Rakuten Inc (JP:4755)
:4755
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Rakuten
(4755)
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Rating:41Neutral
Price Target:
¥713.00
▼(-2.03% Downside)
Action:ReiteratedDate:02/18/26
The score is driven primarily by weak financial quality—ongoing net losses and high leverage—despite strong revenue growth and improved operating cash flow. Technicals are also unfavorable with the stock trading below major moving averages and bearish MACD, while valuation is constrained by a negative P/E and no dividend yield data.
Positive Factors
Integrated ecosystem and loyalty program
Rakuten's integrated ecosystem and Rakuten Points loyalty program create durable cross‑sell advantages across commerce, fintech, and mobile. Shared IDs and points increase customer lifetime value and stickiness, supporting sustained monetization and targeted advertising revenue.
Negative Factors
High leverage and limited financial flexibility
A debt-to-equity ratio of roughly 5–6x indicates heavy reliance on debt financing, constraining flexibility. High leverage raises refinancing, interest rate and covenant risks, limiting ability to invest or absorb shocks and making long‑term strategy sensitive to credit conditions.
Read all positive and negative factors
Positive Factors
Negative Factors
Integrated ecosystem and loyalty program
Rakuten's integrated ecosystem and Rakuten Points loyalty program create durable cross‑sell advantages across commerce, fintech, and mobile. Shared IDs and points increase customer lifetime value and stickiness, supporting sustained monetization and targeted advertising revenue.
Read all positive factors
Rakuten (4755) vs. iShares MSCI Japan ETF (EWJ)
Market Cap
¥1.60T
Dividend YieldN/A
Average Volume (3M)12.39M
Price to Earnings (P/E)―
Beta (1Y)1.00
Revenue Growth11.45%
EPS Growth42.34%
CountryJP
Employees29,334
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)-12.23
Shares Outstanding2,172,124,300
10 Day Avg. Volume10,950,400
30 Day Avg. Volume12,385,006
Financial Highlights & Ratios
PEG Ratio-1.39
Price to Book (P/B)2.19
Price to Sales (P/S)0.87
P/FCF Ratio7.82
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
¥1,061.69Price Target Upside45.88% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
EPS Forecast (FY)-7.9
Revenue Forecast (FY)¥2.61T
Rakuten Business Overview & Revenue Model
Company Description
Rakuten Group, Inc. offers internet services in Japan and internationally. It operates through three segments: Internet Services, FinTech, and Mobile segments. The Internet Services segment operates Rakuten Ichiba, an internet shopping mall; Rakut...
How the Company Makes Money
Rakuten generates revenue across three primary areas—Internet Services, FinTech, and Mobile/communications—using an ecosystem strategy that links user acquisition, engagement, and monetization through shared IDs and Rakuten Points.
1) Internet Se...
Rakuten Earnings Call Summary
Earnings Call Date:Aug 08, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:May 20, 2026
Earnings Call Sentiment Neutral
The earnings call reflects strong growth in revenue and EBITDA, driven by improvements across several segments, particularly in Mobile and FinTech. The launch of Rakuten AI and advancements in AI initiatives showcase the company's innovation. However, challenges remain with valuation losses in the Internet Services segment, financial issues related to taxation, and a reported net loss, balancing the positive aspects with notable concerns.Positive Updates
Record Growth in Revenue and EBITDA
Consolidated revenue increased by 11% YoY to JPY596.4 billion, and consolidated EBITDA increased significantly by 54.5% YoY, reaching JPY103.2 billion, marking the highest amount ever recorded for a Q2.
Negative Updates
Valuation Losses in Internet Services Segment
Non-GAAP operating income in the Internet Services segment declined by 10.5% YoY due to valuation losses on securities held in the minority investment business.
Read all updates
Q2-2025 Updates
Positive
Negative
Record Growth in Revenue and EBITDA
Consolidated revenue increased by 11% YoY to JPY596.4 billion, and consolidated EBITDA increased significantly by 54.5% YoY, reaching JPY103.2 billion, marking the highest amount ever recorded for a Q2.
Read all positive updates
Company Guidance
In the Q2 2025 call, Rakuten Group reported significant financial and operational progress across various segments. Rakuten Mobile achieved a stand-alone EBITDA of JPY5.6 billion, improving by JPY19.1 billion YoY, with a subscriber base reaching 9.08 million. The Group's consolidated revenue grew by 11% YoY to JPY596.4 billion, with notable contributions from the Internet Services, FinTech, and Mobile segments, which saw revenue increases of 6.8%, 14.8%, and 18.1%, respectively. Consolidated non-GAAP operating income rose by JPY31.9 billion YoY to JPY20.1 billion, marking the first Q2 profit since FY2019. Additionally, Rakuten launched its Rakuten AI and Agentic AI platform, enhancing user experience with personalized search and AI-driven advertising optimizations. The FinTech segment saw a 10.2% YoY increase in Rakuten Card shopping GTV to JPY6.5 trillion, while Rakuten Bank's accounts surpassed 17 million, reflecting robust growth in the customer base. The Mobile segment's revenue surged by 33.5% YoY to JPY90.6 billion, with improvements in network quality and innovative packages like the Rakuten Saikyo U-Next package. The call also highlighted Rakuten's issuance of sustainability bonds as part of its financial strategy to ensure medium-term stability and growth.Rakuten Financial Statement Overview
Summary
Income Statement
34
Negative
Balance Sheet
28
Negative
Cash Flow
52
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 2.50T | 2.28T | 2.07T | 1.92T | 1.68T |
| Gross Profit | 97.41B | 948.08B | 790.31B | 585.31B | 542.63B |
| EBITDA | 417.88B | 306.69B | 150.77B | -58.35B | -87.31B |
| Net Income | -177.89B | -162.44B | -339.47B | -377.22B | -133.83B |
Balance Sheet | |||||
| Total Assets | 28.80T | 26.51T | 22.63T | 20.40T | 16.83T |
| Cash, Cash Equivalents and Short-Term Investments | 5.84T | 6.33T | 5.24T | 4.79T | 4.48T |
| Total Debt | 5.57T | 5.51T | 4.86T | 4.89T | 3.75T |
| Total Liabilities | 27.45T | 25.28T | 21.54T | 19.55T | 15.71T |
| Stockholders Equity | 992.40B | 927.87B | 836.57B | 791.35B | 1.09T |
Cash Flow | |||||
| Free Cash Flow | 277.83B | 1.04T | 493.47B | -584.07B | 295.85B |
| Operating Cash Flow | 343.50B | 1.13T | 687.30B | -285.40B | 582.71B |
| Investing Cash Flow | -779.81B | -920.42B | -584.09B | -944.93B | -611.83B |
| Financing Cash Flow | 94.72B | 819.49B | 315.52B | 1.51T | 1.40T |
Rakuten Technical Analysis
Negative
727.80
Price Trends
872.94
Negative
924.69
Negative
897.66
Negative
Market Momentum
-35.80
Positive
24.65
Positive
5.75
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:4755, the sentiment is Negative. The current price of 727.8 is below the 20-day moving average (MA) of 786.51, below the 50-day MA of 872.94, and below the 200-day MA of 897.66, indicating a bearish trend. The MACD of -35.80 indicates Positive momentum. The RSI at 24.65 is Positive, neither overbought nor oversold. The STOCH value of 5.75 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for JP:4755.
Rakuten Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | ¥1.52T | 11.88 | 9.29% | 1.11% | ― | ― | |
66 Neutral | ¥295.29B | 14.98 | 11.17% | 2.61% | 5.63% | 25.64% | |
65 Neutral | $974.69B | 17.87 | 49.14% | 2.82% | 6.80% | 0.62% | |
64 Neutral | ¥449.62B | 9.24 | 4.18% | 2.57% | 1.26% | 14.65% | |
63 Neutral | ¥583.67B | 23.34 | 31.11% | ― | 4.83% | 106.29% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
41 Neutral | ¥1.60T | -12.21 | -21.14% | ― | 11.45% | 42.34% |
* Consumer Cyclical Sector Average
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Rakuten Corporate Events
Rakuten’s Operating Profit Surges in FY2025 but One-Off Losses Drive Net Result into Red
Feb 25, 2026
Rakuten Group reported a sharp rise in non-consolidated operating income for fiscal 2025, with profit from core operations jumping more than fourfold to ¥70.0 billion on the back of steady domestic e-commerce growth and stable selling, genera...
Rakuten Overhauls Board as CFO Steps Down and New Directors Join
Feb 25, 2026
Rakuten Group announced a board reshuffle effective March 27, 2026, centered on the resignation of Director and Group CFO Kenji Hirose, who will retire from his executive roles and become an Executive Fellow. The company plans to appoint Group Exe...
Rakuten Revives FinTech Reorganization Talks With Rakuten Bank Amid Intensifying Competition
Feb 25, 2026
Rakuten Group and its listed subsidiary Rakuten Bank have agreed to restart talks on reorganizing Rakuten’s FinTech business and have signed a new memorandum of understanding after previously launching and then discontinuing similar discussi...
Rakuten Grants Long-Term Retirement Stock Options to Executive Officers
Feb 12, 2026
Rakuten Group has approved the issuance of 5,981 units of share acquisition rights, representing up to 598,100 shares of common stock, as retirement compensation stock options for 49 executive officers. The zero-cost options are structured so that...
Rakuten Grants New Stock Options to Align Staff Incentives With Shareholders
Feb 12, 2026
Rakuten Group has approved the issuance of 9,151 share acquisition rights as stock options to directors of its subsidiaries and to 67 executive officers and employees across the group, covering up to 915,100 shares of common stock. The options, wh...
Rakuten Halts 2025 Dividend, Extends Rakuten Mobile Perks to Shareholders
Feb 12, 2026
Rakuten Group’s board has decided not to pay a year-end dividend for the fiscal year with a record date of December 31, 2025, as it prioritizes financial soundness and the reduction of interest-bearing debt. The company says limiting cash ou...
Rakuten Lifts Revenue and EBITDA but Deeper Net Loss Highlights Balance-Sheet Strain
Feb 12, 2026
Rakuten Group reported a 9.5% rise in revenue to ¥2.50 trillion for fiscal 2025, but operating income dropped 72.9% to ¥14.4 billion and the company swung to an income-before-tax loss of ¥29.6 billion, with net income attributable t...
Rakuten lifts revenue and core profits in 2025 but net loss deepens
Feb 12, 2026
Rakuten reported consolidated revenue of ¥2.50 trillion for fiscal 2025, up 9.5% year-on-year, with all major segments – Internet Services, FinTech and Mobile – posting higher sales and stronger underlying profitability. Despite t...
Rakuten Flags Asset Impairments but Books Derivative Gains for FY2025
Feb 10, 2026
Rakuten Group, Inc. said it expects to book significant impairment losses on fixed assets tied to its Rakuten Symphony Open RAN and logistics businesses in its consolidated results for the year ended December 31, 2025. The company cited slower-tha...
Rakuten Securities Posts Strong Profit Growth in Fiscal 2025
Jan 27, 2026
Rakuten Securities, Inc. reported strong growth for the fiscal year ended December 31, 2025, with operating revenue rising to ¥158.3 billion and net income increasing to ¥21.7 billion, up from ¥130.1 billion and ¥16.1 billion, ...
Rakuten Issues New Stock Options to Align Employee Incentives and Bolster Talent Retention
Jan 15, 2026
Rakuten Group has approved the issuance of 50,314 share acquisition rights (stock options), covering up to 5,031,400 common shares, to directors of subsidiaries and to about 15,600 executive officers and employees across the group. The options, gr...
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.