Fiscal Year 2022 First Quarter Consolidated Financial Results (Japanese GAAP)May 12, 2022
Name of Listed Company: GMO Internet, 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, 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 13, 2022 Start Date of Dividend Payout: June 16, 2022
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 2022 (01.01.2022- 03.31.2022)(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%

Net Profit per
Share

Net Profit per Share(Diluted)¥ millions%¥ millions%

March 31, 2022
56,065-8.5
11,128 -10.8
12,099 -10.7
6,431
13.7
March 31, 2021
61,24614.1
12,47950.7
13,54368.1
5,656 150.7(Note) Comprehensive Income: March 31, 2022: 11,265 million (-13.3%), March 31, 2021: 12,988 million (374.1%)

Three months ended¥

March 31, 2022
March 31, 2021

¥

59.32
51.77

58.90
51.44

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

Net Assets¥ millions¥ millions%

March 31, 2022
1,487,484
141,619
4.7
December 31, 2021
1,418,936
140,402
5.2(Reference) Shareholders’ Equity: March 31, 2022: ¥70,415 million; December 31, 2021: ¥73,548 million
2. Dividends
Annual Dividends
End of Q1

Year Ended 12/2021
Year Ending 12/2022
Year Ending 12/2022 (forecast)End of Q2

End of Q3

End of Term

Total

¥

¥

¥

¥

¥

17.10
19.60

12.20

10.80

12.60

52.70

―

―

―

―

3. Consolidated Results Forecast for the Year Ending December 31, 2022 (01.01.2022 – 12.31.2022)

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., our subsidiary,
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, andoperating 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 12/2022

110,704,401

FYE 12/2021

111,893,046

2. Treasury shares at period end

Q1 FYE 12/2022

3,686,216

FYE 12/2021

2,283,361

3. Average number of shares during the period

Q1 FYE 12/2022

108,415,437

Q1 FYE 12/2021

109,252,032*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 12, 2022, 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 ............................................................................................................................... 9(3) Consolidated results forecast and other forward-looking information ................................................. 9
2. Quarterly Consolidated Financial Statements and Major Notes ............................................................. 10(1) Quarterly consolidated balance sheet ............................................................................................... 10(2) Quarterly consolidated statements of income and comprehensive income ...................................... 12(3) Notes regarding the quarterly consolidated financial statements ...................................................... 14
Notes regarding the going concern assumption ................................................................................ 14
Notes regarding changes impacting shareholders’ equity ................................................................. 14
Changes in accounting policies ......................................................................................................... 14
Segment information .......................................................................................................................... 16
Significant subsequent event ............................................................................................................. 17―1―

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

Overview of the Financial Results for the Three Months Ended March 31, 2022
(Unit: ¥millions)

Previous Q1

Current Q1

Change% Change

Net Sales

61,24656,065-5,181-8.5%

Operating Profit

12,47911,128-1,350-10.8%

Ordinary Profit

13,54312,099-1,443-10.7%

Profit Attributable to Owners of the Parent

5,656

6,431

774

13.7%

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, 2021, marking its 13th
straight yearly increase.
While the spread of COVID-19 has led to increased economic uncertainty in Japan, there is anincreasing need for services provided by the Group with the progress of Digital Transformation (DX)and the spread of stay-at-home and online consumption.
Amidst such a business environment, (1) the Internet Infrastructure segment, a collective of No. 1
products, showed steady growth supported by strong performance mainly in Payment and Security
partly due to the spread of online consumption. (2) The Online Advertising & Media segment enjoyedadvertising demand at year-end, and our own media also showed strong growth. (3) In the Internet
Finance segment, OTC FX faced a challenging environment in terms of profitability althoughtransaction volume increased due to increased volatility and consolidation of Gaika ex byGMO. On
the other hand, CFD showed strong growth as crude oil and commodity markets were highly volatile.
(4) The Cryptoassets segment showed sluggish growth compared to FY2021 Q1 which enjoyedactive trading, due to a significant decrease in transaction value caused by lower volatility.
As a result, for the three months ended March 31, 2022, the Company recorded net sales of¥56,065 million (down 8.5% year-on-year), operating profit of ¥11,128 million (down 10.8% year-onyear), ordinary profit of ¥12,099 million (down 10.7% year-on-year) and net profit attributable toowners of the parent of ¥6,431 million (up 13.7% year-on-year). The impact of applying theaccounting standard for revenue recognition was a decrease in net sales of ¥8,089 million and anincrease in operating profit of ¥0 million, and operating results under the previous accounting
standard would have been an increase in net sales and a decrease in profit from a year ago.

―2―

Net Sales and Operating Profit by Segment for the Three Months Ended March 31, 2022
(Unit: ¥millions)

Previous Q1

Current Q1

33,912
4,744

34,759
6,283

846
1,538

2.5%
32.4%

13,672
642

7,892
927

-5,779284-42.3%
44.4%

8,231
3,101

10,796
3,650

2,565
548

31.2%
17.7%

6,858
4,022

2,062
159

-4,795-3,862-69.9%-96.0%

222
74

536
252

314
177

141.2%
238.8%

318
-80

835
-90

516
-9

162.2%－-1,968
-25

-817
-53

1,151
-27

－
－

61,246
12,47956,065
11,128-5,181-1,350-8.5%-10.8%

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.
Effective January 1, 2022, in light of the future business development of our service using
authentication technologies to provide secure and safe Internet, including electronic authentication,
cyber security and trademark management, we changed the name of a sub-segment andrestructured segmentation. Namely, “Digital certificate and eSignature” was changed to “Security,”
and the brand security business previously included in “Domain” was transferred to “Security.”i. Domain
Positioned as a gateway to the Group’s infrastructure segment, the domain business has steadilygrown its customer base with a low-pricing strategy mainly through the Company and GMO Pepabo.
While the number of domain registration and renewals during the three months ended March 31,
2022 decreased to 1.28 million (down 7.3% year-on-year), the total number of domains undermanagement as of March 31, 2022 significantly increased to 7.28 million (up 11.3% year-on-year)
and strong overseas sales of .shop also contributed to earnings. As a result, net sales were ¥2,221
million (up 2.1% year-on-year).

―3―

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 of retail service, thenumber of web hosting contracts as of March 31, 2022 was 1,093 thousand (up 9.8% year-on-year)
and net sales were ¥4,484 million (up 14.7% 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
original merchandise production/sales service, and O2O support service. All services showed strong
performance partly due to the spread of stay-at-home and online consumption driven by the COVID19 pandemic. In EC platform, while the number of paid stores as of March 31, 2022 decreased 0.7%
year-on-year to 64 thousand, total transaction volume showed solid growth at ¥122.5 billion (up 7.9%
year-on-year) mainly in MakeShop which offers high-price plans. For minne, the total transaction
volume increased by 5.3% year-on-year to ¥4.1 billion through our efforts including issuing shopping
coupons and hosting a handmade contest. The effect of the change in accounting standard was adecrease in net sales of ¥702 million, and as a result, net sales were ¥3,559 million (down 11.7%
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 and brand security provided by GMO BRAND
SECURITY Inc. SSL server certificate service returned to a normal growth trend with the effect of theshortened certificate lifespan from two years to one year to improve security fully subsided by thethree months ended September 30, 2021. e-contract service GMO Sign has steadily expanded its
customer base and increased the number of transmission. As a result, this sub-segment reported net
sales of ¥2,534 million (up 27.5% year-on-year).
v. Payment
Payment services are mainly operated by GMO Payment Gateway and offer comprehensive
payment-related service and finance-related services. In the payment-related service, despite theeffect of the COVID-19 pandemic, online/recurring payments in the Ecommerce market and cashless
payments continued to expand and the number of stores using a next-generation payment platform“stera” terminal in the face-to-face payments also showed a favorable growth. In finance-related
services, a deferred payment service “GMO Payment After Delivery” showed favorable growth. As aresult, the number of transactions and the transaction volume increased, and net sales increased to¥12,025 million (up 17.4% year-on-year).
vi. Provider
In this sub-segment, the Company offers Internet provider services for consumers. The number ofsubscriptions on March 31, 2022, was 2.24 million (up 1.8% year-on-year) due to strong growth in
the fixed-line service despite weak growth in mobile line service. The effect of the change inaccounting standard was a decrease in net sales of ¥1,018 million, and as a result, net sales were
¥9,420 million (down 12.2% year-on-year).
Overall, the Internet Infrastructure segment recorded net sales of ¥34,759 million (up 2.5% year-onyear) and operating profit of ¥6,283 million (up 32.4% year-on-year). The effect of applying the
Accounting Standard for Revenue Recognition was the decreases in net sales and operating profit of¥2,285 million and ¥42 million, respectively, and operating results under the previous accounting
standard would have been increases in both net sales and operating profit, hitting a quarterly record
high.

―4―

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. In the advertising agency
service, transactions with customers in certain industries and business type continued to growsteadily thanks to an increase in advertising demand at year-end. On the other hand, in-house ad
network products such as AkaNe, an ad network for smartphones, and ReeMo, an ad distribution
platform (DSP) specialized in collecting users most likely to be interested in the contents, showedsluggish growth due to the impact from the stricter advertising review criteria. The effect of thechange in accounting standard was a decrease in net sales of ¥5,497 million, and as a result, net
sales amounted to ¥3,831 million (down 60.5% 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. Advertising revenue increased due to a favorable unit
price movement and increased pageviews. The effect of the change in accounting standard was adecrease in net sales of ¥1,232 million, and as a result, net sales were ¥2,707 million (down 10.5%
year-on-year).
Overall, the Online Advertising & Media segment recorded net sales of ¥7,892 million (down 42.3%
year-on-year), and operating profit of ¥927 million (up 44.4% year-on-year). The effect of applying the
Accounting Standard for Revenue Recognition was a decrease in net sales of ¥6,730 million and anincrease in operating profit of ¥42 million, and operating results under the previous accounting
standard would have been increases in both net sales and operating profit, hitting a quarterly recordhigh.
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 base
expanded, with the number of OTC FX accounts increasing to 1,384 thousand (up 50.6% year-onyear) partly due to consolidation of Gaika ex byGMO and the number of securities accounts
increasing to 487 thousand (up 5.1% year-on-year). The OTC FX posted an increase in net sales
with contribution from Gaika ex byGMO despite an increase in cover transaction cost associated with
rapid yen weakening against the U.S. dollar. CFD showed favorable growth thanks to highly volatilecrude oil and commodity markets. The securities business in Thailand also continued to show steady
growth.
Overall, the Internet Finance segment recorded net sales of ¥10,796 million (up 31.2% year-on-year)
and operating profit of ¥3,650 million (up 17.7% year-on-year).
4) Cryptoassets
The Cryptoassets segment operates businesses pertaining to “mining” and “exchange” of cryptoassets.
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 ¥856 million (down 38.1% 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, 2022 increasing to 500 thousand―5―

(up 33.7% year-on-year). We also added new altcoins to our service, becoming the leading company
in Japan in terms of the number of types of cryptocurrencies handled in January 2022. On the other
hand, net sales showed sluggish growth compared to FY2021 Q1 which enjoyed active trading, due
to a significant decrease in transaction value caused by lower volatility. As a result, net sales
decreased to ¥1,078 million (down 80.3% year-on-year).
Overall, the Cryptoassets segment reported year-on-year decreases in both net sales andoperating profit at ¥2,062 million (down 69.9% year-on-year) and ¥159 million (down 96.0% year-onyear), respectively.
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 ¥536 million (up 141.2% year-on-year), and operating
profit was ¥252 million (up 238.8% year-on-year) due to sales of shareholdings.
(Reference1)

Changes in Operating Results and Financial Condition by Quarter

Net sales
Operating profit
Ordinary profit
Profit attributableto owners of the parent
Total assets
Shareholders’ equity(Unit: ¥millions)Q1 202256,065
11,12812,099Q1 2021
61,246
12,47913,543Q2 2021
59,233
10,141
10,076

Q3 202156,4718,012
8,601

Q4 202164,494
10,464
11,171

5,656

4,046

3,597

4,227

6,431

1,170,590
62,546

1,134,787
70,7001,369,409
73,094

1,418,936
73,5481,487,484
70,415―6―

(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 2021
Q1 2022

Q1 2021

Q2 2021

Q3 2021

10,728
2,175
3,909
4,032
1,988
10,239838
33,912

10,593
2,179
3,946
4,195
2,050
10,979716
34,661

10,002
2,132
4,107
4,197
1,978
11,323593
34,335

9,825
2,188
4,226
4,262
2,599
12,013736
35,852

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

9,688
3,026
957
13,672

8,328
3,526
886
12,741

7,759
3,302
996
12,058

8,602
3,788
1,208
13,599

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

8,231

6,913

7,386

11,368

10,796

5,474
1,383
－
6,858

4,142
1,537
42
5,723

2,023
1,653
0
3,677

1,740
1,864
770
4,375

1,078
856
127
2,062

222
62,896318-1,96861,246675
60,715439-1,92059,23364
57,523437-1,48956,471607
65,804396-1,70564,494536
56,047835-817
56,065

Q1 2021
4,744
642
3,101
4,022
74
12,585-80-25
12,479Q2 2021
4,936
429
2,129
2,347
432
10,274-105-28
10,141Q3 2021
4,021
251
2,628
1,482
-33
8,350
-197
-141
8,012

Q4 2021
5,530
-136
3,856
1,241
311
10,803-239-99
10,464

Q1 2022
6,283
927
3,650
159
252
11,272-90-53
11,128II Operating Profit by Segment
Internet Infrastructure
Online Advertising & MediaInternet Finance
Cryptoassets
Incubation
Sub total
Other
Adjustment
Operating Profit―7―

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

Ecommerce
solutionsInternet
Infrastructure

Security

Payment

OnlineAdvertising &Media

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
online research panel including GMO Research Cloud PanelInternet FinanceInternet finance

Cryptoassets

Cryptoassets
exchange
Cryptoassets
miningCryptoassets
payment

Incubation

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・SaaS based services for online store building including Color me shopand operation of EC platform to set up net shop offered by 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”
・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

Venture capital・Operation of online securities trading, FX trading, CFD trading, etc.
・Spot trading and leveraged transactions of cryptoassets, etc.
・Operation of mining centers
・Issuance and redemption of stablecoin “GYEN” and “ZUSD”
・Investment in private Internet startups―8―

(2) Financial condition
Assets, Liabilities and Net Assets
Assets
As of March 31, 2022, total assets increased ¥68,548 million from December 31, 2021 to ¥1,487,484
million. Major factors included an increase of ¥48,921 million in cash and deposits, an increase of¥6,387 million in cryptoassets under custody and an increase of ¥5,933 million in various assets due
to fluctuations in customer assets in the Securities segment (deposits, margin transaction assets,loan secured by securities, short-term guarantee deposits and variation margin paid).
Liabilities
As of March 31, 2022, liabilities increased ¥67,331 million from December 31, 2021 to ¥1,345,865
million. Major factors included an increase of ¥41,134 million in debt, an increase of ¥6,294 million in
deposits received for cryptoassets and an increase of ¥25,455 million in various liabilities due tofluctuations in customer assets in the Securities segment (deposits received, margin transaction
liability, guarantees received, variation margin received, and loans payable secured by securities).
Net Assets
As of March 31, 2022, net assets increased ¥1,216 million from December 31, 2021 to ¥141,619
million. Major factors included an increase of ¥281 million in earned surplus (consisting of anincrease from recording profit attributable to owners of the parent totaling ¥6,431 million, a decrease
from dividend payments of ¥1,381 million, a decrease from retirement of treasury stock of ¥2,352
million and a decrease of ¥2,416 million in the beginning balance of earned surplus as a result of
application of Accounting Standard for Revenue Recognition), an increase of ¥4,364 million in noncontrolling interests, a decrease of ¥3,854 million due to acquisition and retirement of treasury stock
and an increase of ¥1,041 million in foreign currency translation adjustments.
(3) Consolidated results forecast and other forward-looking information
For the fiscal year ending December 31, 2022, 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, 2022.

―9―2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheet
Previous Fiscal Year(As of Dec 31, 2021)(Unit: ¥millions)
1st Quarter
Current Fiscal Year(As of Mar 31, 2022)

AssetsCurrent Assets
Cash and deposits

240,136

289,057

Trade notes and accounts receivable

27,382－－33,724

Trade notes, accounts receivable and contract
assets

8,449

8,009

Cryptoassets under custody

115,973

122,360

Securities segment deposits

478,489484,695

Securities segment margin transaction assets

134,732

124,723

Securities segment loan secured by securities

9,626

14,681

Securities segment short term guarantee deposits

67,862

66,240Operational investment securities

Securities segment variation margin paid

70,512

76,815

Other

143,655

137,987-3,835-4,061

1,292,984

1,354,234

44,78844,796
21,788Provision for doubtful debts
Total Current Assets
Fixed Assets
Tangible fixed assets
Intangible fixed assets
Goodwill

14,251

Software

10,181

11,030Other

15,132

14,590Total intangible fixed assets

39,56647,408Investments and other assets
28,60528,268Deferred tax asset

2,328

4,096

Other

11,362

9,378

Investment securities

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

―10―

-699

-699

41,59741,044125,952

133,250

1,418,936

1,487,484

Previous Fiscal Year(As of Dec 31, 2021)(Unit: ¥millions)
1st Quarter
Current Fiscal Year(As of Mar 31, 2022)

Liabilities
Current Liabilities
Trade notes and accounts payable

11,921

12,302

Short term debt

172,995

215,489

Amount payable

45,22838,599Deposits received for cryptoassets

116,161

122,456

Securities segment deposits received

55,39250,186

Securities segment margin transaction liability

30,554

37,124

Securities segment guarantees received

519,131522,603

Securities segment variation margin received

7,677

10,739Securities segment loans payable secured by securities

20,614

38,170Accrued corporate tax, etc.

4,731

5,104

Allowance for bonuses

2,948

1,840

Allowance for bonuses to directors

1,452

517

Advance payment received

11,082－Contract liabilities－

20,308Deposits received

110,817

110,042

Other

34,272

27,877

1,144,982

1,213,362

Corporate bonds

45,00045,000Convertible bonds with equity warrants

20,99020,935Long term debt

55,67854,319Deferred tax liability

1,568

1,762

Other

9,390

9,560

132,627

131,576

924

926

Total Current Liabilities
Fixed Liabilities

Total Fixed Liabilities
Statutory Reserve
Financial instruments transaction liability reserve

924

926

1,278,533

1,345,865

Capital stock

5,000

5,000

Capital surplus

34,32833,725

Earned surplus

35,75636,038Treasury stock-5,684-9,538

Total Shareholders’ Equity

69,40065,225

3,559

3,560

588

1,629

4,147

5,189

Total Statutory Reserve
Total Liabilities
Net Assets
Shareholders’ Equity

Accumulated Other Comprehensive Income
Other securities valuation differences
Foreign currency translation adjustments
Total Accumulated Other Comprehensive Income
Equity Warrants
Non-controlling Interests
Total Net Assets
Liabilities, Net Assets Total

―11―

52

37

66,802

71,166140,402141,619

1,418,936

1,487,484

(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 2021)
61,246

1st Quarter
Current Fiscal Year
(3 months to March 2022)
56,065

Cost of Sales

28,30921,788Gross Profit on Sales

32,93734,276

Sales, General & Administrative Expenses

20,45823,148Operating Profit

12,47911,128Net Sales

Non Operating Revenue
Dividends received

160

299

Foreign exchange gain

988

789

Gain on investments in partnership

83

61

Other

209

207

1,442

1,358

Interest paid

111

177

Equity method investment losses

217

154

Other

49

55

Total Non Operating Expenses

377

387

13,54312,099Gain from business transfer

46－

Gain on sale of investment securities

－

2,489

Reversal of financial instruments transaction
liability reserve

32－

Total Non Operating Revenue
Non Operating Expenses

Ordinary Profit
Extraordinary Profit

Other

6

11

Total Extraordinary Profit

85

2,501

Provision of financial instruments transaction
liability reserve－2

Loss on disposal of fixed assets

83Extraordinary Loss

8

5

Net Profit before Adjustment for Tax, etc.

13,62014,596

Corporate, Municipal and Enterprise Taxes

4,348

4,320

540

-329

Total Extraordinary Loss

Corporate Tax etc. Adjustment
Total Corporate Taxes, etc.

4,889

3,991

Net Profit

8,731

10,604

Profit attributable to Non-controlling Interests

3,074

4,173

Profit attributable to Owners of the Parent

5,656

6,431

―12―

Quarterly consolidated statement of comprehensive income
1st Quarter(Unit: ¥millions)

Net Profit

1st Quarter
Previous Fiscal Year
(3 months to March 2021)
8,731

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

3,428

-954

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

36－

Foreign currency translation adjustments

905

1,572

Share of other comprehensive income (loss) of associates
accounted for using equity method

-113

42

4,257

661

12,988

11,265Comprehensive income attributable to owners of the parent

9,383

7,473

Comprehensive income attributable to non-controlling interests

3,605

3,792

Total other comprehensive income
Comprehensive Income(Breakdown)―13―(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 resolutions at the Board of Directors meetings held on February 12, 2021 andFebruary 10, 2022, the Company acquired 1,287,200 shares of treasury stock for ¥3,261 million and
1,304,300 shares of treasury stock for ¥3,625 million, respectively.
Also, pursuant to the resolution at the Board of Directors meeting held on February 10, 2022, theCompany retired 1,188,645 shares, which resulted in decreases in capital reserve, earned surplus,
and treasury stock of ¥680 million, ¥2,352 million, and ¥3,032 million, respectively.
As a result, capital reserve, earned surplus, and treasury stock as of March 31, 2022, were ¥33,725
million, ¥36,038 million, and ¥9,538 million, respectively.
(Changes in accounting policies)(Adoption of the Accounting Standard for Revenue Recognition, etc.)
On January 1, 2022, the Company applied “Accounting Standard for Revenue Recognition”(Accounting Standards Board of Japan (“ASBJ”) Statement No.29, March 31, 2020, “AccountingStandard for Revenue Recognition”), etc., and recognizes revenue at an amount that it expects toreceive in exchange for the promised goods or services when the control of the goods or services istransferred to a customer.
Accordingly, we identified performance obligations in the contracts with customers and changed themethod to recognize certain initial cost revenue in the Internet Infrastructure segment from recognizingat the commencement of service to recognizing over the service contract period. In addition, themethod to recognize revenue for services which the Group is deemed to have provided as an agent
was changed from recognizing at gross amount to recognizing at net amount.
We applied the Accounting Standard for Revenue Recognition, etc. from January 1, 2022 pursuant
to the transitional treatment provided for in the proviso of Paragraph 84 of the Accounting Standard for
Revenue Recognition, with the cumulative effect of the retrospective application, assuming the new
accounting policy had been applied to periods prior to January 1, 2022, adjusted to the beginningbalance of earned surplus as of January 1, 2022.
As a result, net sales for the three months ended March 31, 2022, decreased by ¥8,089 million, costof sales decreased by ¥7,260 million, sales, general and administrative expenses decreased by ¥828
million, and operating profit, ordinary profit, and net profit before adjustment for tax, etc. increased by¥0 million, respectively. Also, the beginning balance of earned surplus decreased by ¥2,416 million.
As a result of the application of the Accounting Standard for Revenue Recognition, etc., “Trade notes
and accounts receivable” which was presented in “Current Assets” on the consolidated balance sheet
as of December 31, 2021, is included in “Trade notes, accounts receivable and contract assets” fromJanuary 1, 2022. Also, “Advance payment received” which was presented in “Current liabilities” and"Unearned revenues" that were presented as “Other” in "Current liabilities" are included in “Contract
liabilities” from January 1, 2022.
Pursuant to the transitional treatment stipulated by Paragraph 89-2 of the Accounting Standard for
Revenue Recognition, the Group did not reclassify figures for the year ended December 31, 2021 toconform to the new presentation method. Also, pursuant to the transitional treatment provided for in
Paragraph 28-15 of the “Accounting Standard for Quarterly Financial Reporting” (ASBJ Statement No.
12, March 31, 2020), information on the breakdown of revenue arising from contracts with customers
for the three months ended March 31, 2021 is not presented.
(Application of Accounting Standard for Fair Value Measurement, etc.)
The Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019,
hereinafter the “Fair Value Measurement Accounting Standard”), etc. has been applied from the―14―

beginning of the first quarter. Accordingly, the new accounting policies specified in the Fair Value
Accounting Standard, etc. are applied into the future according to the transitional measures prescribedin the paragraph 19 of the Fair Value Measurement Accounting Standard and the paragraph 44-2 ofthe Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019). There will
be no material impact on Quarterly Consolidated Financial Statements.

―15―

(Segment Information)
I 1st Quarter of Previous Fiscal Year (01.01.2021-03.31.2021)
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

Sales to unaffiliatedcustomers

33,66912,015

8,231

6,858

222

60,997249－

61,246

Internal transactions
or transfer

242

1,656

－

－

－

1,899

68

-1,968－

Total

33,912

13,672

8,231

6,858

222

62,896318-1,96861,246

Segment Profit/Loss

4,744

642

3,101

4,022

74

12,585-80-25

12,479Cryptoassets Incubation

Total

Net Sales*Notesi. “Other” represents mobile entertainment and other businesses not included in reportable segments.
ii. Segment profit/loss adjustment (¥-25 million) is an elimination of inter-segment transactions.
iii. Segment profit/loss is based on operating profit in the quarterly consolidated statement of income.
II 1st Quarter of Current 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

Sales to unaffiliatedcustomers

34,4897,432

10,791

2,062

536

55,312752－

56,065Internal transactions
or transfer

269

460

5

－

－

734

82

-817

－

Total

34,759

7,892

10,7962,062

536

56,047835-817

56,065

Segment Profit/Loss

6,283

927

3,650

159

252

11,272-90-53

11,128Cryptoassets Incubation

Total

Net Sales*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 inter-segment transactions.
iii. Segment profit/loss is based on operating profit in the quarterly consolidated statement of income.
2. Information on changes in reportable segments, etc.
As described in Changes in accounting policies, following the application of the AccountingStandard for Revenue Recognition, etc. on January 1, 2022, the Group changed the accounting
treatment for revenue recognition and also the method to measure segment profit (loss) accordingly.
Compared to the previous method, in the Internet Infrastructure segment, net sales and segment
profit decreased by ¥2,285 million and ¥42 million, respectively; in the Online Advertising & Media
segment, net sales decreased by ¥6,730 million and segment profit increased by 42 million; and in
the Internet Finance segment, net sales decreased by ¥5 million and there was no impact on segment
profit. There was no impact on the Cryptoassets and Incubation segments. Internal transactions ortransfer in "Adjustment" decreased by ¥931 million, which did not affect the segment profit.

―16―

3. Information on impairment losses on fixed assets 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 ¥7,724 million.
The amount of goodwill is a provisionally calculated amount as the allocation of acquisition cost has
not been completed.
(Significant subsequent event)(Change in a company accounted for using the equity method)
At the Board of Directors meeting held on April 18, 2022, our consolidated subsidiary GMO
Payment Gateway, Inc. ("GMO-PG”) resolved to transfer all of the shares of its equity method affiliate
2C2P Pte. Ltd. (“2C2P”) held by GMO-Z.COM PAYMENT GATEWAY PTE. LTD. (GMO-Z PG SG), a
consolidated subsidiary of GMO-PG.
As a result of the share transfer, 2C2P will be excluded from equity method affiliates.
(1) Reasons for the Transfer of Shares
In order to expand the payment processing business in the Asian region, GMO-PG acquired
shares of 2C2P, a company providing payment processing business mainly in Thailand, throughthe consolidated subsidiary GMO-Z PG SG and made 2C2P an equity method affiliate in August
2016. 2C2P has steadily improved its business performance in Southeast Asia, and GMO-PG
has recently received an offer from a global payment processing company based in China toacquire the shares owned in 2C2P.
GMO-PG has agreed to the sale and executed an agreement for the transfer of shares basedon the decision that the transfer would be beneficial for the future growth of GMO-PG as well as
2C2P and by taking a comprehensive view that the price of the share transfer is valid andreasonable, and that the acquiror’s policy is to further enhance 2C2P by making it a subsidiary.
The transfer of shares will be completed once all the preconditions and terms are fulfilled(estimated timing of closure is June 2022).
GMO-PG will continue its policy to expand the Payment Processing Business and the Money
Service Business overseas, particularly in Southeast Asia. The funds received from the sharetransfer will strengthen the financial soundness of GMO-PG as well as be used for growthinvestments including overseas lending operations in order to further our efforts to achievesustainable growth and enhance the corporate value.
(2) Name of the equity method affiliate to be transferred
2C2P Pte. Ltd.
(3) Timing of the transfer
June 2022 (plan)(4) Name of the counterparty in the share transfer
ADVANCED NEW TECHNOLOGIES (SINGAPORE) HOLDING PTE.LTD.
(5) Number of shares to be transferred and the percentage of shareholding before and after thetransfer
Shares owned before
the change
Number of shares to betransferred

3,292,272 shares(ownership of voting rights: 29.34％)

3,292,272 shares

Shares owned after the

0 shares (ownership of voting rights: 0％)transfer(Note): The amount of the transfer price is not disclosed due to non-disclosure obligations agreed
to between the parties. Note that the transfer price will not be identical to the amount calculatedby dividing the gain on sale from share transfer with the ownership proportion of voting rights.
(6) Outlook
Due to the transfer of shares, the fiscal year ending December 2022 is estimated to record a―17―

gain on sales of investments in securities of ¥17.0bn. Part of the transfer value is stored in an
escrow account as set forth in the share transfer agreement, and the Company expects to post
a gain on sale, etc. of approximately ¥1.0bn by the fiscal year ending December 2024, whenconditions are met.
Note that the transfer price, etc. are estimates as of this writing and the actual amounts mayvary. The foreign exchange rate assumed is 1 USD = 122.41JPY (as of March 31, 2022).

―18―