The following is a summary of the LY Corporation (YAHOF) Q3 2023 Earnings Call Transcript:

Financial Performance:

• LY Corporation reported an adjusted EBITDA for Q3 of JPY109.8 billion, a 17.4% increase YoY and revised its full-year guidance upward.

• Revenue reached a record high for Q3 of JPY475 billion with total advertising revenue growing by 3.7% YoY.

• Adjusted earnings per share (EPS) are recovering at a faster-than-expected pace, with a revision for Q4 to JPY18.7, mainly driven by tax effects.

• Significant increase in adjusted net income was observed due to the increase in operating income and improvement in equity in earnings of affiliates.

• Revenue and income from commerce business grew by 2.7% YoY.

• Adjusted EBITDA in the commerce segment grew by 6.1% YoY.

• Full-year profitability is expected with observed growth from cost optimization initiatives.

• Full-year guidance for fiscal 2023 was revised upward, with adjusted EBITDA expected to reach JPY390 billion.

Business Progress:

• LY Corporation plans to implement strategic initiatives to plan for the direction of the upcoming fiscal year.

• They aim to exceed e-commerce market growth in the next fiscal year despite a deceleration in the current fiscal year.

• LYP premium continues to grow steadily, reaching 23.22 million at the end of January.

• Plans to improve the efficiency and effectiveness of ad operations are underway.

• The strategic business recorded a 17.5% YoY revenue growth mainly due to growth in PayPay and PayPay card.

• Stunning growth has been observed in PayPay bank and Baby card with transaction volume growing by 28.1% YoY.

• The company plans to increase membership numbers by several million members, with adjustments being made to enhance shopping experiences for users.

• Collaborations between LINE and PayPay are underway to increase user base and utilize PayPay points across multiple engagement platforms.

• Distinguished growth has been reported in the strategic segment, largely propelled by the acquisition of cardholders for the PayPay card and the promotion of the PayPay app.

• LY Corporation reported a positive traction in digital advertising, significantly improving the revenue from display ads and receiving favorable feedback for product development initiatives.

More details: LY CORPORATION IR

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