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GMO Internet Inc (JP:9449)
:9449

GMO Internet (9449) AI Stock Analysis

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JP:9449

GMO Internet

(9449)

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Neutral 66 (OpenAI - 4o)
Rating:66Neutral
Price Target:
¥4,339.00
▲(13.05% Upside)
GMO Internet's stock score is driven by strong financial performance and bullish technical indicators. However, increased leverage and potential overvaluation are concerns. The absence of earnings call data and corporate events limits additional insights.
Positive Factors
Revenue Growth
Consistent revenue growth indicates a strong market position and effective business strategies, supporting long-term expansion and profitability.
Cash Generation
Strong cash generation enhances financial flexibility, enabling investments in growth opportunities and reducing reliance on external financing.
Operational Efficiency
High margins reflect effective cost management and operational efficiency, contributing to sustained profitability and competitive advantage.
Negative Factors
Rising Leverage
Increased leverage can heighten financial risk, potentially limiting the company's ability to invest in growth and affecting financial stability.
Net Profit Margin Decline
A declining net profit margin suggests rising expenses or cost pressures, which could impact future profitability and financial health.
Equity Ratio Decline
A lower equity ratio indicates increased liabilities relative to equity, which could pose risks to financial stability and limit growth potential.

GMO Internet (9449) vs. iShares MSCI Japan ETF (EWJ)

GMO Internet Business Overview & Revenue Model

Company DescriptionGMO Internet, Inc. provides various Internet services worldwide. It operates through Internet Infrastructure, Online Advertising and Media, Internet Finance, and Cryptocurrency segments. It offers Internet infrastructure services in the areas of domain, hosting, cloud, security, payments, e-commerce support, connection, Website creation support, marketing support, community, contents, app, and IoT. The company also provides online advertising and media services, such as media services, search, ad tech services, mobile marketing, O2O, and coupon/point services; and Internet financial services, including Internet securities, and FX and other trading services. In addition, it engages in cryptocurrency trading and mining business; and mobile, online, and other games. The company was incorporated in 1976 and is headquartered in Tokyo, Japan.
How the Company Makes MoneyGMO Internet generates revenue through multiple streams, primarily from its domain registration and web hosting services, which attract thousands of new customers annually. The company also earns significant income from its cloud services and e-commerce solutions, which cater to businesses looking to enhance their online operations. Additionally, revenue is derived from its online advertising services and financial technology offerings, including cryptocurrency exchanges. Strategic partnerships with other tech firms and collaborations in the digital finance space also contribute to its earnings, while the company's focus on innovation and expansion into new markets supports its overall financial growth.

GMO Internet Earnings Call Summary

Earnings Call Date:Aug 08, 2024
(Q2-2024)
|
% Change Since: |
Next Earnings Date:Feb 18, 2026
Earnings Call Sentiment Neutral
The earnings call highlighted strong performance in the Infrastructure and Crypto Assets segments, and an increase in shareholder returns, but faced significant challenges in the Finance segment, especially due to the provision in the Thai Securities business, and declines in the Advertising and Media segment.
Q2-2024 Updates
Positive Updates
Infrastructure Segment Performance
Net sales in the Infrastructure segment achieved a quarterly high with recurring revenues and operating profit exceeding JPY 9 billion for the third consecutive quarter.
Crypto Assets Turnaround
The crypto assets segment recorded profit for the third consecutive quarter due to increased trading volume and revenue from GMO Coin's exchange business.
Shareholder Returns Increase
The company announced an increase in the maximum amount of share buybacks to JPY 5 billion, exceeding the 50% total return ratio.
Expansion of Security Business
Progress in the security business with emphasis on encryption security, cybersecurity, and brand security, leading to the #1 position in Japan for GMO Sign's e-contract accounts.
Negative Updates
Decrease in Profit
Despite increased revenue, overall profits decreased due to a provision for doubtful accounts by a Thailand-based securities company.
Challenges in Finance Segment
The Finance segment faced a decrease in sales and losses, particularly due to a JPY 4.5 billion provision for doubtful accounts in the Thai Securities business.
Advertising and Media Revenue Decline
The Advertising and Media segment saw a decrease in revenue attributed to weak performance in the advertising agency business, although profit increased due to in-house services.
FX Revenue Decline
The FX product faced a decline in revenue due to decreased volatility and a rapid depreciation of the yen, leading to lower profits.
Company Guidance
During the Q2 2024 earnings call for GMO Internet Group, executives Masashi Yasuda and Noriko Inagaki provided detailed guidance, highlighting several metrics. The Infrastructure segment reached a quarterly high in net sales with operating profit exceeding JPY 9 billion for the third consecutive quarter, driven by solid recurring revenues. In contrast, the Finance segment recorded losses due to a JPY 4.5 billion provision for doubtful accounts in the Thai Securities business, prompting the termination of margin trading services there. The crypto assets segment showed profitability for the third consecutive quarter, buoyed by increased trading volume and exchange business revenue. The company is maintaining a total shareholder return ratio of 50%, with a Q2 dividend of JPY 6.9 per share, and announced an increase in the share repurchase limit to JPY 5 billion. Additionally, GMO Internet outlined its 55-year plan aiming for JPY 10 trillion in sales and JPY 1 trillion in profit by 2051, with a focus on embracing AI and robotics as key growth drivers.

GMO Internet Financial Statement Overview

Summary
GMO Internet shows solid revenue growth and operational efficiency, but increased leverage and concerns about long-term cash flow sustainability present financial risks.
Income Statement
72
Positive
GMO Internet has shown consistent revenue growth, with a 7.25% increase from 2023 to 2024. The gross profit margin for 2024 is strong at 59.89%, and the EBIT margin stands at 16.81%, indicating effective cost management. However, the net profit margin decreased to 4.82% in 2024 from 5.49% in 2023, suggesting rising expenses or other cost pressures.
Balance Sheet
65
Positive
The company's debt-to-equity ratio increased from 5.73 in 2023 to 6.42 in 2024, indicating higher leverage. However, the return on equity remains strong at 15.48% for 2024, demonstrating effective use of equity to generate profits. The equity ratio decreased slightly to 4.02%, highlighting potential risks in financial stability due to rising liabilities.
Cash Flow
58
Neutral
GMO Internet's free cash flow improved significantly from -7,527,000,000 in 2023 to 58,624,000,000 in 2024, indicating strong cash generation capabilities. The operating cash flow to net income ratio is robust at 6.34, suggesting efficient cash conversion. However, the free cash flow to net income ratio of 4.39 shows that net income growth is not matching free cash flow growth, which could be a concern for future sustainability.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue283.48B277.41B258.64B245.70B241.45B210.56B
Gross Profit169.17B166.14B153.13B149.89B128.82B105.68B
EBITDA68.81B62.83B55.74B72.25B50.61B38.97B
Net Income16.37B13.37B14.19B13.21B17.53B10.28B
Balance Sheet
Total Assets2.10T2.15T1.76T1.54T1.42T1.07T
Cash, Cash Equivalents and Short-Term Investments865.53B975.72B905.44B353.69B248.59B281.24B
Total Debt539.78B554.87B473.57B391.16B294.66B208.38B
Total Liabilities1.90T1.96T1.58T1.39T1.28T970.43B
Stockholders Equity86.54B86.40B82.60B72.22B73.60B50.97B
Cash Flow
Free Cash Flow0.0058.62B-7.53B15.24B-32.28B30.79B
Operating Cash Flow0.0084.73B14.91B25.64B-23.78B38.28B
Investing Cash Flow0.00-71.50B-16.36B-2.83B-51.77B-15.99B
Financing Cash Flow0.0060.78B64.97B62.44B89.89B37.52B

GMO Internet Technical Analysis

Technical Analysis Sentiment
Positive
Last Price3838.00
Price Trends
50DMA
3610.66
Positive
100DMA
3705.41
Positive
200DMA
3517.93
Positive
Market Momentum
MACD
69.48
Positive
RSI
54.39
Neutral
STOCH
34.46
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JP:9449, the sentiment is Positive. The current price of 3838 is above the 20-day moving average (MA) of 3832.65, above the 50-day MA of 3610.66, and above the 200-day MA of 3517.93, indicating a bullish trend. The MACD of 69.48 indicates Positive momentum. The RSI at 54.39 is Neutral, neither overbought nor oversold. The STOCH value of 34.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JP:9449.

GMO Internet Peers Comparison

Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
¥265.36B20.6813.42%2.27%5.10%12.48%
74
Outperform
¥23.36B22.0530.15%31.28%
71
Outperform
¥500.13B21.8415.67%1.33%12.48%18.38%
70
Outperform
¥3.07B11.090.99%11.10%16.84%
66
Neutral
¥12.17B28.861.01%17.19%-43.91%
66
Neutral
¥395.80B23.3017.97%1.42%4.75%17.02%
60
Neutral
$48.67B4.58-11.27%4.14%2.83%-41.78%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
JP:9449
GMO Internet
3,838.00
1,146.39
42.59%
JP:3774
Internet Initiative Japan
2,817.00
-137.91
-4.67%
JP:9436
Okinawa Cellular Telephone Company
2,807.00
633.68
29.16%
JP:3776
Broadband Tower, Inc.
199.00
20.24
11.32%
JP:3842
Nextgen,Inc.
995.00
5.93
0.60%
JP:9424
Japan Communications Inc.
139.00
14.00
11.20%

GMO Internet Corporate Events

GMO Internet Group Announces Share Repurchase as Part of Long-term Buyback Plan
Dec 3, 2025

GMO Internet Group, Inc. announced the repurchase of 342,100 of its own shares for approximately JPY 1.37 billion as part of a long-term share buyback plan. This move is part of a broader strategy to enhance shareholder returns, with a total of up to 4.2 million shares authorized for repurchase, reflecting 4.14% of outstanding shares, at a cost of up to JPY 10 billion.

GMO Internet Group Announces JPY 10 Billion Treasury Share Buyback
Nov 25, 2025

GMO Internet Group, Inc. has announced a plan to acquire up to JPY 10 billion worth of its own treasury shares as part of its revised Total Shareholder Returns Policy. This move aims to enhance capital efficiency and expand corporate value, with the acquisition period set from November 26, 2025, to February 12, 2026, through open market purchases on the Tokyo Stock Exchange.

GMO Internet Group Announces Tender Offer for Prime Strategy
Nov 25, 2025

GMO Internet Group, Inc. has announced its decision to acquire shares of Prime Strategy Co., Ltd. through a tender offer, aiming to make it a consolidated subsidiary. This move is part of a capital and business alliance agreement, expected to create synergies between Prime Strategy’s high-performance platform ‘KUSANAGI’ and GMO’s internet services, enhancing their market position without delisting Prime Strategy from the Tokyo Stock Exchange.

GMO Internet Group to Receive Significant Dividend from Subsidiary
Nov 17, 2025

GMO Internet Group, Inc. announced it will receive a dividend of JPY 4,488 million from its subsidiary, GMO Payment Gateway, Inc. This dividend will be recorded as net sales in the company’s non-consolidated financial results for the fiscal year ending December 31, 2025, with no impact on its consolidated business performance.

GMO Payment Gateway Reports Strong Financial Growth for FY 2025
Nov 13, 2025

GMO Payment Gateway, Inc., a subsidiary of GMO Internet Group, reported significant growth in its financial results for the fiscal year 2025 compared to the previous year. The increase in net sales and operating profit was driven by a smooth progression in the payment processing business, with higher transaction volumes. Additionally, ordinary and net profits saw substantial growth due to increased dividend income from consolidated subsidiaries, indicating a strong financial performance and positive outlook for stakeholders.

GMO Internet Group Announces Q3 2025 Dividend Payout
Nov 13, 2025

GMO Internet Group, Inc. announced a quarterly dividend payout of ¥9.5 per share for the third quarter of FY2025, reflecting a 33.1% payout ratio. This decision aligns with the company’s policy to return 50% of profits to shareholders, demonstrating a commitment to shareholder value and financial flexibility.

GMO Internet Group Reports Strong Q3 2025 Financial Results Amid Market Uncertainties
Nov 13, 2025

GMO Internet Group, Inc. reported its financial results for the third quarter of fiscal year 2025, showing a year-on-year increase in net sales by 3.7% and a significant rise in profit attributable to owners by 33.4%. Despite the positive financial performance, the company did not provide a consolidated business results forecast due to market uncertainties affecting its core business areas.

GMO Internet Group Sells Shares to Meet Listing Criteria and Enhance Value
Oct 28, 2025

GMO Internet Group, Inc. has partially sold shares of its subsidiary, GMO Internet, to comply with listing criteria on the TSE Prime Market, expecting to record an extraordinary profit of approximately ¥7.2 billion. This move is aimed at improving the tradable share ratio, enhancing liquidity, and sustaining corporate value, with minimal impact on consolidated profit or loss, while continuing efforts to strengthen investor relations and meet compliance deadlines.

GMO Internet Group Corrects Dividend Income Classification
Sep 29, 2025

GMO Internet Group, Inc. has issued a correction regarding the classification of dividend income from its consolidated subsidiary. The correction changes the classification of the dividend income from non-operating income to net sales in its non-consolidated financial results for the fiscal year ending December 31, 2025, without impacting the consolidated business performance.

GMO Internet Group Transfers Forex Subsidiary to Focus on Growth
Sep 19, 2025

GMO Internet Group, Inc. announced that its subsidiary, GMO Financial Holdings, Inc., has decided to transfer all shares of GMO-Z.com Forex HK Limited to Remi Holding Group Limited. This move aligns with GMO-FH’s strategy to strengthen its earnings base and focus on areas with growth potential, thereby enhancing its operational strengths and supporting sustainable growth.

GMO Internet Group to Receive Subsidiary Dividend
Sep 16, 2025

GMO Internet Group, Inc. announced it will receive a dividend of JPY 5,740 million from its subsidiary, GMO AD Holdings, Inc. This dividend will be recorded as non-operating income in the company’s financial results for the fiscal year ending December 31, 2025, without affecting its consolidated business performance.

GMO Internet Group Completes Share Repurchase Program
Sep 8, 2025

GMO Internet Group, Inc. has completed a share repurchase program, acquiring 78,000 of its common shares at a total cost of JPY 305,127,100. This move is part of a long-term strategy to enhance shareholder returns, as outlined in a previous policy revision, and aims to repurchase up to 4.40% of outstanding shares by February 2026.

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.Date of analysis: Nov 28, 2025