Rakuten Group on Wednesday reported a group net loss of ¥339.4 billion for the year through December, its second-largest annual loss ever, as its mobile phone operations continued to struggle.
The Japanese cybermall and mobile phone company incurred a net loss for the fifth straight year, though the loss was smaller than the year-before level of ¥377.2 billion.
Rakuten will skip a dividend payment for the first time in 23 years to prioritize its financial stability.
The mobile phone business posted an adjusted operating loss of ¥337.5 billion, smaller than the year-before loss of ¥479.2 billion. The number of subscribers rose to 6.09 million as of the end of 2023 from 4.46 million a year before.
The company aims to raise the number of subscribers to 8 million by the end of this year, the minimum level needed to turn around its mobile phone operations. As part of the effort, the company will offer a new discount program for families on Feb. 21.
Rakuten needs to redeem corporate bonds totaling about ¥800 billion in 2024 and 2025, raising concerns about the company’s financing.
The company plans to effectively delay the redemption of some bonds, including by buying bonds due in November this year using proceeds from issuance of $1.8 billion worth of bonds maturing in February 2027.
“The refinancing risk for 2024 has disappeared,” Rakuten Chairman and CEO Hiroshi Mikitani said during a news briefing. “There’s not much to worry about after that.”
The Rakuten Ichiba cybermall and other online services fared well, as did financial technology operations, including the Rakuten Card credit card business.