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FAQ
About the Company
Please tell us about your human resources strategy and the current recruitment situation.
Disclosed on October 1, 2024
Our human resources strategy is characterized by its fusion of a global outlook with local characteristics. While we have dedicated recruitment teams at each location, we also have a team overseeing global HR strategy and crossborder recruitment. This structure allows us to balance recruitment activities that meet each country's specific needs with the execution of a consistent global strategy.
In terms of competitive advantage in talent acquisition, we have a unique presence as a startup originating from Southeast Asia. We have achieved high growth while maintaining stable profitability improvement and financial soundness, along with the credibility of being a listed company. Moreover, there are very few companies with such a multinational organization and culture. We maximize this unique position to strategically and efficiently attract talent in each country who are eager to build careers in the global internet industry.
We are also strengthening knowledge sharing and talent development. For example, we conduct company-wide monthly knowledge sharing sessions and cross-departmental reporting meetings to promote the horizontal expansion of best practices. Furthermore, we aim to broaden employees' global perspectives and deepen cross-cultural understanding through the promotion of cross-border projects. We also provide diverse and advanced learning opportunities, including AI-support training programs, an internal online learning platform, and level-specific training. Going forward, we aim to establish a sustainable growth foundation by developing flexible human resource strategies that respond quickly to rapid market and technological changes.
Our human resources strategy is characterized by its fusion of a global outlook with local characteristics. While we have dedicated recruitment teams at each location, we also have a team overseeing global HR strategy and crossborder recruitment. This structure allows us to balance recruitment activities that meet each country's specific needs with the execution of a consistent global strategy.
In terms of competitive advantage in talent acquisition, we have a unique presence as a startup originating from Southeast Asia. We have achieved high growth while maintaining stable profitability improvement and financial soundness, along with the credibility of being a listed company. Moreover, there are very few companies with such a multinational organization and culture. We maximize this unique position to strategically and efficiently attract talent in each country who are eager to build careers in the global internet industry.
We are also strengthening knowledge sharing and talent development. For example, we conduct company-wide monthly knowledge sharing sessions and cross-departmental reporting meetings to promote the horizontal expansion of best practices. Furthermore, we aim to broaden employees' global perspectives and deepen cross-cultural understanding through the promotion of cross-border projects. We also provide diverse and advanced learning opportunities, including AI-support training programs, an internal online learning platform, and level-specific training. Going forward, we aim to establish a sustainable growth foundation by developing flexible human resource strategies that respond quickly to rapid market and technological changes.
What is the stock code?
The Company's stock code (ticker) is 5027.
When did the company go public?
The Company went public on March 29, 2023.
What is the background of the company?
AnyMind Group was founded in Singapore in April 2016 and currently operates from 22 offices and locations across 15 markets worldwide. AnyMind Group is a technology company that provides a one-stop platform for solutions such as brand development, manufacturing management, media management, e-commerce enablement, marketing and logistics management.
What kind of business do you operate?
The company has two business segments, Brand Commerce and Partner Growth.
Brand Commerce refers to the value chain from designing and planning, production management, e-commerce enablement and operation, marketing and logistics management, mainly for the e-commerce and direct-to-consumer domains, for businesses and individuals.
Partner Growth refers to the growth-related activities for publishers and creators.
Brand Commerce refers to the value chain from designing and planning, production management, e-commerce enablement and operation, marketing and logistics management, mainly for the e-commerce and direct-to-consumer domains, for businesses and individuals.
Partner Growth refers to the growth-related activities for publishers and creators.
About Business
Is there any impact on the business from policy changes and economic fluctuations in the United States and China?
Disclosed on April 2, 2025
We currently do not have business operations in the US market and do not anticipate any direct impact from US policy changes. However, US policy fluctuations indirectly affect the global economy, and tariff policies, in particular, may influence the business strategies of Asian companies (especially Chinese companies) with global operations. At present, we do not anticipate any negative impacts, and we believe there may be scenarios where the importance of Asian markets, including Southeast Asia, becomes relatively more important.
Sales revenue from the Greater China region accounts for more than 10% of our total in FY2024, but this is primarily from the Hong Kong and Taiwan markets, with limited business targeting mainland China. Additionally, our China-based team mainly focuses on supporting brand companies and partners expanding from China to overseas markets, so we expect the impact of economic fluctuations within China to be limited as well.
We will continue to monitor geopolitical changes and market trends while maintaining a flexible business strategy, aiming for medium to long-term growth in the Asian market.
We currently do not have business operations in the US market and do not anticipate any direct impact from US policy changes. However, US policy fluctuations indirectly affect the global economy, and tariff policies, in particular, may influence the business strategies of Asian companies (especially Chinese companies) with global operations. At present, we do not anticipate any negative impacts, and we believe there may be scenarios where the importance of Asian markets, including Southeast Asia, becomes relatively more important.
Sales revenue from the Greater China region accounts for more than 10% of our total in FY2024, but this is primarily from the Hong Kong and Taiwan markets, with limited business targeting mainland China. Additionally, our China-based team mainly focuses on supporting brand companies and partners expanding from China to overseas markets, so we expect the impact of economic fluctuations within China to be limited as well.
We will continue to monitor geopolitical changes and market trends while maintaining a flexible business strategy, aiming for medium to long-term growth in the Asian market.
Will there be no expansion into new countries or regions in the future?
Disclosed on April 2, 2025
While we are constantly considering expansion into new markets, our current focus is on prioritizing business penetration in the Asian, Indian, and Middle Eastern markets, where we believe there are sufficient opportunities and room for growth. For the time being, this is a phase of further deepening business in existing markets, and even if we do expand into Western or other emerging markets, we anticipate starting with a limited approach, such as establishing sales offices first.
On the other hand, in the medium to long term, we will carefully consider the possibility of expansion into regions outside Asia, leveraging the networks, customer base, and business models developed, while taking into account business resources.
Regarding the Chinese market, we do not currently anticipate aggressive domestic expansion in China, and the policy for China-related business is to focus on supporting outbound or inbound demand from Chinese companies.
While we are constantly considering expansion into new markets, our current focus is on prioritizing business penetration in the Asian, Indian, and Middle Eastern markets, where we believe there are sufficient opportunities and room for growth. For the time being, this is a phase of further deepening business in existing markets, and even if we do expand into Western or other emerging markets, we anticipate starting with a limited approach, such as establishing sales offices first.
On the other hand, in the medium to long term, we will carefully consider the possibility of expansion into regions outside Asia, leveraging the networks, customer base, and business models developed, while taking into account business resources.
Regarding the Chinese market, we do not currently anticipate aggressive domestic expansion in China, and the policy for China-related business is to focus on supporting outbound or inbound demand from Chinese companies.
Please explain the specific strategies for achieving future business performance targets and growth.
Disclosed on February 14, 2025
In today's earnings announcement, we have published our new medium-term performance targets. Over the three-year period from the fiscal year ending December 2024 to the fiscal year ending December 2027, we aim to achieve a Compound Annual Growth Rate (CAGR) of 27% or more in both revenue and gross profit, targeting revenue of 105 billion yen and gross profit of 38.5 billion yen by the fiscal year ending December 2027. Regarding profitability, using our fiscal year 2024 operating profit margin of 5.0% as a baseline, we will pursue balanced business development between growth and profitability while steadily improving our profit margins each year.
We believe there continues to be strong demand both domestically and internationally for our B2B services, primarily focused on e-commerce support and marketing support, which form the foundation of our growth outlook. We also believe we can further strengthen our competitive position in the Asian market. We identify three competitive advantages: "Comprehensive solution capabilities covering both e-commerce and marketing," "Pan-Asian business operations," and "Technology development infrastructure."
First, for enterprise clients aiming to enhance their brand value and achieve business growth, particularly in cross-border brand expansion, the optimization of brand launches and the strengthening of e-commerce sales in each country has become an interconnected management challenge for various clients. We believe our ability to provide comprehensive support in these areas offers significant value. Additionally, regarding business expansion in Asia, we recognize that many cases involve simultaneous expansion into multiple countries rather than targeting a step-by-step approach to expansion into individual countries. In such situations, our global structure, which can provide broad support across multiple fragmented markets, becomes crucial.
Finally, since our founding, we have continuously invested in technology, providing a well-balanced combination of data and generative AI utilization along with operational support. We recognize that for our client base of major enterprise brands, the importance of effectively utilizing technology and data continues to increase.
As for our growth direction, we will pursue three main strategic priorities. First, regarding our enterprise support structure across Asia, we plan to continuously strengthen our operations in each country while leveraging our current business foundation in 15 countries and regions. We expect that as each country's operations grow and their structures are further strengthened, the appeal of our group as a whole will increase.
Furthermore, as we grow our business in each country, we anticipate an expansion of our networks of enterprises, media, and creators. Having more extensive local networks in each country will positively influence and contribute to the growth of each business segment.
Third, we will advance the utilization of generative AI and the digital transformation (DX) of our internal operations. While this is a continuation of our past initiatives, we are promoting AI implementation across our products and solutions based on recent advances in AI technology. We are pushing forward with the integration of new AI-powered features into products like AnyTag and the development of AI-utilizing solutions such as AnyLive. Additionally, we will further improve productivity by actively promoting DX and AI utilization in our internal operations.
In today's earnings announcement, we have published our new medium-term performance targets. Over the three-year period from the fiscal year ending December 2024 to the fiscal year ending December 2027, we aim to achieve a Compound Annual Growth Rate (CAGR) of 27% or more in both revenue and gross profit, targeting revenue of 105 billion yen and gross profit of 38.5 billion yen by the fiscal year ending December 2027. Regarding profitability, using our fiscal year 2024 operating profit margin of 5.0% as a baseline, we will pursue balanced business development between growth and profitability while steadily improving our profit margins each year.
We believe there continues to be strong demand both domestically and internationally for our B2B services, primarily focused on e-commerce support and marketing support, which form the foundation of our growth outlook. We also believe we can further strengthen our competitive position in the Asian market. We identify three competitive advantages: "Comprehensive solution capabilities covering both e-commerce and marketing," "Pan-Asian business operations," and "Technology development infrastructure."
First, for enterprise clients aiming to enhance their brand value and achieve business growth, particularly in cross-border brand expansion, the optimization of brand launches and the strengthening of e-commerce sales in each country has become an interconnected management challenge for various clients. We believe our ability to provide comprehensive support in these areas offers significant value. Additionally, regarding business expansion in Asia, we recognize that many cases involve simultaneous expansion into multiple countries rather than targeting a step-by-step approach to expansion into individual countries. In such situations, our global structure, which can provide broad support across multiple fragmented markets, becomes crucial.
Finally, since our founding, we have continuously invested in technology, providing a well-balanced combination of data and generative AI utilization along with operational support. We recognize that for our client base of major enterprise brands, the importance of effectively utilizing technology and data continues to increase.
As for our growth direction, we will pursue three main strategic priorities. First, regarding our enterprise support structure across Asia, we plan to continuously strengthen our operations in each country while leveraging our current business foundation in 15 countries and regions. We expect that as each country's operations grow and their structures are further strengthened, the appeal of our group as a whole will increase.
Furthermore, as we grow our business in each country, we anticipate an expansion of our networks of enterprises, media, and creators. Having more extensive local networks in each country will positively influence and contribute to the growth of each business segment.
Third, we will advance the utilization of generative AI and the digital transformation (DX) of our internal operations. While this is a continuation of our past initiatives, we are promoting AI implementation across our products and solutions based on recent advances in AI technology. We are pushing forward with the integration of new AI-powered features into products like AnyTag and the development of AI-utilizing solutions such as AnyLive. Additionally, we will further improve productivity by actively promoting DX and AI utilization in our internal operations.
Please tell us about the growth potential of 'AnyLive,' the new solution announced on September 25, 2024.
Disclosed on January 8, 2025
At the end of September 2024, we launched 'AnyLive,' a multilingual generative AI live commerce platform. In just a few months since its launch, we have acquired prominent clients including the 'evian' brand, known for bottled water and skincare products. In the case of the evian brand, we implemented hybrid streaming in the Thai market, combining AI models with human livestreamers, achieving 3.5 times higher revenue compared to conventional methods while reducing streaming costs by 90%.
In recent years, live commerce (an e-commerce sales solution that promotes purchases through live video streaming while introducing products and communicating with viewers in real-time) has become an important marketing method for EC sales in Southeast Asia. However, live streaming faces limitations in broadcasting hours and frequency due to issues with human resources (livestreamers) and costs. 'AnyLive,' through its use of AI models for live commerce, not only enables easy support for seven Asian languages but also allows for 24-hour live commerce streaming, including off-hours when regular human-operated live commerce would not be available.
'AnyLive' operates as part of our D2C/EC segment, and since its announcement, it has been steadily increasing new client engagements as a major solution in our B2B EC business development efforts. While we believe live commerce requires a comprehensive approach, including not only AI models but also human livestreamers and collaborations with prominent influencers, we expect the importance of AI utilization to increase further. Currently, we are primarily supporting existing clients, but moving forward, we plan to accelerate the growth of our B2B EC support business by expanding the client base for 'AnyLive.
At the end of September 2024, we launched 'AnyLive,' a multilingual generative AI live commerce platform. In just a few months since its launch, we have acquired prominent clients including the 'evian' brand, known for bottled water and skincare products. In the case of the evian brand, we implemented hybrid streaming in the Thai market, combining AI models with human livestreamers, achieving 3.5 times higher revenue compared to conventional methods while reducing streaming costs by 90%.
In recent years, live commerce (an e-commerce sales solution that promotes purchases through live video streaming while introducing products and communicating with viewers in real-time) has become an important marketing method for EC sales in Southeast Asia. However, live streaming faces limitations in broadcasting hours and frequency due to issues with human resources (livestreamers) and costs. 'AnyLive,' through its use of AI models for live commerce, not only enables easy support for seven Asian languages but also allows for 24-hour live commerce streaming, including off-hours when regular human-operated live commerce would not be available.
'AnyLive' operates as part of our D2C/EC segment, and since its announcement, it has been steadily increasing new client engagements as a major solution in our B2B EC business development efforts. While we believe live commerce requires a comprehensive approach, including not only AI models but also human livestreamers and collaborations with prominent influencers, we expect the importance of AI utilization to increase further. Currently, we are primarily supporting existing clients, but moving forward, we plan to accelerate the growth of our B2B EC support business by expanding the client base for 'AnyLive.
Are there any risks you perceive for future performance or business operations?
Disclosed August 14, 2024
We operate in rapidly changing industries, so we constantly monitor changes in the industry and market. Additionally, as we expand globally, we also face geopolitical risks. However, our diversified business structure and revenue bases across various countries allow for risk distribution at the group level. Even with temporary changes in market conditions, we can expect stable growth in the Asian economy as a whole. Therefore, we believe that we have effective risk control as a group.
In business operations, more important points are recognizing the current situation regarding market changes in each country and implementing timely responses to these changes. For this, we believe that management teams in each country are crucial. While our company has diverse management members in each country, we believe that further strengthening of these country management teams is necessary to achieve higher growth in the medium to long term.
We operate in rapidly changing industries, so we constantly monitor changes in the industry and market. Additionally, as we expand globally, we also face geopolitical risks. However, our diversified business structure and revenue bases across various countries allow for risk distribution at the group level. Even with temporary changes in market conditions, we can expect stable growth in the Asian economy as a whole. Therefore, we believe that we have effective risk control as a group.
In business operations, more important points are recognizing the current situation regarding market changes in each country and implementing timely responses to these changes. For this, we believe that management teams in each country are crucial. While our company has diverse management members in each country, we believe that further strengthening of these country management teams is necessary to achieve higher growth in the medium to long term.
What is the revenue model for each business?
Disclosed on June 28, 2023
Our business is largely divided into the Brand Commerce area and the Partner Growth area. In the Brand Commerce area, we mainly provide growth support to corporate brands and the Brand Commerce area can be further sectioned into Marketing and D2C/EC businesses. The Marketing business provides offerings such as influencer marketing and digital marketing. The revenue model is one in which we receive marketing fees from corporate advertisers to implement marketing activities, and the cost of sales are payments to influencers and media (web media and mobile apps).
The D2C/EC business offers multiple solutions in the e-commerce value chain, including production, ecommerce management, and logistics. In the D2C (direct-to-consumer) business for creators, we have a product sales model, in which we hold inventory and earn revenue by selling D2C products together with creators. In the business of providing e-commerce support to corporate clients, there are multiple revenue models, including a sales-sharing model in which we receive a fixed percentage of the income generated from e-commerce sales, a model in which we provide individual solutions and receive a fixed monthly fee, and, a pay-as-you-go model in which we are compensated based on shipping fees, etc. (for AnyLogi, an inventory and logistics management solution).
In the Partner Growth area, revenue is shared with publishers of web media and mobile apps and creators such as YouTubers and TikTokers based on a fixed percentage of advertising revenue. For the revenue sharing model, we recognize advertising revenue received as gross amount and the payments to publishers and creators (other than the percentage of revenue sharing) are treated as cost of sales (whether we adopt the gross or net revenue recognition depends on the structure of contracts with publishers or creators, and the increase in gross profit margin which occurred in 2022 for the creator business was due to an increase in the proportion of contracts that are treated as net amount.). In addition, we also provide support to publishers for website/mobile app UX improvement, data analysis, and other services, and some of our offerings for a fixed fee.
Our business is largely divided into the Brand Commerce area and the Partner Growth area. In the Brand Commerce area, we mainly provide growth support to corporate brands and the Brand Commerce area can be further sectioned into Marketing and D2C/EC businesses. The Marketing business provides offerings such as influencer marketing and digital marketing. The revenue model is one in which we receive marketing fees from corporate advertisers to implement marketing activities, and the cost of sales are payments to influencers and media (web media and mobile apps).
The D2C/EC business offers multiple solutions in the e-commerce value chain, including production, ecommerce management, and logistics. In the D2C (direct-to-consumer) business for creators, we have a product sales model, in which we hold inventory and earn revenue by selling D2C products together with creators. In the business of providing e-commerce support to corporate clients, there are multiple revenue models, including a sales-sharing model in which we receive a fixed percentage of the income generated from e-commerce sales, a model in which we provide individual solutions and receive a fixed monthly fee, and, a pay-as-you-go model in which we are compensated based on shipping fees, etc. (for AnyLogi, an inventory and logistics management solution).
In the Partner Growth area, revenue is shared with publishers of web media and mobile apps and creators such as YouTubers and TikTokers based on a fixed percentage of advertising revenue. For the revenue sharing model, we recognize advertising revenue received as gross amount and the payments to publishers and creators (other than the percentage of revenue sharing) are treated as cost of sales (whether we adopt the gross or net revenue recognition depends on the structure of contracts with publishers or creators, and the increase in gross profit margin which occurred in 2022 for the creator business was due to an increase in the proportion of contracts that are treated as net amount.). In addition, we also provide support to publishers for website/mobile app UX improvement, data analysis, and other services, and some of our offerings for a fixed fee.
Are there any other companies operating in the same business as your company?
Disclosed on June 28, 2023
Our company provides a wide range of solutions primarily in the areas of e-commerce and marketing, 1 including brand building, production management, e-commerce site development and operation, marketing, and logistics management. We have expanded our operations to 13 markets across the region, which means that there are no direct competitors in the entire business. Even when considering individual business segments, there are fewer cases of competition in the entire region of development. Usually, in each country, there are local competitors in each respective business segment separately.
Furthermore, by leveraging the benefits of scaling through global business expansion, we have invested in technologies and data utilization, provided services across Asia through cross-border operations, and offered comprehensive support along the business value chain. This distinctive positioning has led to complementary relationships with local companies in various countries, resulting in numerous cases of collaboration rather than pure competition.
Since our establishment, we have consistently invested in data and products, and we have built a strong local network and organization in each Asian market. We believe that our business foundation provides us with a competitive advantage in the respective country-specific competitive environment. We aim to continue enhancing our unique value proposition and achieve further growth in the future.
Our company provides a wide range of solutions primarily in the areas of e-commerce and marketing, 1 including brand building, production management, e-commerce site development and operation, marketing, and logistics management. We have expanded our operations to 13 markets across the region, which means that there are no direct competitors in the entire business. Even when considering individual business segments, there are fewer cases of competition in the entire region of development. Usually, in each country, there are local competitors in each respective business segment separately.
Furthermore, by leveraging the benefits of scaling through global business expansion, we have invested in technologies and data utilization, provided services across Asia through cross-border operations, and offered comprehensive support along the business value chain. This distinctive positioning has led to complementary relationships with local companies in various countries, resulting in numerous cases of collaboration rather than pure competition.
Since our establishment, we have consistently invested in data and products, and we have built a strong local network and organization in each Asian market. We believe that our business foundation provides us with a competitive advantage in the respective country-specific competitive environment. We aim to continue enhancing our unique value proposition and achieve further growth in the future.
How the Company manage a multinational organization and multinational operation?
Disclosed on June 28, 2023
We have been operating in multiple countries since our establishment, and we have worked towards establishing a structure based on multinational operations. We have built a matrix organization based on two axes, country, and business. Country managers oversee operations in each country, including local teams, and are responsible for talent management, customer relations, and addressing issues specific to local markets. Regional leaders within the business axis focus on optimizing products and operations, tackling challenges that are common globally. This matrix group structure enables us to efficiently manage our business and organization.
We have also implemented a shared accounting system and CRM system throughout the company, including the companies we acquired, and have established an environment where earnings and KPI are managed in real time by business and by country, and weekly discussions are held with the head of each business in each country to review the progress and address issues faced by each business. In addition, we conduct monthly profit analysis by business unit for each country to identify businesses that require investment and businesses that need productivity improvement, and we have a system in place to respond and discuss in a timely manner.
The culture of the entire organization is very flat, and the country managers in each country work closely with other members of the group management team to improve operations in each country through mutual information sharing. In addition, for companies that have joined the group through M&A, we will promote full business integration, including organization and structure, and will establish a reporting line for each country's corporate team in both the regional and country manager's direction. We are also working to build a structure that will allow us to have more resolution and control over each country's business from the perspective of governance.
We have been operating in multiple countries since our establishment, and we have worked towards establishing a structure based on multinational operations. We have built a matrix organization based on two axes, country, and business. Country managers oversee operations in each country, including local teams, and are responsible for talent management, customer relations, and addressing issues specific to local markets. Regional leaders within the business axis focus on optimizing products and operations, tackling challenges that are common globally. This matrix group structure enables us to efficiently manage our business and organization.
We have also implemented a shared accounting system and CRM system throughout the company, including the companies we acquired, and have established an environment where earnings and KPI are managed in real time by business and by country, and weekly discussions are held with the head of each business in each country to review the progress and address issues faced by each business. In addition, we conduct monthly profit analysis by business unit for each country to identify businesses that require investment and businesses that need productivity improvement, and we have a system in place to respond and discuss in a timely manner.
The culture of the entire organization is very flat, and the country managers in each country work closely with other members of the group management team to improve operations in each country through mutual information sharing. In addition, for companies that have joined the group through M&A, we will promote full business integration, including organization and structure, and will establish a reporting line for each country's corporate team in both the regional and country manager's direction. We are also working to build a structure that will allow us to have more resolution and control over each country's business from the perspective of governance.
Is there any seasonality in your business?
Disclosed on April 13, 2023
On page 40 of the “Business Strategies and Growth Opportunities” document disclosed on March 29, 2023, the first quarter of the year (January-March) is expected to be a low season.
The first quarter has fewer business days and operating days than other quarters due to the New Year vacation and Lunar New Year vacations, etc. Many overseas companies (corporate customers) close their books in December and concentrate their marketing investments at the end of the fiscal year, so they often do not actively conduct marketing activities during January and Feburary. As a result, earnings, especially in our Marketing and Partner Growth businesses, tend to remain at lower levels compared to the preceding quarter. In Japan, March is the end of the fiscal year for many companies, which increases marketing spending, but January and February are also low seasons in Japan, and the Company has larger overseas businesses than Japan, resulting in the first quarter of the year being a low season.
The second (April-June) and third (July-September) quarters are not particularly seasonal, but since our business is in a growth stage, sales and gross profit are expected to be higher in the third quarter than in the second quarter.
The fourth quarter (October-December) is a high season for all businesses, as marketing activities and e-commerce sales increase for Diwali, India’s biggest festival in October-November, and Christmas in December, and many overseas companies have a December fiscal year end and tend to concentrate their marketing spending at the end of the fiscal year.
The quarterly distribution of gross profit for the fiscal year ending December 2022, was 20% for the first quarter, 24% for the second quarter, 25% for the third quarter, and 31% for the fourth quarter, indicating that the contribution to earnings increases towards the latter half of the year due to both seasonality and our business growth. We expect the same seasonality and trend to continue in the fiscal year ending December 2023, and beyond.
On page 40 of the “Business Strategies and Growth Opportunities” document disclosed on March 29, 2023, the first quarter of the year (January-March) is expected to be a low season.
The first quarter has fewer business days and operating days than other quarters due to the New Year vacation and Lunar New Year vacations, etc. Many overseas companies (corporate customers) close their books in December and concentrate their marketing investments at the end of the fiscal year, so they often do not actively conduct marketing activities during January and Feburary. As a result, earnings, especially in our Marketing and Partner Growth businesses, tend to remain at lower levels compared to the preceding quarter. In Japan, March is the end of the fiscal year for many companies, which increases marketing spending, but January and February are also low seasons in Japan, and the Company has larger overseas businesses than Japan, resulting in the first quarter of the year being a low season.
The second (April-June) and third (July-September) quarters are not particularly seasonal, but since our business is in a growth stage, sales and gross profit are expected to be higher in the third quarter than in the second quarter.
The fourth quarter (October-December) is a high season for all businesses, as marketing activities and e-commerce sales increase for Diwali, India’s biggest festival in October-November, and Christmas in December, and many overseas companies have a December fiscal year end and tend to concentrate their marketing spending at the end of the fiscal year.
The quarterly distribution of gross profit for the fiscal year ending December 2022, was 20% for the first quarter, 24% for the second quarter, 25% for the third quarter, and 31% for the fourth quarter, indicating that the contribution to earnings increases towards the latter half of the year due to both seasonality and our business growth. We expect the same seasonality and trend to continue in the fiscal year ending December 2023, and beyond.
About Financial Results and Performance
How to anticipate seasonality for 2025 performance?
Disclosed on April 2, 2025
Our business continues to experience seasonality, with Q1 as the low season and Q4 as the high season. In the last fiscal year, Q1 FY2024, despite the usual seasonality, the Partner Growth business grew at a rate that surpassed this pattern, particularly in creator growth support due to successful creator acquisition. As a result, revenue in the Partner Growth business expanded from Q4 FY2023 to Q1 FY2024, resulting in a smaller Q1 revenue decline than usual.
However, the Partner Growth business fundamentally has a business structure that is affected by advertising market seasonality, and we expect the normal trend of Q4 as high season and Q1 as low season to continue in the future. We therefore anticipate this seasonal trend to continue affecting future Q1 performance across all business segments.
Our business continues to experience seasonality, with Q1 as the low season and Q4 as the high season. In the last fiscal year, Q1 FY2024, despite the usual seasonality, the Partner Growth business grew at a rate that surpassed this pattern, particularly in creator growth support due to successful creator acquisition. As a result, revenue in the Partner Growth business expanded from Q4 FY2023 to Q1 FY2024, resulting in a smaller Q1 revenue decline than usual.
However, the Partner Growth business fundamentally has a business structure that is affected by advertising market seasonality, and we expect the normal trend of Q4 as high season and Q1 as low season to continue in the future. We therefore anticipate this seasonal trend to continue affecting future Q1 performance across all business segments.
Could you please explain the potential for productivity improvement in each business going forward?
Disclosed on April 2, 2025
In the Marketing business and E-commerce business for enterprises, we have adopted a BPaaS model that offers operational support alongside software, encouraging technology utilization. We position this as a key competitive advantage in the market. Even in cases where technology alone would make adoption and utilization challenging for enterprise clients, we believe we can significantly reduce implementation barriers by integrating directly into their operations and providing comprehensive support. However, with such a business model, the organizational structure requires staffing for customer support operations, thus necessitating an increase in personnel in line with sales growth. 1 This document is the English translation of the original release in Japanese. In the event of any discrepancy, the original release in Japanese shall prevail.
Meanwhile, productivity improvements due to economies of scale that come with business expansion continue, and the ratio of labor costs to sales or gross profit tends to gradually decrease. Going forward, we also believe that by streamlining routine tasks previously handled by people, such as reporting, using generative AI in internal operations, our existing personnel structure will be able to handle larger volume and scale of projects.
Regarding the composition of SG&A expenses, personnel costs account for over 50%, and expenses such as rent also indirectly fluctuate with increases in personnel. Therefore, the number of personnel is the main driver of SG&A expenses. While recruitment investment for business growth remains important going forward, we expect the pace of personnel increase to gradually slow down due to productivity improvements.
In the Marketing business and E-commerce business for enterprises, we have adopted a BPaaS model that offers operational support alongside software, encouraging technology utilization. We position this as a key competitive advantage in the market. Even in cases where technology alone would make adoption and utilization challenging for enterprise clients, we believe we can significantly reduce implementation barriers by integrating directly into their operations and providing comprehensive support. However, with such a business model, the organizational structure requires staffing for customer support operations, thus necessitating an increase in personnel in line with sales growth. 1 This document is the English translation of the original release in Japanese. In the event of any discrepancy, the original release in Japanese shall prevail.
Meanwhile, productivity improvements due to economies of scale that come with business expansion continue, and the ratio of labor costs to sales or gross profit tends to gradually decrease. Going forward, we also believe that by streamlining routine tasks previously handled by people, such as reporting, using generative AI in internal operations, our existing personnel structure will be able to handle larger volume and scale of projects.
Regarding the composition of SG&A expenses, personnel costs account for over 50%, and expenses such as rent also indirectly fluctuate with increases in personnel. Therefore, the number of personnel is the main driver of SG&A expenses. While recruitment investment for business growth remains important going forward, we expect the pace of personnel increase to gradually slow down due to productivity improvements.
How do you assess the achievement rate of FY2024 actual results against the full-year forecast?
Disclosed on February 14, 2025
Based on steady business performance and improved profitability, we made an upward revision to our full-year forecast for the fiscal year ending December 2024 on November 14, 2024. Subsequently, with continued strong performance in the fourth quarter, our actual results for the fiscal year ending December 2024 exceeded the revised forecast, with revenue achieving 103.3% and gross profit reaching 102.5% of the revised forecast. Compared to the previous fiscal year, revenue grew by 51.6% and gross profit increased by 47.7%, significantly surpassing our initial growth target of 30% set at the beginning of the fiscal year.
Regarding operating profit, we initially provided conservative forecasts considering seasonal fluctuations in the fourth quarter and the impact of year-end accounting adjustments. However, due to steady performance, operating profit in the fourth quarter increased by 461 million yen compared to the same quarter of the previous year. As a result, operating profit for the fiscal year ending December 2024 reached 2.56 billion yen, exceeding both our initial forecast of 1.25 billion yen announced at the beginning of the fiscal year and the revised forecast of 2.4 billion yen announced on November 14.
Furthermore, due to fluctuations in the foreign exchange market, we recorded a foreign exchange gain of 227 million yen in the fourth quarter (and 61 million yen for the full year). Additionally, after reviewing the recoverability of deferred tax assets based on improved current profitability and future performance outlook, we decided to record deferred tax assets at our subsidiaries. As a result, we recorded an income tax deferred of -374 million yen (- as gain) in the fourth quarter and of 409 million yen (- as gain) for the fiscal year ending December 2024. Due to these factors, net income attributable to owners of the parent for the fiscal year ending December 2024 amounted to 2.34 billion yen, significantly exceeding the most recently announced forecast of 1.58 billion yen. However, since the foreign exchange gains and recording of deferred tax assets are non-recurring items, we believe that figures excluding these impacts should be considered as the reference level for evaluation.
Based on steady business performance and improved profitability, we made an upward revision to our full-year forecast for the fiscal year ending December 2024 on November 14, 2024. Subsequently, with continued strong performance in the fourth quarter, our actual results for the fiscal year ending December 2024 exceeded the revised forecast, with revenue achieving 103.3% and gross profit reaching 102.5% of the revised forecast. Compared to the previous fiscal year, revenue grew by 51.6% and gross profit increased by 47.7%, significantly surpassing our initial growth target of 30% set at the beginning of the fiscal year.
Regarding operating profit, we initially provided conservative forecasts considering seasonal fluctuations in the fourth quarter and the impact of year-end accounting adjustments. However, due to steady performance, operating profit in the fourth quarter increased by 461 million yen compared to the same quarter of the previous year. As a result, operating profit for the fiscal year ending December 2024 reached 2.56 billion yen, exceeding both our initial forecast of 1.25 billion yen announced at the beginning of the fiscal year and the revised forecast of 2.4 billion yen announced on November 14.
Furthermore, due to fluctuations in the foreign exchange market, we recorded a foreign exchange gain of 227 million yen in the fourth quarter (and 61 million yen for the full year). Additionally, after reviewing the recoverability of deferred tax assets based on improved current profitability and future performance outlook, we decided to record deferred tax assets at our subsidiaries. As a result, we recorded an income tax deferred of -374 million yen (- as gain) in the fourth quarter and of 409 million yen (- as gain) for the fiscal year ending December 2024. Due to these factors, net income attributable to owners of the parent for the fiscal year ending December 2024 amounted to 2.34 billion yen, significantly exceeding the most recently announced forecast of 1.58 billion yen. However, since the foreign exchange gains and recording of deferred tax assets are non-recurring items, we believe that figures excluding these impacts should be considered as the reference level for evaluation.
Which business segments and regions showed the highest growth rates in the fourth quarter of the fiscal year ending December 2024?
Disclosed on February 14, 2025
All business segments continue to demonstrate solid growth. The year-on-year growth rate in gross profit, which we consider the most important indicator for our group, showed increases of 34% in the Marketing Business, 34% in the D2C/E-Commerce Business, and 58% in the Partner Growth Business. In the Marketing Business, influencer marketing is driving growth across all regions. In the D2C/E-Commerce Business, while the creator-focused e-commerce business is showing stable growth as we prioritize profitability over expansion for scale, the enterprise e-commerce business is expanding steadily through the acquisition of new customers seeking cross-border expansion in Asia. The enterprise ecommerce business alone achieved a year-on-year gross profit growth rate of 46%. In the Partner Growth Business, the creator-focused business maintains high growth through continuous acquisition of new creators.
By region, we achieved growth across all areas, with year-on-year gross profit growth rates of 21% in Japan and Korea, 70% in Southeast Asia, and 49% in other regions (India and Greater China). The growth in Southeast Asia is partly attributed to the strong performance of our recently acquired companies, DDI and Arche (even excluding their revenue, the region's year-on-year growth rate remained high at 70%), along with significant contributions from the expansion of enterprise support in e-commerce and creator growth support. While the growth rate in Japan and Korea remains relatively low due to the large composition ratio of publisher growth support services, which has recently shown slower growth, each business segment is performing steadily. We have no major concerns about the business environment or outlook and expect continued stable growth.
All business segments continue to demonstrate solid growth. The year-on-year growth rate in gross profit, which we consider the most important indicator for our group, showed increases of 34% in the Marketing Business, 34% in the D2C/E-Commerce Business, and 58% in the Partner Growth Business. In the Marketing Business, influencer marketing is driving growth across all regions. In the D2C/E-Commerce Business, while the creator-focused e-commerce business is showing stable growth as we prioritize profitability over expansion for scale, the enterprise e-commerce business is expanding steadily through the acquisition of new customers seeking cross-border expansion in Asia. The enterprise ecommerce business alone achieved a year-on-year gross profit growth rate of 46%. In the Partner Growth Business, the creator-focused business maintains high growth through continuous acquisition of new creators.
By region, we achieved growth across all areas, with year-on-year gross profit growth rates of 21% in Japan and Korea, 70% in Southeast Asia, and 49% in other regions (India and Greater China). The growth in Southeast Asia is partly attributed to the strong performance of our recently acquired companies, DDI and Arche (even excluding their revenue, the region's year-on-year growth rate remained high at 70%), along with significant contributions from the expansion of enterprise support in e-commerce and creator growth support. While the growth rate in Japan and Korea remains relatively low due to the large composition ratio of publisher growth support services, which has recently shown slower growth, each business segment is performing steadily. We have no major concerns about the business environment or outlook and expect continued stable growth.
Which business segments and regions demonstrated the highest growth rates for the full fiscal year ending December 2024?
Disclosed on February 14, 2025
The fourth quarter is our high season, and in 2024, it accounted for 30% of our total gross profit. As with the fourth quarter performance, we achieved business growth across all businesses and regions throughout the year. Looking at individual business segments, the year-on-year growth rate in gross profit, which we consider the most important indicator for our group, showed increases of 33% in the Marketing Business, 59% in the D2C/E-Commerce Business, and 67% in the Partner Growth Business.
In the Marketing Business, AnyTag, our influencer marketing platform which accounts for approximately 60% of the business, drove global growth. In the D2C/E-Commerce Business, we expanded our enterprise e-commerce business, particularly in Southeast Asia, through the rollout of new solutions including 'AnyAI', a data & AI integration platform, and 'AnyLive', an AI-generated live commerce platform, as well as contributions from our wholly-owned subsidiaries DDI and Arche. As of the end of December 2024, the number of brands we support grew to 223 brands (comprising 47 creator brands and 176 enterprise brands).
In the Partner Growth Business, while our publisher growth support services were affected by changes in video advertising policies across major networks - an industry-wide trend that impacted revenues of related solutions - we are seeing a gradual recovery. As of the end of December 2024, the number of supported publishers increased by 173 from the previous year to 1,818. Regarding creator growth support, through diversification of support areas including YouTube Shorts support and steady acquisition of new global creators, the number of supported creators increased by 1,127 from the previous year-end to 2,910 as of the end of December 2024.
By region, year-on-year growth rates in gross profit showed solid growth across all regions, with Japan increasing by 27%, Southeast Asia by 81% (even excluding revenue from DDI and Arche, the region's year-on-year growth rate remained high at 73%), and other regions (India and Greater China) growing by 46%.
The fourth quarter is our high season, and in 2024, it accounted for 30% of our total gross profit. As with the fourth quarter performance, we achieved business growth across all businesses and regions throughout the year. Looking at individual business segments, the year-on-year growth rate in gross profit, which we consider the most important indicator for our group, showed increases of 33% in the Marketing Business, 59% in the D2C/E-Commerce Business, and 67% in the Partner Growth Business.
In the Marketing Business, AnyTag, our influencer marketing platform which accounts for approximately 60% of the business, drove global growth. In the D2C/E-Commerce Business, we expanded our enterprise e-commerce business, particularly in Southeast Asia, through the rollout of new solutions including 'AnyAI', a data & AI integration platform, and 'AnyLive', an AI-generated live commerce platform, as well as contributions from our wholly-owned subsidiaries DDI and Arche. As of the end of December 2024, the number of brands we support grew to 223 brands (comprising 47 creator brands and 176 enterprise brands).
In the Partner Growth Business, while our publisher growth support services were affected by changes in video advertising policies across major networks - an industry-wide trend that impacted revenues of related solutions - we are seeing a gradual recovery. As of the end of December 2024, the number of supported publishers increased by 173 from the previous year to 1,818. Regarding creator growth support, through diversification of support areas including YouTube Shorts support and steady acquisition of new global creators, the number of supported creators increased by 1,127 from the previous year-end to 2,910 as of the end of December 2024.
By region, year-on-year growth rates in gross profit showed solid growth across all regions, with Japan increasing by 27%, Southeast Asia by 81% (even excluding revenue from DDI and Arche, the region's year-on-year growth rate remained high at 73%), and other regions (India and Greater China) growing by 46%.
Has there been any change in the business outlook for the next few years? Which business segments do you expect to be the key drivers of the growth?
Disclosed on January 8, 2025
Our outlook remains unchanged from what we have communicated since our IPO in 2023. We believe we can continue to achieve high growth, supported by the significant growth potential in Asian markets. In particular, with Asian countries expected to experience medium to long-term macroeconomic growth driven by population increases, we anticipate sustained long-term growth in our overseas operations, especially in Southeast Asian markets, which are becoming increasingly important amid globalization.
We expect continued high growth particularly in our business for enterprise clients (Marketing segment and D2C/EC segment). In these segments, we support brand growth for enterprise clients across various industries, with a particular focus on clients who own consumer goods brands targeting individual consumers. For such clients, expansion into Asian markets is often a crucial initiative. We believe our unique capabilities and business scope provide significant differentiation from competitors and deliver high value to clients through: 1. our established support system across Asia and deep understanding of each market, 2. our technological capabilities to support visualization of data dispersed across countries, operational efficiency improvements, and generative AI implementation, and 3. our ability to provide comprehensive support from brand awareness to revenue generation throughout the marketing and EC processes support. Furthermore, beyond supporting Japanese companies' Asian expansion, we assist Asian companies from Korea, China, and Southeast Asia, as well as Western companies in their multi-country expansion. We anticipate that our addressable market size will continue to expand.
Additionally, in these enterprise brands support segments, there are a lot of M&A opportunities both domestically and internationally, and this business segment is easier to realize synergistic effects such as cross-selling to each segment's clients. Furthermore, as we grow both organically and through M&A and strengthen our support systems in each country, we believe we can create a virtuous cycle where our appeal to enterprise clients and our unique value proposition become increasingly stronger.
Moreover, we expect stable growth in our Partner Growth segment, which provides growth support for creators and publishers (operators of online media and mobile applications). These areas also represent growing markets globally, and we expect support opportunities to expand over the medium to long term as new creators and publishers emerge. In this context, our position is unique given our ability to provide global support and our technologically advantaged infrastructure and solutions. Furthermore, we can expect synergistic effects across our business portfolio in maximizing advertising demand, such as securing tie-up opportunities by leveraging our enterprise client network. By capitalizing on our competitive advantage of having extensive networks of enterprise clients, creators, and publishers across Asian countries, we aim to establish AnyMind as the go-to partner for business growth in Asia.
We also expect stable improvement in profitability. Over 50% of our SG&A expenses are personnel costs. Other expenses such as office rent and office-related costs are also linked to headcount, making the number of employees the primary driver of SG&A expenses. Operating across 15 countries and regions with multiple business lines, we need to maintain structures for acquiring and supporting local clients in each country, requiring workforce expansion as our business scale grows. However, we typically don't need to increase headcount at the same rate as revenue growth, so during periods of stable revenue growth, we can achieve gradual improvement in profitability.
In our full-year forecast for FY2024, we expect to achieve a significant improvement in operating profit margin from 2.2% in the previous year to 4.9%. Going forward, given the substantial growth potential in Asian markets, while we will continue to prioritize revenue growth, we aim to improve our operating profit margin by 50-100 basis points (0.5-1.0 percentage point improvement in operating profit margin) annually. We will continue to strengthen our position in Asian markets while pursuing both revenue growth and profitability.
Our outlook remains unchanged from what we have communicated since our IPO in 2023. We believe we can continue to achieve high growth, supported by the significant growth potential in Asian markets. In particular, with Asian countries expected to experience medium to long-term macroeconomic growth driven by population increases, we anticipate sustained long-term growth in our overseas operations, especially in Southeast Asian markets, which are becoming increasingly important amid globalization.
We expect continued high growth particularly in our business for enterprise clients (Marketing segment and D2C/EC segment). In these segments, we support brand growth for enterprise clients across various industries, with a particular focus on clients who own consumer goods brands targeting individual consumers. For such clients, expansion into Asian markets is often a crucial initiative. We believe our unique capabilities and business scope provide significant differentiation from competitors and deliver high value to clients through: 1. our established support system across Asia and deep understanding of each market, 2. our technological capabilities to support visualization of data dispersed across countries, operational efficiency improvements, and generative AI implementation, and 3. our ability to provide comprehensive support from brand awareness to revenue generation throughout the marketing and EC processes support. Furthermore, beyond supporting Japanese companies' Asian expansion, we assist Asian companies from Korea, China, and Southeast Asia, as well as Western companies in their multi-country expansion. We anticipate that our addressable market size will continue to expand.
Additionally, in these enterprise brands support segments, there are a lot of M&A opportunities both domestically and internationally, and this business segment is easier to realize synergistic effects such as cross-selling to each segment's clients. Furthermore, as we grow both organically and through M&A and strengthen our support systems in each country, we believe we can create a virtuous cycle where our appeal to enterprise clients and our unique value proposition become increasingly stronger.
Moreover, we expect stable growth in our Partner Growth segment, which provides growth support for creators and publishers (operators of online media and mobile applications). These areas also represent growing markets globally, and we expect support opportunities to expand over the medium to long term as new creators and publishers emerge. In this context, our position is unique given our ability to provide global support and our technologically advantaged infrastructure and solutions. Furthermore, we can expect synergistic effects across our business portfolio in maximizing advertising demand, such as securing tie-up opportunities by leveraging our enterprise client network. By capitalizing on our competitive advantage of having extensive networks of enterprise clients, creators, and publishers across Asian countries, we aim to establish AnyMind as the go-to partner for business growth in Asia.
We also expect stable improvement in profitability. Over 50% of our SG&A expenses are personnel costs. Other expenses such as office rent and office-related costs are also linked to headcount, making the number of employees the primary driver of SG&A expenses. Operating across 15 countries and regions with multiple business lines, we need to maintain structures for acquiring and supporting local clients in each country, requiring workforce expansion as our business scale grows. However, we typically don't need to increase headcount at the same rate as revenue growth, so during periods of stable revenue growth, we can achieve gradual improvement in profitability.
In our full-year forecast for FY2024, we expect to achieve a significant improvement in operating profit margin from 2.2% in the previous year to 4.9%. Going forward, given the substantial growth potential in Asian markets, while we will continue to prioritize revenue growth, we aim to improve our operating profit margin by 50-100 basis points (0.5-1.0 percentage point improvement in operating profit margin) annually. We will continue to strengthen our position in Asian markets while pursuing both revenue growth and profitability.
What is driving the remarkable growth in Southeast Asia, as seen in the regional breakdown of your financial results?
Disclosed on January 8, 2025
Our company's growth in Southeast Asia is driven by the synergistic effect between market growth and our company's strengths. In terms of market environment, high growth continues across marketing and the overall e-commerce market, due to factors such as a large young population and high social media usage rates. According to data from "Worldwide Ecommerce Forecast Update, eMarketer (July 2024)", the Southeast Asian e-commerce market continues to expand year by year. From 2021 to 2023, the Southeast Asian e-commerce market showed high growth with an average annual growth rate of 18%. Growth is expected to continue, with projections showing an increase from $138.6 billion in 2024 to $172 billion in 2027. Meanwhile, in terms of the competitive environment, we believe we can better leverage our market advantage as there are limited global companies and influential Southeast Asian startups in the market.
In this environment, our company has focused on Southeast Asia since its founding, and as of the end of September 2024, we employ 1,170 people and have established a strong operational structure and local network across Southeast Asia. We have established a unique position compared to our competitors through the deployment of our BPaaS model, which supports both technology and operations, as well as our multi-country expansion, and we continue to see high growth across all our business operations. Additionally, we have established a structure capable of meeting cross-border expansion needs, such as supporting the Southeast Asian expansion of companies from within Asia including Japanese and Korean brands, and helping global brands expand into multiple Southeast Asian countries. We believe we have the pipeline and business environment in place for continued growth going forward.
Furthermore, our growing market presence, driven by our business scale and credibility as a listed company, has relatively reduced the challenges in acquiring new clients across our business segments, recruiting talent, and securing business partners. In particular, we believe our positioning in Southeast Asia has significantly improved since our IPO, especially in terms of talent recruitment and M&A opportunities. We aim to maintain our high growth trajectory by leveraging our current market advantages.
Our company's growth in Southeast Asia is driven by the synergistic effect between market growth and our company's strengths. In terms of market environment, high growth continues across marketing and the overall e-commerce market, due to factors such as a large young population and high social media usage rates. According to data from "Worldwide Ecommerce Forecast Update, eMarketer (July 2024)", the Southeast Asian e-commerce market continues to expand year by year. From 2021 to 2023, the Southeast Asian e-commerce market showed high growth with an average annual growth rate of 18%. Growth is expected to continue, with projections showing an increase from $138.6 billion in 2024 to $172 billion in 2027. Meanwhile, in terms of the competitive environment, we believe we can better leverage our market advantage as there are limited global companies and influential Southeast Asian startups in the market.
In this environment, our company has focused on Southeast Asia since its founding, and as of the end of September 2024, we employ 1,170 people and have established a strong operational structure and local network across Southeast Asia. We have established a unique position compared to our competitors through the deployment of our BPaaS model, which supports both technology and operations, as well as our multi-country expansion, and we continue to see high growth across all our business operations. Additionally, we have established a structure capable of meeting cross-border expansion needs, such as supporting the Southeast Asian expansion of companies from within Asia including Japanese and Korean brands, and helping global brands expand into multiple Southeast Asian countries. We believe we have the pipeline and business environment in place for continued growth going forward.
Furthermore, our growing market presence, driven by our business scale and credibility as a listed company, has relatively reduced the challenges in acquiring new clients across our business segments, recruiting talent, and securing business partners. In particular, we believe our positioning in Southeast Asia has significantly improved since our IPO, especially in terms of talent recruitment and M&A opportunities. We aim to maintain our high growth trajectory by leveraging our current market advantages.
To what extent did exchange rates impact the growth rate in the second quarter of the fiscal year ending December 2024? What impact do you anticipate if the yen continues to appreciate?
Disclosed on August 14, 2024
Our company primarily receives revenue in local currencies in the countries where we operate, so our financial report figures in Japanese yen are linked to the exchange rates of each country's local currency. Since a large portion of our sales comes from domestic bases, about 57% of our overseas gross profit was affected by exchange rates. In the second quarter of fiscal year 2024, after the Japanese yen, the Thai baht, Singapore dollar, and Hong Kong dollar had the largest impact, followed by the Indonesian rupiah, Taiwan dollar, Vietnamese dong, Philippine peso, and others. When applying a weighted average based on the gross profit generated in the subsidiaries' locations, we estimate that the positive impact of exchange rate fluctuations on the year-on-year growth rate in Japanese yen terms is approximately 5.2% for the second quarter of FY2024.
Since expenses such as selling, general, and administrative (SG&A) costs are also incurred in local currencies across different countries, the impact is partially offset the operating profit and all the indicators below. If gross profit is positively impacted by yen depreciation, SG&A expenses will similarly increase. On the other hand, should the yen appreciate against all local currencies in Asia in the future, gross profit would decrease, but SG&A expenses would similarly decline, leading to a limited impact of exchange rate fluctuations on operating profit.
As stated above, even if there is a trend towards a stronger yen, we do not anticipate a significant impact on operating profit or cash flow in each country. The impact would be limited to the disclosed figures for revenue and gross profit in Japanese yen. Furthermore, we assume that recently, the fluctuations between Asian currencies and the yen tend to be smaller compared to the exchange rate fluctuations between the US dollar and the yen.
Our company primarily receives revenue in local currencies in the countries where we operate, so our financial report figures in Japanese yen are linked to the exchange rates of each country's local currency. Since a large portion of our sales comes from domestic bases, about 57% of our overseas gross profit was affected by exchange rates. In the second quarter of fiscal year 2024, after the Japanese yen, the Thai baht, Singapore dollar, and Hong Kong dollar had the largest impact, followed by the Indonesian rupiah, Taiwan dollar, Vietnamese dong, Philippine peso, and others. When applying a weighted average based on the gross profit generated in the subsidiaries' locations, we estimate that the positive impact of exchange rate fluctuations on the year-on-year growth rate in Japanese yen terms is approximately 5.2% for the second quarter of FY2024.
Since expenses such as selling, general, and administrative (SG&A) costs are also incurred in local currencies across different countries, the impact is partially offset the operating profit and all the indicators below. If gross profit is positively impacted by yen depreciation, SG&A expenses will similarly increase. On the other hand, should the yen appreciate against all local currencies in Asia in the future, gross profit would decrease, but SG&A expenses would similarly decline, leading to a limited impact of exchange rate fluctuations on operating profit.
As stated above, even if there is a trend towards a stronger yen, we do not anticipate a significant impact on operating profit or cash flow in each country. The impact would be limited to the disclosed figures for revenue and gross profit in Japanese yen. Furthermore, we assume that recently, the fluctuations between Asian currencies and the yen tend to be smaller compared to the exchange rate fluctuations between the US dollar and the yen.
Why is the marketing business continuing to grow even though the industry trends are not favorable?
Disclosed on April 1, 2024
The momentum of the overall marketing market may not be very favorable at the moment, but influencer marketing, which is an advanced marketing method, is expected to grow globally, with similar trends expected in Asia. As a reference, according to "The State of Influencer Marketing 2024" published by Influencer Marketing Hub, the global influencer marketing market size is expected to grow from $16.4 billion in 2022 to $24 billion in 2024, at an average annual growth rate of 21%.
Our marketing business is largely driven by revenue from the influencer marketing platform "AnyTag". Its strength lies in its ability to conduct campaigns utilizing a network and data of 630,000 influencers spread across Asia. We select the optimal influencers based on follower analysis data, and provide consistent support from strategy design to casting proposals and reporting. Additionally, by analyzing trends and users on social media, and measuring user reactions to posts and the effectiveness of influencer marketing initiatives, we accelerate the PDCA cycle, maximizing the effectiveness of marketing strategies.
Furthermore, we have strengthened our collaboration with major e-commerce marketplaces. Since June 2023, we have been able to conduct performance-based marketing on Lazada and Shopee, the largest e-commerce marketplaces in Southeast Asia, through collaboration. There is a high demand for influencer marketing execution support utilizing data in Asia, and we have achieved stable growth due to an increasing number of enterprises clients utilizing our services and an expansion in unit prices of projects.
The momentum of the overall marketing market may not be very favorable at the moment, but influencer marketing, which is an advanced marketing method, is expected to grow globally, with similar trends expected in Asia. As a reference, according to "The State of Influencer Marketing 2024" published by Influencer Marketing Hub, the global influencer marketing market size is expected to grow from $16.4 billion in 2022 to $24 billion in 2024, at an average annual growth rate of 21%.
Our marketing business is largely driven by revenue from the influencer marketing platform "AnyTag". Its strength lies in its ability to conduct campaigns utilizing a network and data of 630,000 influencers spread across Asia. We select the optimal influencers based on follower analysis data, and provide consistent support from strategy design to casting proposals and reporting. Additionally, by analyzing trends and users on social media, and measuring user reactions to posts and the effectiveness of influencer marketing initiatives, we accelerate the PDCA cycle, maximizing the effectiveness of marketing strategies.
Furthermore, we have strengthened our collaboration with major e-commerce marketplaces. Since June 2023, we have been able to conduct performance-based marketing on Lazada and Shopee, the largest e-commerce marketplaces in Southeast Asia, through collaboration. There is a high demand for influencer marketing execution support utilizing data in Asia, and we have achieved stable growth due to an increasing number of enterprises clients utilizing our services and an expansion in unit prices of projects.
When are financial results announced?
Our fiscal year ends on December 31, and we disclose our financial results on a quarterly basis. Please refer to the IR Calendar for the most recent financial announcement schedule.
What/How is the current performance?
Information on business performance can be found in Financial Highlights, and information on financial results can be found in IR Library .
What is your business outlook?
The outlook for our business performance can be found in the Summary of . Please visit our Financial Results page to view our latest financial statements.
About Stock Information
Please highlight any notable points regarding the current shareholder composition that we should be aware of.
Disclosed on February 14, 2025
Since our founding, particularly during our pre-IPO period, we have received tremendous support from venture capital and other financial investors (hereinafter referred to as "VC investors"). Through their provision of growth capital and valuable management advice, we recognize that we have been able to establish our business foundation and achieve sustained growth. We would like to take this opportunity to express our deepest gratitude.
Generally, funds operated by venture capital firms have a redemption period of approximately 10 years, and they need to recover their investments (through the sale of acquired shares) after a certain period following their initial investment. Therefore, when there is a significant time gap between pre-IPO fundraising and the actual IPO, a situation known as "overhang" (Note 1) may occur, where share sales either take place or are expected to take place within a relatively short period after the IPO, potentially deteriorating the supply-demand balance of the shares. While stock prices fluctuate due to various factors including market conditions and business performance, a deterioration in the supply-demand balance can be one factor that suppresses stock prices.
In our case, due to our history of active fundraising since our founding, we took steps to mitigate post-IPO overhang concerns in July 2022, just before our IPO, by welcoming new shareholders who both invested in our company and purchased existing shares from shareholders (who had held their investments for a certain period). However, when we went public in March 2023, the overall stock market was weak, which resulted in a limited offering size at IPO, and the liquidity of our shares, both during the initial public offering and afterward, was not sufficient. As a result, we have received multiple concerns from investors regarding the overhang issue after our IPO.
However, looking back at the changes in our shareholder composition since our IPO, our VC investors who invested before the IPO have gradually reduced their shareholdings based on their specific circumstances, including fund redemption deadlines (please refer to Graph 1 below). As a result, as of the end of December 2024, excluding the shares invested in July 2022 just before the IPO (Pre-IPO), both the number of pre-IPO VC investors and the number of shares held by VC investors have already reached limited levels. Furthermore, to the best of our knowledge, we have not identified any major shareholders with intentions to sell shares on a scale that would significantly impact the market, and we believe that shortterm overhang concerns are now limited.
Furthermore, looking at the changes in our shareholder distribution since our IPO (please refer to Graph 2 below), the shares previously held by VC investors have been widely distributed among domestic and international institutional investors. Particularly in the six months leading up to December 2024, shareholdings increased by approximately 2.5 million shares among foreign institutional investors (Note 2) and approximately 2.1 million shares among domestic institutional investors (Note 2). We view this increase in institutional investor holdings as evidence that these investors understand and appreciate our growth potential and business model, and we would like to express our renewed gratitude for their continued support.
Moving forward, we will further strengthen our IR activities to help individual investors, as well as domestic and international institutional investors, better understand our business. We continue to be grateful for the support of all our shareholders and will devote our full efforts toward enhancing sustainable corporate value.
(Note 1) "Overhang" concerns refer to concerns about a potential deterioration in the supply-demand balance of shares due to anticipated large-scale share sales by major shareholders and others in the future.
(Note 2) Domestic institutional investors include general corporations, and foreign institutional investors include some individual investors.
Since our founding, particularly during our pre-IPO period, we have received tremendous support from venture capital and other financial investors (hereinafter referred to as "VC investors"). Through their provision of growth capital and valuable management advice, we recognize that we have been able to establish our business foundation and achieve sustained growth. We would like to take this opportunity to express our deepest gratitude.
Generally, funds operated by venture capital firms have a redemption period of approximately 10 years, and they need to recover their investments (through the sale of acquired shares) after a certain period following their initial investment. Therefore, when there is a significant time gap between pre-IPO fundraising and the actual IPO, a situation known as "overhang" (Note 1) may occur, where share sales either take place or are expected to take place within a relatively short period after the IPO, potentially deteriorating the supply-demand balance of the shares. While stock prices fluctuate due to various factors including market conditions and business performance, a deterioration in the supply-demand balance can be one factor that suppresses stock prices.
In our case, due to our history of active fundraising since our founding, we took steps to mitigate post-IPO overhang concerns in July 2022, just before our IPO, by welcoming new shareholders who both invested in our company and purchased existing shares from shareholders (who had held their investments for a certain period). However, when we went public in March 2023, the overall stock market was weak, which resulted in a limited offering size at IPO, and the liquidity of our shares, both during the initial public offering and afterward, was not sufficient. As a result, we have received multiple concerns from investors regarding the overhang issue after our IPO.
However, looking back at the changes in our shareholder composition since our IPO, our VC investors who invested before the IPO have gradually reduced their shareholdings based on their specific circumstances, including fund redemption deadlines (please refer to Graph 1 below). As a result, as of the end of December 2024, excluding the shares invested in July 2022 just before the IPO (Pre-IPO), both the number of pre-IPO VC investors and the number of shares held by VC investors have already reached limited levels. Furthermore, to the best of our knowledge, we have not identified any major shareholders with intentions to sell shares on a scale that would significantly impact the market, and we believe that shortterm overhang concerns are now limited.
Furthermore, looking at the changes in our shareholder distribution since our IPO (please refer to Graph 2 below), the shares previously held by VC investors have been widely distributed among domestic and international institutional investors. Particularly in the six months leading up to December 2024, shareholdings increased by approximately 2.5 million shares among foreign institutional investors (Note 2) and approximately 2.1 million shares among domestic institutional investors (Note 2). We view this increase in institutional investor holdings as evidence that these investors understand and appreciate our growth potential and business model, and we would like to express our renewed gratitude for their continued support.Moving forward, we will further strengthen our IR activities to help individual investors, as well as domestic and international institutional investors, better understand our business. We continue to be grateful for the support of all our shareholders and will devote our full efforts toward enhancing sustainable corporate value.
(Note 1) "Overhang" concerns refer to concerns about a potential deterioration in the supply-demand balance of shares due to anticipated large-scale share sales by major shareholders and others in the future.(Note 2) Domestic institutional investors include general corporations, and foreign institutional investors include some individual investors.
What are your thoughts on transitioning to the Prime Market?
Disclosed on November 14, 2024
Since our listing on the Growth Market in March 2023, thanks to shareholder support and business growth, we understand that we currently meet all formal requirements for the Prime Market except for the "profit or revenue" criterion. Regarding the "profit or revenue" requirement, there is a criterion of "total profit for the most recent two years must be 2.5 billion yen or more." If we achieve the revised consolidated earnings forecast announced on November 14th for FY2024, we would meet this requirement (based on the total profit for FY2023 and FY2024).
While we have not made any decisions regarding transitioning to the Prime Market at this time, when we meet all requirements for listing on the Prime Market (including non-formal requirements), we will consider it as one of our important management options.
Since our listing on the Growth Market in March 2023, thanks to shareholder support and business growth, we understand that we currently meet all formal requirements for the Prime Market except for the "profit or revenue" criterion. Regarding the "profit or revenue" requirement, there is a criterion of "total profit for the most recent two years must be 2.5 billion yen or more." If we achieve the revised consolidated earnings forecast announced on November 14th for FY2024, we would meet this requirement (based on the total profit for FY2023 and FY2024).
While we have not made any decisions regarding transitioning to the Prime Market at this time, when we meet all requirements for listing on the Prime Market (including non-formal requirements), we will consider it as one of our important management options.
Are measures to improve stock liquidity being considered?
Disclosed on April 1, 2024
After conducting the secondary offering of stock announced last September, the liquidity of our company's stocks has relatively improved, and we have more shareholders holding our stocks. Therefore, we believe that the increase in the floating stock ratio due to the offering has had a certain effect, but we still have not reached the desired level of liquidity. This is not only due to the floating stock ratio but also because we need to improve the recognition of our company and awareness of our business among investors. Therefore, we do not have any plans for stock offerings at this time, and we want to focus on enhancing the recognition of our company for the time being.
In order to ensure that institutional and individual investors fully understand the potential and attractiveness of our business and the Asian market, we are committed to strengthening disclosure and maintaining ongoing communication. We believe it is crucial to build trust from the stock market by demonstrating progress in performance in line with investors' expectations, including achieving disclosed performance forecasts. Therefore, we will continue to strive in our business endeavors, solidifying our business foundation in Asia.
After conducting the secondary offering of stock announced last September, the liquidity of our company's stocks has relatively improved, and we have more shareholders holding our stocks. Therefore, we believe that the increase in the floating stock ratio due to the offering has had a certain effect, but we still have not reached the desired level of liquidity. This is not only due to the floating stock ratio but also because we need to improve the recognition of our company and awareness of our business among investors. Therefore, we do not have any plans for stock offerings at this time, and we want to focus on enhancing the recognition of our company for the time being.
In order to ensure that institutional and individual investors fully understand the potential and attractiveness of our business and the Asian market, we are committed to strengthening disclosure and maintaining ongoing communication. We believe it is crucial to build trust from the stock market by demonstrating progress in performance in line with investors' expectations, including achieving disclosed performance forecasts. Therefore, we will continue to strive in our business endeavors, solidifying our business foundation in Asia.
Please explain the background and purpose of the recent secondary offering.
Disclosed on October 16, 2023
After our company's listing in March 2023, we recognized that the low floating stock ratio and limited stock liquidity were significant management challenges. We understand that stock liquidity is often a crucial factor for investors, both domestically and internationally, in their investment decisions. To enhance the company's value in the medium- to long-term, we determined that improving stock liquidity by engaging a broader range of investors was crucial. Despite various considerations, we concluded that increasing the floating stock ratio by existing shareholders selling their holding stocks partially was a necessary step toward addressing this challenge.
We understand that stock liquidity is influenced by various factors and that demonstrating our stable growth and ongoing business progress in global markets, as well as ensuring investors understand our business through continuous investor relations activities, are paramount. However, as a first step, it is desirable to increase the floating stock ratio.
In this context, we explained our recognition of the issue and our company's perspective to major shareholders, including the sellers involved in the recent secondary offering. We requested their cooperation to secure a sufficient number of shares for sale to improve stock liquidity and expand the investor base. The background to their agreement and cooperation lies in their understanding of our perspective and willingness to support our requested actions. While we did not receive requests from sellers to divest their holdings at this time, our major shareholders agreed to participate in this offering. Additionally, some of major shareholders have accepted a 90-day lock-up period after the sale, even if they did not participate in this offering.
After our company's listing in March 2023, we recognized that the low floating stock ratio and limited stock liquidity were significant management challenges. We understand that stock liquidity is often a crucial factor for investors, both domestically and internationally, in their investment decisions. To enhance the company's value in the medium- to long-term, we determined that improving stock liquidity by engaging a broader range of investors was crucial. Despite various considerations, we concluded that increasing the floating stock ratio by existing shareholders selling their holding stocks partially was a necessary step toward addressing this challenge.
We understand that stock liquidity is influenced by various factors and that demonstrating our stable growth and ongoing business progress in global markets, as well as ensuring investors understand our business through continuous investor relations activities, are paramount. However, as a first step, it is desirable to increase the floating stock ratio.
In this context, we explained our recognition of the issue and our company's perspective to major shareholders, including the sellers involved in the recent secondary offering. We requested their cooperation to secure a sufficient number of shares for sale to improve stock liquidity and expand the investor base. The background to their agreement and cooperation lies in their understanding of our perspective and willingness to support our requested actions. While we did not receive requests from sellers to divest their holdings at this time, our major shareholders agreed to participate in this offering. Additionally, some of major shareholders have accepted a 90-day lock-up period after the sale, even if they did not participate in this offering.
What is the trading unit for stocks?
The trading unit is 100 shares.
When is the annual general meeting of shareholders?
The annual general meeting of shareholders is held in late March every year.
What are the policy about dividends?
We aim to increase our corporate value over the medium to long term and on a sustainable basis, and we believe that upfront investments in services with an eye on future growth is the best way to return profits to shareholders. Therefore, we have not paid dividends since our establishment.
The Company's Articles of Incorporation stipulate that the Company may pay an interim dividend, while the Company's basic policy is to pay dividends from surplus twice a year: an interim dividend and a year-end dividend. In accordance with the provisions of Article 459, Paragraph 1 of the Companies Act, the Company stipulates in its Articles of Incorporation that the Board of Directors shall be the decision-making body for dividends from surplus, except as otherwise provided by laws and regulations.
The Company's Articles of Incorporation stipulate that the Company may pay an interim dividend, while the Company's basic policy is to pay dividends from surplus twice a year: an interim dividend and a year-end dividend. In accordance with the provisions of Article 459, Paragraph 1 of the Companies Act, the Company stipulates in its Articles of Incorporation that the Board of Directors shall be the decision-making body for dividends from surplus, except as otherwise provided by laws and regulations.
Who should I contact to change my address or complete other stock-related procedures?
You should contact the account management institution (securities company) where you have opened your account. Alternatively, you may contact Mitsubishi UFJ Trust and Banking Corporation, the administrator of the shareholders' register. Please refer to the Stock Memo for contact numbers and other information.
About M&A
Could you please provide information about the future direction regarding M&A?
Disclosed on April 2, 2025
We analyze business and growth opportunities along two axes - business and region - and strategically utilize M&A. Our main objectives are to acquire management teams, talent, and local networks, with a focus on strengthening organizational capabilities and business foundations.
Since our foundation, we have completed a total of 10 M&A deals (5 domestic/5 overseas) and have focused on creating synergies through business integration post-acquisition. Comparing sales immediately after acquisition to December 2024, we have achieved an average growth of 4.4 times. While previously based on approximately 1-2 deals annually, we are considering gradually increasing this pace going forward.
Current priority areas are enterprise e-commerce and related peripheral businesses, focusing on companies that are already generating revenue while balancing risk. Regarding financing, with a low D/E ratio of 0.2 times as of the end of 2024, continue to consider financing primarily through interest-bearing debt.
We analyze business and growth opportunities along two axes - business and region - and strategically utilize M&A. Our main objectives are to acquire management teams, talent, and local networks, with a focus on strengthening organizational capabilities and business foundations.
Since our foundation, we have completed a total of 10 M&A deals (5 domestic/5 overseas) and have focused on creating synergies through business integration post-acquisition. Comparing sales immediately after acquisition to December 2024, we have achieved an average growth of 4.4 times. While previously based on approximately 1-2 deals annually, we are considering gradually increasing this pace going forward.
Current priority areas are enterprise e-commerce and related peripheral businesses, focusing on companies that are already generating revenue while balancing risk. Regarding financing, with a low D/E ratio of 0.2 times as of the end of 2024, continue to consider financing primarily through interest-bearing debt.
What is your company’s policy, if any, when considering M&A, and what is your policy for reducing risks related to M&A?
Disclosed on May 12, 2023
The following are points of focus when conducting M&As:
1. Resolution/deep understanding for the target business
Our basic policy is to consider M&A in a manner that complements existing businesses and business domains. Therefore, when considering M&A, we believe that having a high resolution of the business environment, business model, and risks and opportunities of the target business will form the basis for various discussions, including management synergies and business integration.
2. Direction and culture fit with the target company’s management members
In principle, our M&A activities are based on the premise of business integration, and the objective is often to acquire organizations, networks, etc., through M&A. One of these is the acquisition of talented management members, and we aim to strengthen our own management structure by having people with extensive management experience join us through M&A. In the process of conducting M&A, we hold discussions with the target company’s management team to gain a mutual understanding of not only the business of both companies, but also the direction and values that the management team is aiming for as individuals. We also believe that having the target company’s management team makes the integration process effective in accelerating the process.
3. Possibility of multiple synergies across different time periods
When conducting M&A activities, it is important that we assume synergies between the two companies. In many cases, we can expect immediate synergies based on our network, organization and technology (e.g., cross-border initiatives, etc.), since we are constantly expanding into multiple business areas and businesses. We also believe that it is desirable to be able to envision as many synergistic scenarios as possible, and to strike a balance between synergies that can be realized immediately and synergies that are expected to occur over the longer term.
In addition, we take the following measures to reduce the risks involved in the M&A process, which has inherent elements of uncertainty.
1. Proactive business integration after M&A
In principle, we aim to quickly unify the governance structure and granularity of business management, by proactively integrating organizations, businesses and systems after M&A, and integrate them into our business management system and structure. We view this as an important step to ensure stable growth of the Group over the medium to long term by creating synergies, identifying business risks and opportunities, and aligning corporate culture through business integration.
2. Implement a multifaceted due diligence process prior to M&A
When implementing M&A, our internal policy is to appoint local advisors for financial, tax, and legal due diligence, as well as valuation evaluation of the target company, and conduct analysis based on the risks and constraints unique to each country. In addition, as part of the process of deepening our understanding of the business, our team and management team will conduct due diligence on the business to assess the probability of the business plan and growth potential and risks of the business model. Through this multifaceted evaluation process, we understand the risk associated with the target business and verify the possibility of business integration.
The following are points of focus when conducting M&As:
1. Resolution/deep understanding for the target business
Our basic policy is to consider M&A in a manner that complements existing businesses and business domains. Therefore, when considering M&A, we believe that having a high resolution of the business environment, business model, and risks and opportunities of the target business will form the basis for various discussions, including management synergies and business integration.
2. Direction and culture fit with the target company’s management members
In principle, our M&A activities are based on the premise of business integration, and the objective is often to acquire organizations, networks, etc., through M&A. One of these is the acquisition of talented management members, and we aim to strengthen our own management structure by having people with extensive management experience join us through M&A. In the process of conducting M&A, we hold discussions with the target company’s management team to gain a mutual understanding of not only the business of both companies, but also the direction and values that the management team is aiming for as individuals. We also believe that having the target company’s management team makes the integration process effective in accelerating the process.
3. Possibility of multiple synergies across different time periods
When conducting M&A activities, it is important that we assume synergies between the two companies. In many cases, we can expect immediate synergies based on our network, organization and technology (e.g., cross-border initiatives, etc.), since we are constantly expanding into multiple business areas and businesses. We also believe that it is desirable to be able to envision as many synergistic scenarios as possible, and to strike a balance between synergies that can be realized immediately and synergies that are expected to occur over the longer term.
In addition, we take the following measures to reduce the risks involved in the M&A process, which has inherent elements of uncertainty.
1. Proactive business integration after M&A
In principle, we aim to quickly unify the governance structure and granularity of business management, by proactively integrating organizations, businesses and systems after M&A, and integrate them into our business management system and structure. We view this as an important step to ensure stable growth of the Group over the medium to long term by creating synergies, identifying business risks and opportunities, and aligning corporate culture through business integration.
2. Implement a multifaceted due diligence process prior to M&A
When implementing M&A, our internal policy is to appoint local advisors for financial, tax, and legal due diligence, as well as valuation evaluation of the target company, and conduct analysis based on the risks and constraints unique to each country. In addition, as part of the process of deepening our understanding of the business, our team and management team will conduct due diligence on the business to assess the probability of the business plan and growth potential and risks of the business model. Through this multifaceted evaluation process, we understand the risk associated with the target business and verify the possibility of business integration.
