LY Corporation (JP:4689)
:4689
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LY Corporation
(4689)
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Rating:68Neutral
Price Target:
¥480.00
▲(12.18% Upside)
Action:Reiterated
Date:05/09/26
The score is driven primarily by mixed financial performance—solid growth/profitability but notably weak and volatile free cash flow (including a drop to zero in 2026). Technicals are supportive with a clear uptrend and positive momentum. Guidance is constructive with targeted EBITDA growth and cost savings, while valuation appears reasonable with a modest dividend yield.
Positive Factors
Diversified revenue model
LY's revenue mix across advertising, commerce/marketplace fees, payments/fintech transaction income and subscriptions creates durable revenue diversification. This reduces single-market dependence, enables cross-product monetization and recurring streams that support resilient top-line and margin stability over multiple years.
Negative Factors
Volatile free cash flow
Repeated swings in free cash flow, and a collapse to zero in 2026, weaken financial flexibility. Inconsistent FCF complicates reinvestment, dividend policy and deleveraging plans and raises the risk that reported profits may not reliably convert into cash, constraining durable capital allocation choices.
Read all positive and negative factors
Positive Factors
Negative Factors
Diversified revenue model
LY's revenue mix across advertising, commerce/marketplace fees, payments/fintech transaction income and subscriptions creates durable revenue diversification. This reduces single-market dependence, enables cross-product monetization and recurring streams that support resilient top-line and margin stability over multiple years.
Read all positive factors
LY Corporation (4689) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥2.75T
Dividend Yield1.69%
Average Volume (3M)15.02M
Price to Earnings (P/E)13.7
Beta (1Y)0.16
Revenue Growth6.20%
EPS Growth34.04%
CountryJP
Employees28,196
SectorConsumer Cyclical
Sector Strength84
IndustryInternet Content & Information
Share Statistics
EPS (TTM)28.07
Shares Outstanding6,884,305,000
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
¥448.33Price Target Upside4.78% Upside
Rating ConsensusHold
Number of Analyst Covering3
EPS Forecast (FY)27.18
Revenue Forecast (FY)¥2.24T
LY Corporation Business Overview & Revenue Model
Company Description
LY Corp. engages in the management of group companies and related operations. It operates through the following segments: Media and Commerce. The Media segment covers the advertisement related services that include search linked advertisement and ...
How the Company Makes Money
LY Corporation generates revenue primarily through (1) advertising: selling digital ad inventory and performance-based marketing solutions across its owned and operated services, including display and other online ad formats, and providing related...
LY Corporation Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q3-2025)
| % Change Since: |
Next Earnings Date:Jul 30, 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 | 285.37B | 452.51B | 362.00B | 302.42B | 303.56B |
| 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
404.49
Positive
399.60
Positive
428.39
Negative
Market Momentum
2.94
Positive
52.94
Neutral
27.49
Neutral
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 422.23, above the 50-day MA of 404.49, and below the 200-day MA of 428.39, indicating a neutral trend. The MACD of 2.94 indicates Positive momentum. The RSI at 52.94 is Neutral, neither overbought nor oversold. The STOCH value of 27.49 is Neutral, 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 (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | ¥673.16B | 23.13 | 32.41% | 3.62% | 20.01% | -6.20% | |
75 Outperform | ¥30.63B | 21.60 | ― | 0.38% | 19.28% | 113.67% | |
70 Outperform | ¥43.74B | 34.67 | ― | ― | 27.05% | 495.56% | |
68 Neutral | ¥2.75T | 13.68 | ― | 1.69% | 6.20% | 34.04% | |
66 Neutral | ¥24.31B | 7.74 | 22.37% | 5.66% | -8.47% | ― | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | ¥9.11B | -5.91 | 4.78% | ― | -8.38% | -78.30% |
* Consumer Cyclical Sector Average
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LY Corporation Corporate Events
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...
LY Corporation Reshapes Board as Chairperson Kawabe to Retire
Apr 6, 2026
LY Corporation announced board changes following an April 6 meeting, with long-serving Chairperson and Representative Director Kentaro Kawabe set to retire when his term ends at the June 19 shareholders’ meeting. President and CEO Takeshi Id...
LY Subsidiary PayPay Raises ¥94.6 Billion in Nasdaq IPO, Retains Consolidated Status
Mar 30, 2026
PayPay Corporation, a consolidated subsidiary of LY Corporation, has completed its initial public offering on the Nasdaq Global Select Market, issuing a total of 63,235,295 American depositary shares at US$16 each. The deal included the full exerc...
LY Corp Subsidiary PayPay Prices US$16 Nasdaq IPO, Adds Japan Tranche
Mar 12, 2026
PayPay Corporation, the digital payments subsidiary of LY Corporation, has priced its U.S. initial public offering at US$16 per American depositary share, with 54,987,214 ADSs to be sold on the Nasdaq under the ticker “PAYP.” Of the to...
LY’s PayPay Launches Nasdaq IPO Roadshow With Dual Japan Offering
Mar 3, 2026
LY Corporation’s subsidiary PayPay Corporation, a cashless payment provider, has launched a roadshow for an initial public offering of American depositary shares on the Nasdaq Global Select Market under the ticker symbol PAYP, with an indica...
LY Subsidiary PayPay Files for U.S. IPO and Parallel Japan Offering
Feb 13, 2026
PayPay Corporation, a consolidated subsidiary of LY Corporation, has filed a registration statement on Form F-1 with the U.S. Securities and Exchange Commission for a proposed initial public offering of American depositary shares on the Nasdaq Glo...
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.