Rakuten wesentlich besser als Rocket

Rakuten, Inc. (RKUNY) CEO Hiroshi Mikitani on Q3 2020 Results - Earnings Call Transcript
Nov. 12, 2020 10:07 AM ET
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About: Rakuten, Inc. (RKUNY), RKUNF

seekingalpha.com/article/...-results-earnings-call-transcript

Rakuten Viki launches private Watch Parties to bring fans together (even while they’re apart)

2 hours ago

U.S. fans of Asian entertainment can now enjoy their favorite movies and shows together — even if they’re hundreds of miles apart — thanks to Rakuten Viki’s new virtual Watch Parties feature.
With over 1,400 TV shows and movies from Korea, Japan, mainland China, Taiwan and Thailand, Rakuten Viki is known as the online destination for Asian dramas and movies. The platform’s innovative community subtitling feature has made a vast library of foreign language content available to audiences around the world, helping drive the Asian entertainment wave of recent years.

In the first half of 2020, Viki enjoyed growth of over 50% in its subscription business, surpassing 15 million monthly active users among more than 32 million registered.
Currently, the feature is available for a selection of movies and shows, but Viki plans to expand the catalog in the near future and roll out Watch Parties for users around the world. And while the initial rollout is focused on the platform’s free content, the team is planning to implement private Watch Parties for premium content in the near future.

rakuten.today/blog/...iki-launches-private-watch-parties.html

year-on-year

Here is the waterfall chart of factors impacting non-GAAP operating income year-on-year. FinTech OI increased by ¥5.8 billion due to the impact of the new normal and cashless trends. Rakuten Ichiba and other businesses benefiting from advancing digital transformation also saw a boost in profits. On the other hand, the negative impact of COVID-19 hit businesses like Rakuten Travel, pushing down OI by ¥3.2 billion. Losses in the Mobile businesses continued to grow due to upfront investment, but the coverage area is steadily expanding due to the aggressive base station construction. Going forward, we aim to increase the number of users. By improving the quality of our communication services, we aim for profitability in Mobile as soon as possible.

seekingalpha.com/article/...nings-call-transcript?part=single

Global Membership1.4bn

One Brand: A single "Rakuten" brand for domestic and overseas services improves awareness and image of each service

One ID –Membership: More than 100 million users in Japan can use multiple services in the ecosystem with a single ID  

Rich data:Enormous purchasing data of more than 100 million users connected to demographics, such as age and gender, and consumer interests.

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Domestic E-Commerce-GMS
(GMS comprises Ichiba, Travel GTV on checkout basis,Books, Golf, Ticket, Fashion, Dream businesses, Beauty, Delivery, Rakuten24 (Direct), Auto business, Rakuma, Rebates
RakutenSeiyu Netsuper, etc. )

Q3/20: 1098.6 JPY bn (+11.7% YoY)

Jul-Aug Domestic EC: +15.6% YoY


Domestic E-Commerce Results

Revenue: 149,228 JPY mm (+ 17.2% YoY)

Operating Income: 15,237 JPY mm
(+ 0.9% YoY, + 12.0% YoY excl. logistics-related investments/cost)

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Airtel has been a member of the O-RAN ALLIANCE since its inception in 2018. Airtel was the first operator in India to commercially deploy a virtual RAN solution based on a disaggregated and open architecture defined by O-RAN. “We are delighted to partner with the global O-RAN community. Our engagement with Altiostar and NEC for demonstrating O-RAN O-DU and O-RU, 5G RCT and E2E performance is another step forward towards building 5G systems with open network architecture,” said Randeep Sekhon, CTO at Bharti Airtel.

Headquartered in India, Airtel is a global telecommunications company with operations in 18 countries across South Asia and Africa. The company ranks amongst the top three mobile operators globally and its mobile network covers a population of over two billion people. Airtel is India’s largest integrated telecom provider and the second largest mobile operator in Africa. At the end of September 2020, Airtel had approx. 440 mn customers across its operations.

www.altiostar.com/...ugfest-hosted-by-bharti-airtel-in-india/

Q3/20: +29.3% YoY

2 years CAGR
Jul/20 = 27.1
Aug/20 = 25.9
Sep/20 = 23.1

Ratio of users who made a purchase on Ichiba in Q2/20 repeating in Q3/20 = approx. 75%

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Rakuten Mobile accelerating rollout after lacklustre subscriber growth
By Harry Baldock, Total Telecom
Friday 13 November 20

The greenfield operator has not made quite the impact it had hoped in the Japanese market, but it is not done yet.

Rakuten Mobile has been touted as one of the world’s most disruptive operators this year, attempting to burst onto the Japanese telecoms scene with its fully virtualised RAN. However, the company has not made quite the splash it would have hoped, with the company’s Q3 results showing the company’s growth to be disappointing.

In an earnings call which took place on Wednesday, Rakuten Mobile’s CTO Tareq Amin explained that the company had roughly 1.6 million customers subscribed to its service. This is a total that is unlikely to have Japan’s rival telcos quaking in their boots – NTT DoCoMo boasts around 75 million subscribers and even the smallest of the big three, SoftBank, has over 23 million. Even worse, it is likely that Rakuten is making very little money from these subscribers at present, having offered the first three million subscribers free service for a year back when the company launched 4G commercially in April.
As a result, the operator is redoubling its efforts to expand its network coverage, now targetting 96% of Japan’s population by the end of 2021. The company plans to achieve this by rapidly rolling out 45,000 sites; this total number of sites is reportedly less than half that of its major rivals, as a result of Rakuten’s innovations in network architecture leading to 30–40% increased coverage per site, according to Amin.

Nonetheless, the pace of the rollout will still need to be impressive, with Rakuten reportedly doubling their monthly deployment targets to round 1,500 sites.

"We felt if you compare the cost of roaming and how much we pay for roaming, the acceleration of the build plan by five years has a significant return on investment to Rakuten," explained Amin.

So far, Rakuten Mobile have failed to make the immediate impact on the Japanese market that they had hoped but, with with such a major rollout in the works, their disruptive potential could still be realised.

www.totaltele.com/507870/...fter-lacklustre-subscriber-growth

das Netz funktioniert und die Qualität stimmt - der Rest ergibt sich zwar nicht ganz von allein, aber das sind wichtige Voraussetzungen.

GMS of fashion and apparel business of Rakuten (Ichiba+ Rakuten Fashion) is no.1 in Japan E-commerce

GMS of fashion and apparel business of Rakuten is Approx. 2.3 times of biggest rival ZOZOTOWN

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

„Most importantly, all of this was done based on trust, resilience and secure platform. Opensignal recognize Rakuten Mobile as a global leader for best 4G experience and availability.“

seekingalpha.com/article/...nings-call-transcript?part=single

The Rakuten Group achieved strong result in the third quarter. Revenue grew by double digit year-on-year. Even during the pandemic, we took advantage of the strengths of our diverse businesses and the Rakuten Ecosystem. Non-GAAP operating income declined as a result of aggressive upfront investment in Mobile and logistics. Excluding profit and losses from Mobile, logistics and the investments businesses that were affected by market fluctuation due to the pandemic, profits have increased significantly.

seekingalpha.com/article/...nings-call-transcript?part=single

Market Share by Shopping GTV in Japan: No.1

Number of Card Holders as of Sep 2020:  20.76mm

No.1 in Customer Satisfaction Survey*for 11 Consecutive Years

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

RakutenBank supports essential daily transactions

Customers can use RakutenBank’s account transfer (direct debit) for many institutions including utility charges

Q3/20 Number of payroll accounts: +51.8% YoY

Q3/20 Number of direct debit transactions: +47.1% YoY

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Rakuten Securities: Fastest Growing in Online Securities

Number of New Accounts Opening: No.1

Number of Accounts as of Sep/2020: 4.7mm

Investment with Rakuten Points:
Investment Trusts
Accumulation Type Investment Trusts
Domestic Stocks
Binary Option (Rakuopu),   etc.

RakutenSecurities Results

Revenue +31.8% YoY and Operating Income +40.6% YoY from growth in trading volumes of JapaneseStock and USStock

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Smartphone Transactions using iSPEED

US stock trades increased by 14x YoY in Sep. 2020, of which 53% are via iSPEED which began in Apr. 2020

Japanese stock trade also integrated into iSPEED. One-stop trading of Japanese and US stocks

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Approx. 5mm Locations Online and Offline

1mm Transit e-money locations

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

The Total Number of Rakuten Pay Users = 50 Million （As of Sep 2020）

New initiative: Rakuten Pay -Suica Linkage
(Railways is the mainstream of Japanese mobility - Annual rides per year with approx. 25 billion the 16-fold of taxi with approx. 1.5 billion)

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Rakuten Mobile grows to 1.6 mln subscribers, revenues up 48%
Thursday 12 November 2020 | 14:45 CET | News

Rakuten Mobile said it's grown to over 1.6 million customer applications as of November, up from 1 million in June. This follows the launch of its 5G network and new service plans in September. The company said it's accelerating the network roll-out with the aim of reaching 96 percent 4G population covering by summer 2021.

The operator's capital expenditure jumped to JPY 91.4 billion in the past quarter, from JPY 58.6 billion in the three months to June. It aims to reach 1,500 sites deployed per month in December from 750 in June, according to a presentation on its latest quarterly results.

The mobile business generated revenues of JPY 45.7 billion in the third quarter, up 48 percent from a year earlier. The operating loss widened over the same period to JPY 57.9 billion from JPY 14.5 billion.

www.telecompaper.com/news/...scribers-revenues-up-48--1361667

Rakuten also reported strong sales growth in its VoD business in Europe in the September quarter. Revenues from content services abroad increased 23 percent year-on-year.

Rakuten TV is now available to over 43 million households in Europe and has added 11 million users (paid and AVOD) since the start of calendar 2020, driven by demand for home entertainment during the Covid-19 crisis. The e-book platform Kobo added 5.4 million registered users over the same period, and the streaming service Rakuten Viki gained 8.9 million. The growth means all three businesses achieved positive adjusted operating profit in the third quarter of this year.

www.telecompaper.com/news/...scribers-revenues-up-48--1361667

Growing Overseas Content Businesses due to COVID-19 (Rakuten VIKI, Rakuten kobo, Rakuten TV)

Q3/20 Revenue: +23.1% YoY

Q3/20 vs Q4/19
Rakuten VIKI: Registered Users +8.9mm
Rakuten kobo: Registered Users +5.4mm
Rakuten TV: Total Users +11.0mm

Initiative for Expanding RakutenTV Users Expanded to 90mn households in 43 European Countries

global.rakuten.com/corp/investors/
20Q3videoPPT_E.pdf

Rakuten Mobile will accelerate customer acquisition while taking a balanced approach with regard to timing and the expansion of its mobile network service area

November 12, 2020

Japanese operator Rakuten Mobile, a unit of e-commerce giant Rakuten, expects its 4G network to cover 96% of the population in Japan by summer 2021, the company said in a statement.

The operator said that the base station development rate is expected to increase from 750 per month in June 2020 to 1,500 per month by December 2020.

The new entrant also noted that it has a total of 1.6 million applications for its mobile service as of November. “As the number of users increases, roaming costs also increase. Rakuten Mobile will accelerate customer acquisition while taking a balanced approach with regard to timing and the expansion of its mobile network service area,” the company said.

The operator reported an operating loss of JPY57.9 billion ($549.7 million) in the third quarter of the year, up compared to a loss of JPY14.55 billion in the same period of 2019. Revenue increased 48% to JPY45.7 billion.

telecomjobs.io/...-cover-96-of-japans-population-by-mid-2021/

KKR and Rakuten to invest in Japanese supermarket Seiyu

Exclusive: Companies to join Walmart as demand for deliveries grow

TOKYO - U.S. investment firm KKR and Japanese e-commerce company Rakuten are in discussions to invest in Seiyu, the Japanese supermarket chain owned by Walmart, Nikkei learned Sunday.

KKR, Rakuten and Walmart look to jointly operate Seiyu, multiple sources said.

KKR and Rakuten see an opportunity to grow Seiyu's business as demand for home deliveries expands amid COVID-19 restrictions.

Using Rakuten's e-commerce data, the companies hope to advance the digital transformation of Seiyu's brick-and-mortar stores.

Seiyu operates more than 300 stores in Japan and employs around 35,000 staffers. Its finances suffered after the bursting of Japan's bubble economy, and it accepted investment from Walmart in 2002. The American retail giant made Seiyu a wholly owned subsidiary in 2008.

Rakuten and Walmart announced an alliance on e-commerce in Japan in 2018.

Rakuten also teamed up with Seiyu to launch an online supermarket that year. It helps deliver from Seiyu stores and logistics centers to consumers' homes. Riding demand from shoppers staying home, the online supermarket saw its sales grow by 50% on the year in October.

The two have been accelerating cooperation, planning to open a large-scale automated warehouse exclusively for the online supermarket next year in Yokohama.

Rakuten has strength in analyzing customer data and hopes to help Seiyu adjust product selections at its stores and attract more customers. The e-commerce company has been investing in artificial intelligence and robotics technology to optimize operations.

asia.nikkei.com/Business/Business-deals/...-supermarket-Seiyu

The new ownership structure builds on previously established collaborations between Rakuten and Walmart, including the popular Rakuten Seiyu Netsuper online grocery delivery service and Rakuten Group’s partnership with Walmart that includes ebook service support in the United States. Rakuten will further accelerate digital transformation of Seiyu and other Japanese retailers through its new subsidiary Rakuten DX Solution, leveraging its 100M+ membership base and technology.

global.rakuten.com/corp/news/press/2020/...category=corp%20ec

Tokyo, November 16, 2020 – Rakuten, Inc. today announced plans to establish a new company to support brick-and-mortar retailers in Japan to implement digital transformation*1 with the introduction of multiple initiatives aimed at merging offline and online retail (OMO*2.) With the working name of Rakuten DX Solution, plans are on track for the company to be established in January 2021.

In addition, the company business plans include consideration of partnerships with companies that share the business vision for digital transformation for retail. Rakuten DX Solution’s potential partners include Tokyu Corporation.

global.rakuten.com/corp/news/press/2020/...category=corp%20ec