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LY Corporation
(4689)
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Rating:60Neutral
Price Target:
¥472.00
▲(10.31% Upside)
Action:Reiterated
Date:06/07/26
The score is primarily driven by solid growth/profitability and reasonable valuation, tempered by weak cash-flow consistency (including free cash flow dropping to zero in the latest period) and mixed-to-negative technical momentum signals.
Positive Factors
Business model diversification
A multi-product platform spanning advertising, commerce and payments creates durable revenue diversification and cross-selling. Network effects from large user engagement and merchant ecosystems support long-term monetization, reducing reliance on any single revenue stream.
Negative Factors
Free cash flow collapse
A drop of free cash flow to zero highlights inconsistency in cash conversion, likely from working capital swings or reinvestment spikes. Persistent FCF volatility impairs the firm's ability to self-fund growth, pay steady dividends, or reduce debt over time.
Read all positive and negative factors
Positive Factors
Negative Factors
Business model diversification
A multi-product platform spanning advertising, commerce and payments creates durable revenue diversification and cross-selling. Network effects from large user engagement and merchant ecosystems support long-term monetization, reducing reliance on any single revenue stream.
Read all positive factors
LY Corporation (4689) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥3.01T
Dividend Yield1.69%
Average Volume (3M)15.02M
Price to Earnings (P/E)15.9
Beta (1Y)0.20
Revenue Growth6.20%
EPS Growth33.70%
CountryJP
Employees29,863
SectorGeneral
Sector StrengthN/A
IndustrySoftware - Application
Share Statistics
EPS (TTM)28.07
Shares Outstanding6,884,613,000
10 Day Avg. Volume17,618,049
30 Day Avg. Volume15,020,503
Financial Highlights & Ratios
PEG Ratio0.41
Price to Book (P/B)0.88
Price to Sales (P/S)1.30
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥475.00Price Target Upside11.01% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)26.19
Revenue Forecast (FY)¥2.26T
LY Corporation Business Overview & Revenue Model
Company Description
LY Corporation engages in the online advertising and e-commerce businesses in Japan. The company offers LINE, a communication app; and Yahoo! JAPAN, an internet service that provides search, news, weather, shopping, auction, and other services. It...
How the Company Makes Money
LY Corporation generates revenue primarily through monetizing its digital platforms and user traffic. Key revenue streams include: (1) Advertising revenue: sale of digital advertising inventory (e.g., display and other online ad formats) and perfo...
LY Corporation Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q3-2025)
| % Change Since: |
Next Earnings Date:Aug 03, 2026
Earnings Call Sentiment Positive
The call conveyed solid underlying operational momentum once ASKUL is excluded: strong YoY growth in revenue and adjusted EBITDA in Commerce and Strategic segments, meaningful user and product traction (MINI Apps, Official Accounts), and a clear FY26 adjusted EBITDA target (10%–15% growth). Key weaknesses include the ASKUL ransomware outage that depressed consolidated results, Media segment ad/search weakness and near-term AI monetization still being developed. Management also outlined cost-reduction plans (JPY 15 billion) and multi-year infrastructure savings to support profit expansion.Positive Updates
Strong Underlying Revenue Growth Excluding ASKUL
Q3 consolidated revenue declined 0.7% YoY, but excluding ASKUL revenue increased 15.7% YoY, indicating solid underlying business expansion.
Negative Updates
ASKUL Ransomware Outage Impact
A subsidiary (ASKUL) experienced a system outage due to a ransomware attack; this materially impacted consolidated Q3 results and introduces uncertainty in near-term recovery and FY25 figures.
Read all updates
Q3-2025 Updates
Positive
Negative
Strong Underlying Revenue Growth Excluding ASKUL
Q3 consolidated revenue declined 0.7% YoY, but excluding ASKUL revenue increased 15.7% YoY, indicating solid underlying business expansion.
Read all positive updates
Company Guidance
The company reiterated FY25 guidance of roughly JPY 2.0 trillion in revenue and about JPY 500 billion in adjusted EBITDA (after the ASKUL system‑outage impact) and said adjusted EPS should remain within its initial range; for FY26 it is targeting a 10–15% increase in adjusted EBITDA (about JPY 550–575 billion). Management said Q3 underlying trends excluding ASKUL were strong (Q3 revenue +15.7% YoY, adjusted EBITDA +11.2% YoY), Commerce ex‑ASKUL revenue +31% YoY and adjusted EBITDA +15.5% YoY (LINE Yahoo! Commerce revenue +64.4% YoY), company‑wide ad revenue +3% and commerce advertising +20.1%, consolidated e‑commerce GMV/transaction value +2.5% YoY including ASKUL, Strategic revenue +30% YoY with margin expanding to 22.2%, PayPay consolidated revenue +24% and consolidated EBITDA +59.1% YoY to over JPY 30 billion in the quarter. Media is bottoming (Q3 ad revenue +0.4% total; search −9.5%, account +13.8%; adjusted EBITDA −2.8%), MINI Apps MAUs +63.8% and app count +57.8% YoY, AI‑related SG&A in Media ~JPY 1 billion+, AI search currently ~10%+ of search results, and the company expects segment profit uplifts of ~JPY 10 billion each for Media and Commerce (ex‑ASKUL), ~JPY 20 billion for Strategic (mainly PayPay) plus ~JPY 15 billion of company‑wide fixed‑cost savings (ASKUL recovery not assumed).LY Corporation Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
63
Positive
Cash Flow
52
Neutral
| Breakdown | Mar 2026 | Mar 2025 | Mar 2024 | Mar 2023 | Mar 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.04T | 1.92T | 1.81T | 1.67T | 1.57T |
| Gross Profit | 1.51T | 1.39T | 1.29T | 1.16T | 1.07T |
| EBITDA | 470.68B | 452.51B | 366.13B | 389.81B | 298.70B |
| Net Income | 193.69B | 153.47B | 113.20B | 178.87B | 77.32B |
Balance Sheet | |||||
| Total Assets | 11.21T | 9.52T | 9.41T | 8.66T | 7.17T |
| Cash, Cash Equivalents and Short-Term Investments | 1.07T | 1.19T | 1.62T | 1.81T | 1.43T |
| Total Debt | 1.96T | 1.69T | 1.88T | 1.91T | 1.67T |
| Total Liabilities | 7.49T | 6.10T | 5.97T | 5.34T | 4.19T |
| Stockholders Equity | 3.00T | 3.00T | 3.04T | 2.92T | 2.68T |
Cash Flow | |||||
| Free Cash Flow | 0.00 | 366.77B | 263.55B | 209.00M | 214.54B |
| Operating Cash Flow | 662.85B | 466.51B | 334.56B | 93.05B | 266.31B |
| Investing Cash Flow | -625.90B | -485.28B | -414.75B | 319.79B | -303.90B |
| Financing Cash Flow | -30.04B | -437.15B | -110.80B | 105.79B | 91.63B |
LY Corporation Technical Analysis
Positive
427.90
Price Trends
419.08
Positive
406.34
Positive
414.51
Positive
Market Momentum
9.39
Negative
66.18
Neutral
84.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4689, the sentiment is Positive. The current price of 427.9 is above the 20-day moving average (MA) of 426.25, above the 50-day MA of 419.08, and above the 200-day MA of 414.51, indicating a bullish trend. The MACD of 9.39 indicates Negative momentum. The RSI at 66.18 is Neutral, neither overbought nor oversold. The STOCH value of 84.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:4689.
LY Corporation Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | ¥715.00B | 37.87 | 32.41% | 3.62% | 20.01% | -6.20% | |
75 Outperform | ¥33.05B | 13.77 | ― | 0.38% | 16.53% | 76.82% | |
67 Neutral | ¥40.79B | 35.71 | ― | ― | 30.21% | 488.52% | |
66 Neutral | ¥26.56B | 8.29 | 22.37% | 5.66% | -8.47% | ― | |
60 Neutral | ¥3.01T | 15.93 | ― | 1.69% | 6.20% | 33.70% | |
60 Neutral | ¥8.46B | 42.49 | 4.78% | ― | -8.38% | -78.30% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
JP:4689
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LY Corporation Corporate Events
LY Corporation and Bain Capital lodge binding bid to take Kakaku.com private
Jul 1, 2026
LY Corporation and Bain Capital have escalated their previously non-binding approach to Kakaku.com into a legally binding proposal to take the price-comparison and online services operator private. The move follows due diligence and board approval...
LY Corporation to Absorb LINE Healthcare After Ending Telemedicine Service
Jul 1, 2026
LY Corporation will merge its wholly owned subsidiary LINE Healthcare Corporation through an absorption-type merger effective September 1, 2026, as part of a broader reorganization of overlapping businesses within the group. The move follows the J...
LY Corporation details SoftBank-led control structure and governance safeguards
Jun 30, 2026
LY Corporation disclosed the structure of its controlling shareholders, confirming that A Holdings Corporation directly holds 62.4% of voting rights and is classified as its largest and major shareholder, while SoftBank Group Corp., SoftBank Group...
LY’s PayPay to Take Control of T&D Financial Life in Push Into Digital Insurance
Jun 4, 2026
PayPay Corporation, the fintech arm of LY Corporation, will acquire 70.2% of TD Financial Life Insurance Company from TD Holdings, funding the all-cash deal from its own reserves. The move will make TD Financial Life a consolidated and specified s...
LY Corporation Corrects FY2025 Results, Upgrades PayPay GMV Figure
May 28, 2026
LY Corporation has revised its previously disclosed consolidated results for the fiscal year ended March 31, 2026, correcting an error in the reported gross merchandise value of its strategic subsidiary PayPay Corporation. The company emphasized t...
LY Corporation Cleared to Lift Stake in LINE MAN to Nearly 61%
May 27, 2026
LY Corporation said Thai authorities have confirmed that no regulatory approvals or permits are required for its planned additional acquisition of shares in LINE MAN CORPORATION PTE. LTD., which it already consolidated as a subsidiary in September...
LY Corporation Raises Year-End Dividend and Reaffirms Aggressive Payout Policy
May 15, 2026
LY Corporation’s board has approved a year-end dividend of JPY7.30 per share for the fiscal year ended March 31, 2026, matching its prior forecast and slightly above the previous year’s JPY7.00. The total dividend payment will be about...
LY Corporation Expands Stock-Based Pay Plan to Wider Group of Directors
May 15, 2026
LY Corporation plans to partially revise its existing trust-based restricted stock unit remuneration plan so that all directors, excluding those on the Audit and Supervisory Committee, become eligible rather than only executive directors. The move...
LY Corporation and Bain Capital Propose Take-Private Deal for Kakaku.com
May 14, 2026
LY Corporation, together with an investment fund advised by Bain Capital Private Equity, has submitted joint proposals to Kakaku.com, Inc. regarding a potential capital policy overhaul, including taking Kakaku.com private. The move reflects LY Cor...
LY Corporation Delivers Strong FY2025 Earnings and Lifts Dividend as It Expands Consolidation Scope
May 8, 2026
LY Corporation reported consolidated revenue of ¥2.04 trillion for the fiscal year ended March 31, 2026, up 6.2% year-on-year, with operating income rising 8.3% to ¥341.3 billion and net income attributable to owners of the parent increa...
LY Corporation Posts Record Revenue and Profit Surge on PayPay and Commerce Growth
May 8, 2026
LY Corporation reported record consolidated revenue of ¥2.04 trillion for the fiscal year ended March 31, 2026, up 6.2% from the previous year, driven mainly by PayPay’s consolidation and the addition of BEENOS and LINE MAN in its comme...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.