At Ando Money, we dive deep into company finances, including Rakuten net worth. In 2024, Rakuten continues to be a prominent name in e-commerce, FinTech, and mobile services.
Curious about how the company’s financial situation stacks up this year? Let’s explore their revenue drivers and factors shaping their financial performance.
Quick Facts
| FACT | DETAIL |
|---|---|
| Name | Rakuten Group, Inc. |
| Full Name | Rakuten Group, Inc. |
| Website | global.rakuten.com |
| Industry | E-commerce, FinTech, Telecommunications |
| Traded as | Tokyo Stock Exchange (Code: 4755) |
| ISIN | N/A |
| Founded | 7 February 1998 |
| Founders | Hiroshi Mikitani |
| Country/Territory | Japan |
| Headquarters | Japan |
| Chief Executive Officer | Hiroshi Mikitani |
| Number of Employees | N/A |
| Market Cap | $13.66 billion (as of October 2024) |
| Total Assets | ¥24,828,283 million ($166.18 billion) |
| Total Equity | ¥1,128,050 million ($7.55 billion) |
| Revenue | ¥1,050,908 million ($7.04 billion) |
| Net Income | Loss of ¥75,962 million (loss of $509 million) |
What is the Net Worth/Market Cap Of Rakuten in 2024?
As of October 2024, Rakuten’s market cap stands at $13.66 billion. This makes Rakuten one of the significant players in the e-commerce and FinTech sectors.
In comparison to other tech giants, Rakuten’s market value reflects both its diverse business model and recent financial challenges. Although lower than some industry giants, Rakuten holds a steady position within its sector.
Some close competitors and related companies include:
For those curious about the largest and wealthiest companies, check out this list of the richest companies to see how Rakuten stacks up.
Rakuten Financial Performance Overview
Revenue Sources
Rakuten’s revenue sources are driven by three primary segments: Internet Services, FinTech, and Mobile.
In the first half of 2024, Rakuten generated ¥1,050,908 million in revenue, an increase of 8% compared to 2023. This is largely attributed to the company’s diversified operations across these sectors.
In Internet Services, which includes e-commerce platforms like Rakuten Ichiba, the company reported revenue growth of 4.2% year-over-year.
The success here comes from the focus on increasing cross-usage and acquiring new customers through services like Rakuten Travel.
In FinTech, revenue soared by 13.5% year-over-year, driven by strong growth in Rakuten’s credit card and banking businesses.
This segment contributed significantly to Rakuten’s financial performance, with the cumulative issuance of Rakuten Cards exceeding 31 million as of June 2024.
Rakuten’s Mobile division is still experiencing losses but showed revenue growth of 10.4% year-over-year, reflecting its focus on improving network infrastructure and expanding customer acquisition.
Factors Affecting Rakuten’s Financial Performance
Rakuten’s financial performance is influenced by several key drivers. Firstly, the Internet Services segment benefits from Rakuten’s ability to integrate digital content, travel bookings, and e-commerce.
Despite the competitive market, Rakuten continues to optimize marketing measures to enhance profitability.
The FinTech segment has been a standout, with Rakuten Bank and Rakuten Securities attracting more users.
As of May 2024, Rakuten Securities saw its entrusted assets exceed ¥30 trillion, demonstrating the company’s growing footprint in financial services.
On the mobile front, Rakuten’s efforts to expand its network, including the launch of services in the 700MHz band (also known as the “Platinum Band”), are aimed at boosting subscriber growth.
Financial Breakdown by Business Segments
Rakuten’s financial breakdown reveals the strength of its diversified business model.
In the Internet Services segment, the company posted ¥589,599 million in revenue, driven by consistent performance in Rakuten Ichiba and growth in Rakuten Rewards.
The FinTech segment is Rakuten’s highest performer in 2024, with ¥396,154 million in revenue.
This segment includes credit card services, online banking, and securities, all contributing to the segment’s 36.7% increase in profit.
The introduction of new services, such as the “Money Bridge” that links Rakuten Bank with Rakuten Securities, has enhanced customer retention and usage.
Rakuten’s Mobile segment is still recovering from substantial losses but reported ¥194,801 million in revenue for the first half of 2024.
The company’s efforts to optimize network costs and improve marketing efficiency have begun to pay off, though achieving profitability remains a challenge.
Cost Structure and Profitability
Rakuten’s cost structure has been significantly impacted by investments in its Mobile network infrastructure.
The company has invested heavily in building a robust network, which explains why the Mobile segment continues to report losses despite revenue growth.
In terms of overall profitability, Rakuten reported an operating loss of ¥51,603 million in the first half of 2024.
However, the company’s EBITDA stood at ¥119,557 million, reflecting strong cash flow generation despite non-GAAP losses.
Marketing expenses across the segments have been optimized, contributing to better profit margins in FinTech and Internet Services.
Nevertheless, the Mobile segment’s losses continue to weigh on Rakuten’s overall profitability.
Financial Challenges and Opportunities
Rakuten faces financial challenges in its Mobile division, where losses have decreased but remain a concern.
The company is working to reduce these losses by focusing on subscriber growth and network optimization.
Opportunities for growth lie in Rakuten’s FinTech and Internet Services segments, both of which have shown strong revenue and profit growth.
The FinTech segment, in particular, is poised for further expansion, with the “Money Bridge” service playing a pivotal role in attracting more users to Rakuten Bank and Rakuten Securities.
Foreign currency fluctuations, especially the depreciation of the yen, have also impacted Rakuten’s revenue.
However, the company’s diverse portfolio and focus on innovation through AI and digital technologies should support future growth.
Future Outlook for Rakuten’s Revenue Growth
Looking ahead, Rakuten is targeting double-digit revenue growth in 2024. Key areas of focus include expanding FinTech services, leveraging its AI capabilities, and exploring new markets for its Mobile services.
The launch of the 700MHz band is expected to improve the quality of Rakuten’s mobile network, which could lead to an increase in subscribers and profitability in the coming years.
FAQs about Rakuten
How has Rakuten’s FinTech segment performed in 2024?
Its FinTech segment grew by 13.5% in 2024, with revenue reaching ¥396,154 million. The success of services like Rakuten Card and Rakuten Bank contributed significantly to this growth.
What is Rakuten’s strategy in the mobile sector?
Rakuten is focused on improving network infrastructure and expanding customer acquisition. In 2024, the company launched services in the 700MHz band, improving its mobile network quality.
How much revenue did Rakuten generate from its Internet Services?
Its Internet Services segment generated ¥589,599 million in revenue during the first half of 2024, growing by 4.2% year-over-year. Key contributors include Rakuten Ichiba and Rakuten Rewards.
What are the key challenges for Rakuten in 2024?
Rakuten’s key challenges include reducing losses in the Mobile segment and managing the impact of foreign currency fluctuations on its revenue. However, the company is making strides in both areas.
Conclusion
Rakuten’s diverse business model continues to show potential, despite some financial challenges.
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