Fiscal Year 2023 First Quarter Consolidated Financial Results (Japanese GAAP)May 11, 2023
Name of Listed Company: GMO Internet Group, Inc.
Exchange Listing: Tokyo Stock Exchange
Stock Code: 9449
URL: https://www.gmo.jp/en
Representative: Masatoshi Kumagai, Founder, Chairman and Group CEO
Official Contact: Masashi Yasuda, Director, Executive Vice President and Group CFO,
Deputy to Group CEO, Head of Group Management Division
Contact Number: +81-3-5456-2555
Date of Quarterly Report Release: May 15, 2023 Start Date of Dividend Payout: June 15, 2023
Supplementary documents available pertaining to quarterly financial results: Yes
Quarterly results briefing: Yes (live stream only and Q&A session for institutional investors)(all amounts rounded down to the nearest million yen)
1. First Quarter Financial Results in the Year Ending December 2023 (01.01.2023 - 03.31.2023)(1) Consolidated Operating Results(percentages shown represent year-on-year % change)
Profit Attributable to
Net Sales
Operating Profit
Ordinary Profit
Owners of the
ParentThree months ended¥ millions%¥ millions%¥ millions%¥ millions%

March 31, 2023
65,59317.0
10,990-1.2
11,933-1.4
3,931 -38.9
March 31, 2022
56,065-8.5
11,128 -10.8
12,099 -10.7
6,431
13.7
(Note) Comprehensive Income: March 31, 2023: 7,193 million (-36.1%), March 31, 2022: 11,265 million (-13.3%)
Net Profit per
ShareThree months ended

March 31, 2023
March 31, 2022

Net Profit per Share(Diluted)

¥

¥

36.83
59.32

36.52
58.90

(2) Consolidated Financial Condition
Total Assets
As ofShareholders’ Equity
Ratio

Net Assets¥ millions¥ millions%

March 31, 2023
1,624,445
161,059
4.6
December 31, 2022
1,542,740
154,688
4.7(Reference) Shareholders’ Equity: March 31, 2023: ¥75,439 million; December 31, 2022:¥72,176 million
2. Dividends
Annual Dividends
End of Q1

Year Ended 12/2022
Year Ending 12/2023
Year Ending 12/2023 (forecast)End of Q2

End of Q3

End of Term

Total

¥

¥

¥

¥

19.60
12.20

28.00

0.00

0.00

47.60

－

－

－

－

¥

3. Consolidated Results Forecast for the Year Ending December 31, 2023 (01.01.2023 – 12.31.2023)

As the Group's business “Internet Finance business,” "Cryptoassets business" and “Incubation
business” are affected by economic conditions, financial markets, cryptoassets and other market
conditions, it is difficult to forecast business performance, and therefore we do not disclose
consolidated business results and dividend forecast. GMO Financial Holdings Co., Ltd., oursubsidiary, discloses sales indicators, such as foreign exchange transaction volume, stock
brokerage trading value, CFD trading value, cryptoasset trading value and the number of customer
accounts, and operating revenue on a monthly basis.

*Notes(1) Changes to significant subsidiaries in the current term: No(2) Special accounting treatments used in preparation of the quarterly consolidated financial statements:
None(3) Changes in accounting policy, changes in accounting estimates, restatements
1. Changes resulting from revisions to accounting standard, etc.: Yes
2. Changes other than those specified above: None
3. Changes in accounting estimates: None
4. Restatements: None
(4) Number of Outstanding Shares (Common Shares)(Unit: shares)

1. Outstanding shares at period end (inc. treasury)

Q1 FYE 12/2023

110,113,337

FYE 12/2022

110,704,401

2. Treasury shares at period end

Q1 FYE 12/2023

3,388,544

FYE 12/2022

3,979,562

3. Average number of shares during the period

Q1 FYE 12/2023

106,724,838

Q1 FYE 12/2022

108,415,437*Quarterly financial results are not subject to quarterly review by independent auditors.
*Note regarding the appropriate use of result forecasts and other items
Although the Company aims to pay dividends quarterly with a payout ratio of 33% to net income
attributable to owners of the parent, because it is difficult to forecast business performance, the amountof dividend forecast is yet to be determined at this time. We will promptly disclose dividend forecast
when it becomes available.
On May 11, 2023, we plan to stream a financial results briefing live. The presentation and explanation(voice) along with explanatory materials used on the day will be posted on our company website(https://ir.gmo.jp/en/) promptly after the meeting.

Contents

1. Qualitative Information Related to Financial Results. ............................................................................... 2(1) Operating results ................................................................................................................................. 2(2) Financial condition ............................................................................................................................... 8(3) Consolidated results forecast and other forward-looking information ................................................. 8
2. Quarterly Consolidated Financial Statements and Major Notes ............................................................... 9(1) Quarterly consolidated balance sheet ................................................................................................. 9(2) Quarterly consolidated statements of income and comprehensive income ...................................... 11(3) Notes regarding the quarterly consolidated financial statements ...................................................... 13
Notes regarding the going concern assumption ................................................................................ 13
Notes regarding changes impacting shareholders’ equity ................................................................. 13
Changes in accounting policies ......................................................................................................... 13
Additional information ........................................................................................................................ 13
Segment information, etc. .................................................................................................................. 14
Significant subsequent event ............................................................................................................. 15―1―

1. Qualitative Information Related to Financial Results(1) Operating results◆

Overview of the Financial Results for the Three Months Ended March 31, 2023
(Unit: ¥millions)

Previous Q1

Current Q1

Change% Change

Net Sales

56,06565,593

9,527

17.0%

Operating Profit

11,128

10,990

-137

-1.2%

Ordinary Profit

12,09911,933

-166

-1.4%

Profit Attributable to Owners of the Parent

6,431

3,931

-2,499-38.9%

Under the corporate slogan “Internet for Everyone” GMO Internet Group has consistently focusedresources on the service to provide internet and service infrastructure since its foundation in 1995.
With the increased usage of the Internet, the volume of information available on the Internet and thevolume of transactions conducted over the Internet have increased exponentially, which has opened
new business opportunities for the Group one after another, and as a result, the Group reported
increases both in net sales and profit for the year ended December 31, 2022, marking its 14th
straight yearly increase.
While there are signs of economic recovery following the implementation of the countermeasures
to prevent the spread of COVID-19, the progress of Digital Transformation (DX) and the spread of
online consumption have become an irreversible trend, and we believe the need for our services
continues to increase.
Amidst such a business environment, (1) the Internet Infrastructure segment, comprising many ofJapan’s No.1 services, reported record quarterly earnings with the expansion of customer base,boosted by steady growth mainly in Payment and Security thanks to large orders related to sales ofcashless payment terminals and year-end demand in the cybersecurity business. (2) In the Online
Advertising & Media segment, while revenue increased mainly in in-house products and our own
media, profit decreased due partly to a temporary increase in advertising distribution costs. (3) In theInternet Finance segment, both FX and CFD showed strong growth, which contributed to a high levelof revenue exceeding FY2022 Q1 which reported strong results due to fluctuations in resource prices.
(4) The Cryptoassets segment continues to experience a severe environment as the trading in theoverall cryptoasset market has been sluggish.
As a result, for the three months ended March 31, 2023, the Group recorded net sales of ¥65,593
million (up 17.0% year-on-year), operating profit of ¥10,990 million (down 1.2% year-on-year),ordinary profit of ¥11,933 million (down 1.4% year-on-year) and net profit attributable to owners of theparent of ¥3,931 million (down 38.9% year-on-year).

―2―Net Sales and Operating Profit by Segment for the Three Months Ended March 31, 2023
(Unit: ¥millions)

Previous Q1

Current Q1

34,7596,283

42,161
6,994

7,402
711

21.3%
11.3%

7,892
927

8,904
668

1,011
-259

12.8%
-28.0%

10,796
3,650

12,792
3,762

1,995
112

18.5%
3.1%

2,062
159

1,202
-338

-860
-497

-41.7%
－

536
252

195
108

-341
-143

-63.7%-57.0%

835
-90

1,447
-122

612
-32

73.3%
－

-817
-53

-1,110
-80

-292
-27

－
－

56,065
11,12865,593
10,990

9,527
-137

17.0%
-1.2%

Internet Infrastructure
Net Sales
Operating Profit
Online Advertising & MediaNet Sales
Operating Profit
Internet Finance
Net Sales
Operating Profit
Cryptoassets
Net Sales
Operating Profit
Incubation
Net Sales
Operating Profit
Other
Net Sales
Operating Profit
Adjustment
Net Sales
Operating Profit
Total
Net Sales
Operating Profit

Change% Change1) Internet Infrastructure
The Internet Infrastructure segment provides basic and service infrastructure for customers operating
business in an online environment. Domain, hosting & cloud, ecommerce solutions, payment andsecurity - the five major businesses in this segment – are all developed and offered in-house andeach holds top share in their respective markets in Japan. In addition, the segment includes
consumer Internet provider services. The following is a breakdown of results in each of thebusinesses comprising this segment.
i. Domain
Positioned as a gateway to the Group’s infrastructure segment, the domain business continues togrow its customer base with a low-pricing strategy mainly through the Company and GMO Pepabo.
The number of domain registration and renewals during the three months ended March 31, 2023 was
1.59 million (up 24.0% year-on-year), the total number of domains under management as of March
31, 2023 was 7.18 million (down 1.4% year-on-year) and net sales were ¥2,291 million (up 3.2%
year-on-year).
ii. Hosting & cloud
The hosting & cloud business responds to growing diversification of client needs through shared,
dedicated, VPS and cloud-based offerings under a multi-brand strategy mainly through the Company,
GMO GlobalSign Holdings and GMO Pepabo. Thanks to the favorable growth in sales of retail server,
the number of web hosting contracts as of March 31, 2023 was 1,117 thousand (up 2.2% year-onyear) and net sales were ¥4,810 million (up 7.3% year-on-year).
iii. Ecommerce solutions
Ecommerce solutions are offered mainly by GMO Pepabo and GMO MAKESHOP and comprises EC
platforms that provide platforms for online stores, minne, a C2C handmade market, SUZURI, an―3―

original merchandise production/sales service, and O2O support service.
In EC platform, the number of paid stores as of March 31, 2023 decreased 12.1% year-on-year to 56
thousand despite an increase in the number of users of the free plan of Color me shop that allows toopen an online store without a monthly fee. The total transaction volume was ¥120.8 billion (down
1.4% year-on-year) due to the impact of the change in the consumption trends on Color me shop.
minne was also affected by the change in the consumption trends, and the total transaction volume
decreased by 9.7% year-on-year to ¥3.7 billion. On the other hand, Makeshop which offers high-priceplans showed strong growth, and net sales were ¥3,995 million (up 12.2% year-on-year).
iv. Security
This business offers security services to provide secure and safe Internet for everyone, including
digital certification security such as SSL server certificates and e-contract service GMO Sign
provided mainly through GMO GlobalSign Holdings, cybersecurity provided by GMO Cybersecurity
by Ierae, and brand security provided by GMO BRAND SECURITY. Results of GMO Cybersecurity
by Ierae are included in the consolidated results from the three months ended June 30, 2022.
Sales in e-contract service GMO Sign showed strong growth, with large increases in the number ofcustomers and contract transmission. GMO Cybersecurity by Ierae also showed favorable growth
due to demand towards the year-end. As a result, this sub-segment reported net sales of ¥4,658
million (up 83.8% year-on-year).
v. Payment
Payment services are mainly operated by GMO Payment Gateway and offer comprehensive
payment-related service and finance-related services. The payment-related service showed favorable
growth due to steady expansion of the Ecommerce market in online/recurring payments and anincrease in the number of stores using a next-generation payment platform “stera” terminal in theface-to-face payments. As a result, the number of transactions and the transaction volume increased,
and net sales increased to ¥15,386 million (up 27.9% year-on-year).
vi. Provider
In this sub-segment, the Company offers Internet provider services for consumers. The number ofsubscriptions at March 31, 2023 was 2.26 million (up 1.0% year-on-year) and net sales were ¥10,011
million (up 6.3% year-on-year) due to strong growth in the fixed line service.
Overall, the Internet Infrastructure segment recorded net sales of ¥42,161 million (up 21.3% year-onyear) and operating profit of ¥6,994 million (up 11.3% year-on-year), hitting a quarterly record high.
2) Online Advertising & MediaThe Online Advertising & Media segment provides marketing solutions for online businesses. The
following is a breakdown of results in each of the businesses comprising this segment.
i. Online advertisingThis sub-segment provides comprehensive Internet advertising services such as advertising agency
and ad platform mainly through GMO AD Partners and GMO TECH. The transaction volume
increased as advertising demand increased in anticipation of the economic activities returning tothose with face-to-face services and also because it coincided with the peak season of certain
industries. Our own affiliate advertising also showed solid growth. As a result, net sales amounted to¥4,628 million (up 20.8% year-on-year).
ii. Internet media
This sub-segment provides advertising space through operation of our own media and the marketing
support services mainly through GMO Media. Thanks to increases in pageviews and the number ofcustomers of our own media, net sales amounted to ¥2,856 million (up 5.5% year-on-year).
Overall, net sales in the Online Advertising & Media segment increased to ¥8,904 million (up 12.8%
year-on-year), but operating profit decreased to ¥668 million (down 28.0% year-on-year) due toincreased outsourcing costs in response to an expansion of the transaction volume and a temporary―4―

increase in advertising distribution costs.
3) Internet Finance
The Internet Finance segment provides online financial services for retail investors mainly through
GMO Click Securities, a consolidated subsidiary of GMO Financial Holdings. The customer basecontinues to expand, with the number of OTC FX accounts increasing to 1,441 thousand (up 4.1%
year-on-year) and the number of securities accounts increasing to 511 thousand (up 5.0% year-onyear). The OTC FX improved profitability compared to FY2022 Q1 through enhanced efforts toimprove profitability while maintaining the transaction volume at the high level. CFD posted anincrease in revenue thanks to the thriving commodity market while trading value decreased year-onyear. Meanwhile, profit increased year-on-year only slightly due to recognition of provision ofallowance for doubtful debts of approximately ¥1.5 billion related to the securities business inThailand.
Overall, the Internet Finance segment recorded net sales of ¥12,792 million (up 18.5% year-on-year)
and operating profit of ¥3,762 million (up 3.1% year-on-year).
4) Cryptoassets
The Cryptoassets segment operates businesses pertaining to “mining” and “exchange” ofcryptoassets. Performance of each business is as follows.
i. Cryptoassets mining
The Cryptoassets mining business runs mining centers. Profitability decreased year-on-year due toincreased hash rates, and net sales amounted to ¥278 million (down 67.5% year-on-year).
ii. Cryptoassets exchangeThis sub-segment is engaged primarily in spot trading and leveraged transactions of cryptoassets
mainly through GMO Coin, a consolidated subsidiary of GMO Financial Holdings. The customer base
expanded with the number of customer accounts as of March 31, 2023 increasing to 559 thousand(up 11.7% year-on-year). On the other hand, because of a decline in the trading value due to thesluggish trends in the cryptoasset market, net sales decreased to ¥921 million (down 14.6% year-onyear).
Overall, the Cryptoassets segment reported year-on-year decrease in both net sales and profit with
net sales of ¥1,202 million (down 41.7% year-on-year) and operating loss of ¥338 million (operating
profit of ¥159 million for the three months ended March 31, 2022).
5) Incubation
This segment is engaged in investing in domestic and overseas internet related companies aimed at
capital gains, supporting business expansion, and supporting corporate value improvement mainly
through GMO Venture Partners. Net sales were ¥195 million (down 63.7% year-on-year), andoperating profit was ¥108 million (down 57.0% year-on-year) due to sales of shareholdings.

(Reference1)

Changes in Operating Results and Financial Condition by QuarterQ1 2022Net sales
Operating profit
Ordinary profit
Profit attributableto owners of the parent
Total assets
Shareholders’ equity

Q2 2022

Q3 2022

Q4 2022(Unit: ¥millions)Q1 2023

56,065
11,12812,09969,49019,812
21,382

57,5787,069
8,955

62,561
5,736
3,586

65,593
10,99011,933

6,431

9,074

-1,651

-644

3,931

1,487,484
70,415

1,433,731
78,904

1,545,403
74,209

1,542,740
72,176

1,624,445
75,439―5―

(Reference2)
Table: Quarterly Results by Segment
I Net Sales by Segment
Internet Infrastructure
Provider (ISP)
DomainHosting & cloud
Ecommerce solutions
Security
Payment
Other
Total
Online Advertising & Media
Online advertisingInternet media
Internet research & other
Total
Internet Finance
Total
Cryptoassets
Cryptoassets exchange
Cryptoassets mining
Cryptoassets payment
Total
Incubation
Total
Sub total
Other
Adjustment
Net Sales(Unit: ¥millions)
Q4 2022
Q1 2023

Q1 2022

Q2 2022

Q3 2022

9,420
2,221
4,484
3,559
2,534
12,025512
34,759

9,606
2,244
4,569
3,622
3,090
12,657874
36,666

10,009
2,379
4,693
3,846
3,285
13,108749
38,074

9,944
2,130
4,703
4,173
3,838
14,5791,174
40,544

10,011
2,291
4,810
3,995
4,658
15,386
1,007
42,161

3,831
2,707
1,353
7,892

4,937
2,401
1,174
8,512

5,076
2,598
1,211
8,886

4,755
2,613
1,401
8,770

4,628
2,856
1,418
8,904

10,796

10,363

10,002

11,38912,792

1,078
856
127
2,062

890
394
10
1,294

527
241
6
775

1,654
270
154
2,079

921
278
2
1,202

536
56,047835-817
56,065

12,856
69,693865-1,06869,490057,738903-1,06357,578062,783958-1,18162,561

195
65,255
1,447-1,11065,593Q1 2022
6,283
927
3,650
159
252
11,272-90-53
11,128Q2 2022
5,586
547
2,975
-397
10,162
18,874-3
941
19,812Q3 2022
4,753
737
2,683
-821
-96
7,256
-85
-101
7,069

Q4 2022
5,363
-24
-17
717
-223
5,816
-60
-20
5,736

Q1 2023
6,994
668
3,762
-338
108
11,194-122-80
10,990

II Operating Profit by Segment
Internet Infrastructure
Online Advertising & MediaInternet Finance
Cryptoassets
Incubation
Sub total
Other
Adjustment
Operating Profit―6―

(Reference3)
Description of businesses in each segment
Business Segment
DomainHosting & cloud

Ecommerce
solutionsInternet
Infrastructure

Security

Payment

OnlineAdvertising &Media

Main Operations
・Domain registry services including “.shop” and “.tokyo”
・Domain registrations services: Onamae.com, MuuMuu Domain, and
VALUE-DOMAIN
・Provision, operation, management, and maintenance of shared, VPS,
dedicated and cloud-based web hosting services including Onamae.com
Rental Server, ConoHa by GMO, Z. com Cloud, GMO Cloud VPS, GMO
Cloud ALTUS, GMO Cloud Private, Lolipop!, heteml, and 30days Album
・Operation of EC platform to set up net shop offered by Color me shopand MakeShop.
・Operation of C2C handmade marketplace “minne”
・Operation of production/sales service of original merchandise including
SUZURI and canvath・Operation of ecommerce/O2O support services, etc.
・Operation of OMAKASE, reservation management service forrestaurants
・Web design, operational support and system consulting, etc.
・DomainSSL, OrganizationSSL, and other SSL certificates, code signing
certificates, PDF document signing, client certificates and other digital
certificate services
・e-contract service “e-contract service GMO Sign”
・Cybersecurity service including vulnerability assessment of web andsmartphone applications, penetration test and security incident response
・Brand security service including brand protection measures, detectionand elimination of fake products, provision of trademark management
system, and acquisition and management of domain name
・PG Multi-Payment Service for mail order and ecommerce business,
comprehensive payment processing services for public sector, andfinance-related service including early payment service, transaction
lending, and GMO payment after delivery

Provider・GMO TokuToku BB and other Internet provider services.

Onlineadvertising・Comprehensive online advertising service including listing, mobile andad networks, reward advertising, affiliate advertising.
・Advertising planning and production

・Operation of online media such as community site for teenage girls“prican,” programming educational portal “coeteko,” point site “Point
Town,” game platform “gesoten,” joint purchase coupon site “Kumapon”
Internet media
and aesthetic medical ticket purchase site “KIREIPASS,” life informationsite for career women “michill” and ad distribution to own media
・SEM Media: Sales of SEO.
Internet research ・Provision of Internet research systems, management and operation of& other
research panel including GMO Research Cloud PanelInternet FinanceInternet finance・Operation of online securities trading, FX trading, CFD trading, etc.
・Spot trading and leveraged transactions of cryptoassets, etc.

Cryptoassets

Cryptoassets
exchange
Cryptoassets
miningCryptoassets
payment
Venture capital・Investment in private Internet startups

Incubation

・Operation of mining centers
・Issuance and redemption of stablecoin “GYEN” and “ZUSD”―7―

(2) Financial condition
Assets, Liabilities and Net Assets(Assets)
As of March 31, 2023, total assets increased ¥81,704 million from December 31, 2022 to ¥1,624,445
million. Major factors included an increase of ¥16,892 million in cash and deposits, an increase of
41,766 million in cryptoassets under custody, an increase of ¥10,975 million in various assets due tofluctuations in customer assets in the Securities segment (deposits, margin transaction assets, loan
secured by securities, short-term guarantee deposits and variation margin paid) and an increase of¥4,533 million in tangible fixed assets.
(Liabilities)
As of March 31, 2023, total liabilities increased ¥75,333 million from December 31, 2022 to¥1,463,385 million. Major factors included an increase of ¥19,800 million in bonds, an increase of¥41,049 million in deposits received for cryptoassets and an increase of ¥17,133 million in various
liabilities due to fluctuations in customer assets in the Securities segment (deposits received, margintransaction liability, guarantees received, variation margin received, and loans payable secured by
securities).
(Net Assets)
As of March 31, 2023, total net assets increased ¥6,370 million from December 31, 2022 to¥161,059 million. Major factors included an increase of ¥2,421 million in earned surplus (consistingof an increase from recording profit attributable to owners of the parent totaling ¥3,931 million and adecrease from retirement of treasury stock of ¥1,510 million), an increase of ¥3,103 million in noncontrolling interests, and a decrease of ¥1,509 million due to acquisition and retirement of treasury
stock.
(3) Consolidated results forecast and other forward-looking information
For the fiscal year ending December 31, 2023, the Group plans to increase both net sales andoperating profit, mainly in Internet Infrastructure segment. Meanwhile, there are certain factors thatcannot be reasonably predicted at this point, including: (1) fluctuation of cryptoasset prices andglobal hash rate trends in Cryptoassets business, (2) potential impact of economic situations andmarket conditions in Internet Finance segment, and (3) when and how much capital gains will be
realized in Incubation segment. Accordingly, we do not disclose the consolidated results forecast for
the fiscal year ending December 31, 2023.

―8―

2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheet
Previous Fiscal Year(As of Dec 31, 2022)(Unit: ¥millions)
1st Quarter
Current Fiscal Year(As of Mar 31, 2023)

AssetsCurrent Assets
Cash and deposits

341,970

358,863

Trade notes, accounts receivable and contract
assets33,96336,257

Operational investment securities

11,724

12,161

Cryptoassets under custody

61,751

103,518

Securities segment deposits

486,478

498,334

Securities segment margin transaction assets

143,065

140,058

Securities segment loan secured by securities

12,69519,017

Securities segment short term guarantee deposits

73,97570,923

Securities segment variation margin paid

94,21993,076

Other

156,759

156,675

Allowance for doubtful debts
Total Current Assets-8,590-5,1401,408,015

1,483,746

45,82550,35817,70817,217

Fixed Assets
Tangible fixed assets
Intangible fixed assets
Goodwill
Software11,472

11,613

Other

16,756

17,296

Total intangible fixed assets

45,936

46,127

Investment securities

29,78029,755

Deferred tax asset

4,053

4,399

Other

9,791

16,413

Investments and other assets

Allowance for doubtful debts
Total investments and other assets
Total Fixed Assets
Total Assets

―9―

-662

-6,35542,96344,212

134,725

140,698

1,542,740

1,624,445

(Unit: ¥millions)
1st Quarter
Current Fiscal Year(As of Mar 31, 2023)

Previous Fiscal Year(As of Dec 31, 2022)
Liabilities
Current Liabilities
Trade notes and accounts payable

14,43014,304

Short term debt

222,018

185,923-200

Current portion of bonds
Amount payable

47,07541,264

Deposits received for cryptoassets

61,734

102,784

Securities segment deposits received

53,57350,572

Securities segment margin transaction liability

35,92946,981

Securities segment guarantees received

554,407556,798

Securities segment variation margin received

11,2598,217

Securities segment loans payable secured by securities

26,23335,966

Accrued corporate tax, etc.

7,324

10,200Allowance for bonuses

2,293

1,421

Allowance for bonuses to directors
Allowance for contract loss

657

296

6,341

6,341

Advance payment received

3,195

3,258

Contract liabilities

18,314

19,518Deposits received

122,657

121,078

Other

20,202

20,196

1,207,649

1,225,325

Bonds

51,00070,800Convertible bonds with equity warrants

20,77020,715Long term debt

97,373

135,256

Deferred tax liability

1,319

1,288

Other

8,988

9,052

179,451

237,112Financial instruments transaction liability reserve

949

948

Total Statutory Reserve

949

948

1,388,051

1,463,385

Total Current Liabilities
Fixed Liabilities

Total Fixed Liabilities
Statutory Reserve

Total Liabilities
Net Assets
Shareholders’ Equity
Capital stock

5,000

5,000

Capital surplus

33,28033,259Earned surplus

37,73040,152

Treasury stock-10,166-8,656

Total Shareholders’ Equity

65,84369,754

3,397

2,518

Accumulated Other Comprehensive Income
Other securities valuation differences
Deferred hedging profit/loss

48

-104

Foreign currency translation adjustments

2,886

3,271

Total Accumulated Other Comprehensive Income

6,332

5,684

Equity Warrants
Non-controlling Interests
Total Net Assets
Total Liabilities and Net Assets

―10―

43

46

82,46985,572

154,688

161,059

1,542,740

1,624,445

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income
1st Quarter(Unit: ¥millions)
1st Quarter
Previous Fiscal Year
(3 months to March 2022)
56,065

1st Quarter
Current Fiscal Year
(3 months to March 2023)
65,593

Cost of Sales

21,78827,180Gross Profit on Sales

34,276

38,412

Sales, General & Administrative Expenses

23,14827,421

Operating Profit

11,128

10,990

Dividends received

299

325

Foreign exchange gain

789

66

Gain on investments in partnership

61

292

Net Sales

Non Operating Revenue

Other

207

1,072

1,358

1,757

Interest paid

177

342

Commission paid

22

184

Bond issuance cost－

154

Equity method investment losses

154

73

Other

33

58

Total Non Operating Revenue
Non Operating Expenses

Total Non Operating Expenses
Ordinary Profit

387

814

12,09911,933

2,489

44

－

1

Extraordinary Profit
Gain on sale of investment securities
Reversal of financial instruments transaction
liability reserve
Other

11

0

2,501

46

2

－

Loss on disposal of fixed assets

3

14

Other

－

0

Total Extraordinary Loss

5

14

Net Profit before Adjustment for Tax, etc.

14,596

11,965

Corporate, Municipal and Enterprise Taxes

4,320

4,437

Corporate Tax etc. Adjustment

-329

21

Total Corporate Taxes, etc.

3,991

4,458

Net Profit

10,604

7,507

Profit attributable to Non-controlling Interests

4,173

3,575

Profit attributable to Owners of the Parent

6,431

3,931

Total Extraordinary Profit
Extraordinary Loss
Provision of financial instruments transaction
liability reserve―11―Quarterly consolidated statement of comprehensive income
1st Quarter(Unit: ¥millions)

Net Profit

1st Quarter
Previous Fiscal Year
(3 months to March 2022)
10,604

1st Quarter
Current Fiscal Year
(3 months to March 2023)
7,507

-954

-1,056

-

-228

1,572

884

42

86

Other Comprehensive Income
Other securities valuation differences
Deferred hedging profit/loss
Foreign currency translation adjustments
Share of other comprehensive income of associates accounted
for using equity method
Total other comprehensive income

661

-313

11,265

7,193

Comprehensive income attributable to owners of the parent

7,473

3,283

Comprehensive income attributable to non-controlling interests

3,792

3,909

Comprehensive Income(Breakdown)―12―(3) Notes regarding the quarterly consolidated financial statements(Notes regarding the going concern assumption)
Not applicable.
(Notes regarding changes impacting shareholders’ equity)
Pursuant to the resolution at the Board of Directors meeting held on February 13, 2023, theCompany retired 591,064 shares of treasury stock, which resulted in decreases in earned surplus
and treasury stock of ¥1,510 million, respectively.
As a result, earned surplus and treasury stock as of March 31, 2023 were ¥40,152 million and¥8,656 million, respectively.
(Changes in accounting policies)(Application of Implementation Guidance on Accounting Standard for Fair Value Measurement)
On January 1, 2023, the Company applied “Implementation Guidance on Accounting Standard for
Fair Value Measurement” (Accounting Standards Board of Japan (“ASBJ”) Guidance No.31, June 17,
2021, “Implementation Guidance on Accounting Standard for Fair Value Measurement”), and the new
accounting policies stipulated in the Implementation Guidance on Accounting Standard for Fair Value
Measurement are applied prospectively pursuant to the transitional treatment stipulated by
Paragraph 27-2 of the Implementation Guidance on Accounting Standard for Fair Value
Measurement. The application had no impact on the quarterly consolidated financial statements.
(Additional information)(Application of Practical Solution on the Accounting and Disclosure Under the Group Tax Sharing
System)Effective January 1, 2023, the Company and its certain domestic consolidated subsidiaries
transitioned from the consolidated taxation system to the group tax sharing system and accordingly
follow “Practical Solution on the Accounting and Disclosure Under the Group Tax Sharing System”(Practical Issues Task Force (PITF) No.42, August 12, 2021, “PITF No.42”) for accounting treatment
and disclosure of corporate tax, local corporate tax and tax effect accounting. Based on Paragraph
32 (1) of PITF No.42, the Company believes that there is no impact of the changes in accounting
policies as a result of the application of PITF No.42.

―13―

(Segment Information, etc.)【Segment information】
I 1st Quarter of Previous Fiscal Year (01.01.2022-03.31.2022)
1. Information relating to net sales and profit or loss by reportable segment(Unit: ¥millions)
Reportable Segment
Internet
Finance

Other
(*i)

Adjustment Consolidated(*ii)
P/L (*iii)

Internet
Infrastructure

Online Ad& Media

34,4897,432

10,791

2,062

536

55,312752－

56,065

269

460

5

－

－

734

82

-817

－

34,759

7,892

10,7962,062

536

56,047835-817

56,065

6,283

927

3,650

159

252

11,272-90-53

11,128Cryptoassets Incubation

Total

Net Sales
Sales to unaffiliatedcustomers
Intersegment
transactions ortransfer
Total
Segment Profit/Loss*Notesi. “Other” represents real estate leasing, mobile entertainment and other businesses not included inreportable segments.
ii. Segment profit/loss adjustment (¥-53 million) is an elimination of intersegment transactions.
iii. Segment profit/loss is based on operating profit in the quarterly consolidated statement of income.
2. Information on impairment losses on fixed assets or goodwill, etc. by reporting segment(Significant change in goodwill)
The Internet Infrastructure segment acquired shares of GMO Cybersecurity by Ierae, Inc. andincluded the company in the scope of consolidation, which resulted in the recognition of goodwill.
The resulting increase in goodwill during the three months ended March 31, 2022 was ¥7,606
million. The amount of goodwill reflects the review after the provisional accounting treatment for thebusiness combination was finalized.

II 1st Quarter of Current Fiscal Year (01.01.2023-03.31.2023)
1. Information relating to net sales and profit or loss by reportable segment(Unit: ¥millions)
Reportable Segment
Internet
Finance

Other
(*i)

Adjustment Consolidated(*ii)
P/L (*iii)

Internet
Infrastructure

Online Ad& Media

41,8098,261

12,7871,202

195

64,255

1,337－

65,593

351

642

5

－

－

999

110

-1,110－42,161

8,904

12,792

1,202

195

65,255

1,447-1,11065,593

6,994

668

3,762

-338

108

11,194-122-80

10,990

Cryptoassets Incubation

Total

Net Sales
Sales to unaffiliatedcustomers
Intersegment
transactions ortransfer
Total
Segment Profit/Loss*Notesi. “Other” represents real estate leasing, mobile entertainment and other businesses not included inreportable segments.
ii. Segment profit/loss adjustment (¥-80 million) is an elimination of intersegment transactions.
iii. Segment profit/loss is based on operating profit in the quarterly consolidated statement of income.

―14―

(Significant subsequent event)Not applicable.

―15―