key segment growth drivers, has resulted in a generally positive market sentiment.
- The FinTech segment, a key part of Rakuten's diverse business portfolio, displayed both revenue and profit growth, fueled by strong performances in areas such as Rakuten Ichiba (e-commerce), Rakuten Travel, and Rakuten Card – all segments being integral to the company's overall financial health.
- In the Q2 2025 earnings call, discussions centered around the impact of technology on Rakuten's success, with the Chief AI & Data Officer emphasizing the significant role that data and artificial intelligence play in driving growth across various business segments, particularly in the areas of e-commerce, FinTech, and mobile services.
