Fiscal Year 2023 Third Quarter Consolidated Financial Results (Japanese GAAP)
November 14, 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: November 14, 2023
Start Date of Dividend Payout: December 18, 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. Third Quarter Financial Results in the Year Ending December 2023 (01.01.2023- 09.30.2023)(1) Consolidated Operating Results (cumulative)(percentages shown represent year-on-year % change)
Profit Attributable to
Net Sales
Operating Profit
Ordinary Profit
Owners of the
ParentNine months ended¥ millions%¥ millions%¥ millions%¥ millions%

September 30, 2023
September 30, 2022

192,545
183,134

5.1
3.5

30,08538,010-20.8
24.1

32,24442,438

-24.0
31.7

9,633
13,854-30.5
4.2(Note) Comprehensive Income: September 30, 2023: 27,877 million (-37.8%), September 30, 2022: 44,790 million (74.4%)

Net Profit per
Share
Nine months ended

September 30, 2023
September 30, 2022

Net Profit per Share(Diluted)

¥

¥

90.42
129.0389.72
127.89(2) Consolidated Financial Condition
Total Assets

Shareholders’ Equity
Ratio

Net Assets

As of¥ millions¥ millions%

September 30, 2023
December 31, 2022

1,706,559
1,542,740

174,833
154,688

4.8
4.7(Reference) Shareholders’ Equity: September 30, 2023: ¥81,804 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
7.50

0.00
10.20

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 in significant subsidiaries in the current term: Yes(Change in specific subsidiaries resulting in a change in scope of consolidation)
Exclusion: 1 (GMO-Z.com Bullion HK Limited)(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)

Q3 FYE 12/2023

110,113,337

FYE 12/2022

110,704,401

2. Treasury shares at period end

Q3 FYE 12/2023

3,951,867

FYE 12/2022

3,979,562

3. Average number of shares during the period

Q3 FYE 12/2023

106,528,121

Q3 FYE 12/2022

107,368,801*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 November 14, 2023, we plan to stream a financial results briefing live. The presentation andexplanation (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
Additional information .................................................................................................................. 14
Segment information ................................................................................................................... 15
Significant subsequent event....................................................................................................... 16―1―

1. Qualitative Information Related to Financial Results(1) Operating results◆ Overview of the Financial Results for the Nine Months Ended September 30, 2023
(Unit: ¥millions)

Previous Q3

Current Q3

Change% Change

Net Sales

183,134

192,545

9,410

5.1%

Operating Profit

38,01030,085-7,924-20.8%

Ordinary Profit

42,43832,244-10,194-24.0%

Profit Attributable to Owners of the Parent

13,854

9,633-4,221-30.5%

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 been becoming an irreversible trend and there is an increasing need forservices provided by the Group.
Amidst such a business environment, (1) in the Internet Infrastructure segment, a collective of No.1
services, Payment continued to show steady growth, mainly in the face-to-face payments. (2) In theOnline Advertising & Media segment, while our own media maintains high pageviews, revenue
decreased mainly due to a noticeable trend of advertising budget reduction in specific industries. (3)In the Internet Finance segment, OTC FX showed strong growth thanks to the profitability
improvement measures, and CFD also showed strong growth mainly due to cross-selling measuresleading to increased transactions. (4) The Cryptoassets segment continues to post operating loss
due to continuing sluggish trading in the overall cryptoasset market despite the cost reduction efforts.
As a result, for the nine months ended September 30, 2023, the Company recorded net sales of¥192,545 million (up 5.1% year-on-year), operating profit of ¥30,085 million (down 20.8% year-onyear), ordinary profit of ¥32,244 million (down 24.0% year-on-year) and net profit attributable toowners of the parent of ¥9,633 million (down 30.5% year-on-year), an increase in net sales but adecrease in profit due to an absence of profit contribution from sales of stocks in the Incubation
segment which was reported a year ago.

―2―

Net Sales and Operating Profit by Segment for the Nine Months Ended September 30, 2023
(Unit: ¥millions)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

Previous Q3

Current Q3

Change% Change

109,499
16,622

127,188
19,131

17,688
2,508

16.2%
15.1%

25,291
2,212

25,926
1,511

634
-700

2.5%
-31.7%

31,162
9,309

35,597
11,202

4,434
1,892

14.2%
20.3%

4,133
-1,0593,120-1,355-1,013-295-24.5%－

13,392
10,318690-0-12,702-10,318-94.8%
－

2,604
-179

3,458
-338

854
-159

32.8%
－

-2,949786-3,436
-65

-486
-851

－
－

183,134
38,010

192,545
30,0859,410-7,9245.1%-20.8%◆Overview of Financial Results for the Three Months ended September 30, 2023
(Unit: ¥millions)

Net Sales
Operating Profit
Ordinary Profit
Profit attributable to Owners of
the Parent

Previous Q3
57,578
7,069
8,955

Current Q362,5019,466
9,707-1,651

3,288

Change% Change
4,922
8.5%
2,397
33.9%
751
8.4%
4,940

－

During the three months ended September 30, 2023, the Internet Infrastructure segment showedsolid growth driven by Payment and Security services. The Online Advertising & Media segment
showed sluggish growth due to a trend of advertising budget reduction in specific industries while ourown media maintained a desirable level of pageviews. The Internet Finance segment continued toreport strong profit as profitability significantly improved thanks to the enhanced profitability
improvement measures despite a decline in market volatility in OTC FX. The cryptoassets segment
continued to experience a severe environment due to continued sluggish transaction volume.

―3―

Net Sales and Operating Profit by Segment for the Three Months ended September 30, 2023
(Unit: ¥millions)
Previous Q3

Current Q3

Change% Change

38,074
4,753

42,478
6,129

4,404
1,376

11.6%
29.0%

8,886
737

8,587
485

-299
-251

-3.4%
-34.2%

10,002
2,683

10,539
3,605

537
921

5.4%
34.3%

775
-821

958
-532

183
289

23.6%
－

0
-96

38
-112

38
-16

－
－

903
-85

1,036
-123

133
-37

14.8%
－

-1,063-101-1,138
14

-75
115

－
－

57,578
7,069

62,501
9,466

4,922
2,397

8.5%
33.9%

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

Segments results for the three months ended September 30, 2023 are as follows.
1) 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 has steadilygrown 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 September 30, 2023
increased to 1.95 million (up 49.6% year-on-year), the total number of domains under management
as of September 30, 2023 increased to 8.17 million (up 16.1% year-on-year) and large domain sales
contributed to a sales increase, and as a result, net sales were ¥2,470 million (up 3.8% 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 September 30, 2023 was 1,124 thousand (up 2.5% yearon-year) and net sales were ¥5,158 million (up 9.9% year-on-year).

―4―

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. In EC platform, the totaltransaction volume was ¥114.8 billion (down 1.9% year-on-year) due to a decrease in the number ofpaid stores as of September 30, 2023 to 52 thousand (down 10.2% year-on-year) and a reactionary
decline in the stay-at-home consumption despite an increase in the number of users of the free planof Color me shop that allows to open an online store without a monthly fee. For Minne, the totaltransaction volume decreased by 16.5% year-on-year to ¥2.8 billion due to a decline in the circulation
volume of low-priced products. Meanwhile, Makeshop which offers high-priced plans showed stable
growth. As a result, net sales were ¥4,144 million (up 7.7% 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, cybersecurity provided by GMO Cybersecurity
by Ierae, and brand security provided by GMO BRAND SECURITY Inc. e-contract service GMO Sign
showed steady growth in the number of contracts with large increases in the number of customers
and contract transmission. As a result, this sub-segment reported net sales of ¥3,955 million (up20.4% 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, the number oftransactions and the transaction volume showed favorable growth due to steady expansion of the
Ecommerce market in online/recurring payments and an increase in the number of stores using thenext-generation payment platform “stera” terminal in the face-to-face payments. As a result, net sales
increased to ¥15,876 million (up 21.1% year-on-year).
vi. Provider
In this sub-segment, the Company offers Internet provider services for consumers. The number ofsubscriptions at September 30, 2023 was 2.26 million (up 0.5% year-on-year) and net sales were
¥10,020 million (up 0.1% year-on-year) due to stable growth in the fixed line service.
Overall, the Internet Infrastructure segment recorded net sales of ¥42,478 million (up 11.6% year-onyear) and operating profit of ¥6,129 million (up 29.0% year-on-year).
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. Net sales were ¥4,108 million(down 19.1% year-on-year) due to a trend of advertising budget reduction in specific industries.
ii. Internet media
This sub-segment provides advertising space through operation of our own media and the marketing
support services mainly through GMO Media. Net sales were ¥3,272 million (up 25.9% year-on-year)
mainly due to a continuing strong growth in pageviews in our own media.
Overall, the Online Advertising & Media segment recorded net sales of ¥8,587 million (down 3.4%
year-on-year) and operating profit of ¥485 million (down 34.2% year-on-year).

―5―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 as of September 30, 2023 increasing to
1,475 thousand (up 4.5% year-on-year) and the number of securities accounts increasing to 520
thousand (up 4.1% year-on-year). In OTC FX, the transaction volume decreased year-on-year due toa decline in market volatility, but profitability significantly improved. CFD reported favorable growth
due to active movements in commodity indexes and positive effects of the cross-selling measures.
Overall, the Internet Finance segment recorded net sales of ¥10,539 million (up 5.4% year-on-year)
and operating profit of ¥3,605 million (up 34.3% year-on-year) due to a reversal of provision for
doubtful debts of approximately ¥0.5 billion related to the securities business in Thailand.
4) Cryptoassets
The Cryptoassets segment operates businesses pertaining to “mining,” “exchange” and “payment” ofcryptoassets. Performance of each business is as follows.
i. Cryptoassets mining
The Cryptoassets mining business runs mining centers. Profitability decreased year-on-year due toexternal factors including increased hash rates, and net sales amounted to ¥88 million (down 63.2%
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 September 30, 2023 increasing to 586
thousand (up 9.1% year-on-year). Meanwhile, the trading value decreased due to the sluggish trends
in the cryptoasset market. As a result, net sales amounted to ¥819 million (up 55.3% year-on-year).
Overall, the Cryptoassets segment reported net sales of ¥958 million (up 23.6% year-on-year) andoperating loss of ¥532 million (operating loss of ¥821 million for the three months ended September
30, 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 ¥38 million (net sales were ¥0 million for the threemonths ended September 30, 2022), and operating loss was ¥112 million (operating loss of ¥96
million for the three months ended September 30, 2022) 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(- represents loss)
Total assets
Shareholders’ equity(Unit: ¥millions)Q3 2023
62,5019,466
9,707

Q3 202257,5787,069
8,955

Q4 202262,5615,736
3,586

Q1 2023
65,593
10,99011,933Q2 2023
64,4509,627
10,603-1,651

-644

3,931

2,412

3,288

1,545,403
74,209

1,542,740
72,176

1,624,445
75,4391,669,248
79,3691,706,559
81,804―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)
Q2 2023
Q3 2023

Q3 2022

Q4 2022

Q1 2023

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

10,191
2,388
5,048
4,046
3,573
16,302996
42,54810,020
2,470
5,158
4,144
3,955
15,876852
42,478

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

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

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

4,512
2,792
1,130
8,435

4,108
3,272
1,207
8,587

10,002

11,38912,792

12,265

10,539

527
241
6
775

1,654
270
154
2,079

921
278
2
1,202

789
169
0
958

819
88
50
958

0
57,738903-1,06357,578062,783958-1,18162,561

195
65,255
1,447-1,11065,593456
64,664973-1,18764,45038
62,602
1,036-1,13862,501Q3 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
10,990Q2 2023
6,007
358
3,834
-484
3
9,719
-92
0
9,627

Q3 2023
6,129
485
3,605
-532
-112
9,576
-123
14
9,466

II 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

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, Cloud VPS by GMO,
ALTUS by GMO, 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, Sokkyu by GMO 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”―8―

(2) Financial condition<Assets, Liabilities and Net Assets>(Assets)
As of September 30, 2023, total assets increased ¥163,818 million from December 31, 2022 to¥1,706,559 million. Major factors included an increase of ¥17,848 million in cash and deposits, anincrease of ¥47,389 million in cryptoassets under custody, and an increase of ¥56,680 million invarious assets due to fluctuations in customer assets in the Securities segment (deposits, margintransaction assets, loan secured by securities, short-term guarantee deposits and variation marginpaid).
(Liabilities)
As of September 30, 2023, liabilities increased ¥143,673 million from December 31, 2022 to¥1,531,725 million. Major factors included an increase of ¥30,859 million in debt, an increase of¥41,700 million in corporate bonds, an increase of ¥47,415 million in deposits received for
cryptoassets, an increase of ¥45,417 million in various liabilities due to fluctuations in customer
assets in the Securities segment (deposits received, margin transaction liability, guarantees received,
variation margin received, and loans payable secured by securities), a decrease of ¥21,788 million in
deposits received, and a decrease of ¥6,341 million in allowance for contract loss due to deduction
from acquisition cost of class shares of GMO Aozora Net Bank, Ltd.
(Net Assets)
As of September 30, 2023, net assets increased ¥20,144 million from December 31, 2022 to¥174,833 million. Major factors included an increase of ¥6,023 million in earned surplus (consistingof an increase from recording profit attributable to owners of the parent totaling ¥9,633 million, adecrease from dividend payments of ¥2,099 million and a decrease from retirement of treasury stockof ¥1,510 million), an increase of ¥2,814 million in foreign currency translation adjustments and anincrease of ¥10,507 million in non-controlling interests.

(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.

―9―2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly consolidated balance sheet
Previous Fiscal Year(As of Dec 31, 2022)(Unit: ¥millions)
3rd Quarter
Current Fiscal Year(As of September 30,
2023)

AssetsCurrent Assets
Cash and deposits

341,970

359,819

Trade notes, accounts receivable and contract
assets33,96332,438Operational investment securities

11,724

13,300

Cryptoassets under custody

61,751109,141

Securities segment deposits

486,478

523,518

Securities segment margin transaction assets

143,065

144,412Securities segment loan secured by securities

12,695

14,487

Securities segment short-term guarantee deposits

73,97577,310

Securities segment variation margin paid

94,219107,386

Other

156,759

185,074

Provision for doubtful debts
Total Current Assets-8,590-6,351

1,408,015

1,560,537

45,82546,062

Fixed Assets
Tangible fixed assets
Intangible fixed assets
Goodwill

17,70816,242

Software11,472

12,726

Other

16,756

16,566

Total intangible fixed assets

45,93645,535Investment securities

29,78038,545

Deferred tax asset

4,053

4,146

Other

9,791

19,058Investments and other assets

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

―10―

-662

-7,32742,96354,422

134,725

146,021

1,542,740

1,706,559

Previous Fiscal Year(As of Dec 31, 2022)(Unit: ¥millions)
3rd Quarter
Current Fiscal Year(As of September 30,
2023)

Liabilities
Current Liabilities
Trade notes and accounts payable

14,43013,496

Short-term debt

222,018

208,220－

10,200Current portion of bonds
Amount payable

47,07541,481

Deposits received for cryptoassets

61,734

109,149

Securities segment deposits received

53,57359,511

Securities segment margin transaction liability

35,92940,479Securities segment guarantees received

554,407569,675

Securities segment variation margin received

11,25916,152

Securities segment loans payable secured by securities

26,23341,001

Accrued corporate tax, etc.

7,324

12,299Allowance for bonuses

2,293

2,582

657

645

Allowance for bonuses to directors
Allowance for contract loss

6,341

－

Advance payment received

3,195

3,542

Contract liabilities

18,314

20,646

Deposits received

122,657

100,869

Other

20,202

25,043

1,207,649

1,274,998

Corporate bonds

51,00082,500Convertible bonds with equity warrants

20,77020,605Long-term debt

97,373142,030

Deferred tax liability

1,319

1,601

Other

8,988

9,045

179,451

255,782

949

944

Total Current Liabilities
Fixed Liabilities

Total Fixed Liabilities
Statutory Reserve
Financial instruments transaction liability reserve
Total Statutory Reserve
Total Liabilities

949

944

1,388,051

1,531,725

Net Assets
Shareholders’ Equity
Capital stock

5,000

5,000

Capital surplus

33,28031,961

Earned surplus

37,73043,753

Treasury stock-10,166-10,166

Total Shareholders’ Equity

65,84370,548

3,397

5,615

Accumulated Other Comprehensive Income
Other securities valuation differences
Deferred hedging profit (loss)

48

-61

Foreign currency translation adjustments

2,886

5,700

Total Accumulated Other Comprehensive Income

6,332

11,255Equity Warrants
Non-controlling Interests
Total Net Assets
Liabilities, Net Assets Total

―11―

43

53

82,46992,976

154,688

174,833

1,542,740

1,706,559

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income
3rd Quarter (cumulative)(Unit: ¥millions)

Net Sales

3rd Quarter
Previous Fiscal Year
(9 months to September
2022)
183,134

3rd Quarter
Current Fiscal Year
(9 months to September
2023)
192,545

Cost of Sales

69,87380,703Gross Profit on Sales

113,261

111,842

Sales, General & Administrative Expenses

75,25081,756

Operating Profit

38,01030,085Interest received

324

1,032

Dividends received

857

874

2,628

1,155

Gain on sale of investment securities

61

1,029

Gain on investments in partnership

256

462

Non Operating Revenue

Foreign exchange gain

Other

1,575

771

Total Non Operating Revenue

5,702

5,325

Interest paid

658

1,332

Bond issuance cost

32

305

Equity method investment losses

324

753

Other

258

775

1,274

3,166

42,43832,244Gain on sale of investment securities
Reversal of financial instruments transaction
liability reserve
Other

20,527

69

－

5

16

1

Total Extraordinary Profit

20,54376

Impairment loss

341

329

Loss on valuation of investment securities

500

Compensation for customer’s loss

241

650
－

6,341

－

21

－

92

156

Non Operating Expenses

Total Non Operating Expenses
Ordinary Profit
Extraordinary Profit

Extraordinary Loss

Provision for contract loss
Provision of financial instruments transaction
liability reserve
Other
Total Extraordinary Loss

7,537

1,136

Net Profit before Adjustment for Tax, etc.

55,44331,184

Corporate, Municipal and Enterprise Taxes

12,531

13,203

Corporate Tax etc. Adjustment

3,915

-904

Total Corporate Taxes, etc.

16,446

12,298Net Profit

38,997

18,885

Profit Attributable to Non-controlling Interests

25,143

9,252

Profit Attributable to Owners of the Parent

13,854

9,633

―12―

Quarterly consolidated statement of comprehensive income
3rd Quarter (cumulative)(Unit: ¥millions)

Net Profit

3rd Quarter
Previous Fiscal Year
(9 months to September
2022)
38,997

3rd Quarter
Current Fiscal Year
(9 months to September
2023)
18,885-1,0502,870

Other Comprehensive Income
Other securities valuation differences
Deferred hedging loss

-66

-155

Foreign currency translation adjustments

7,087

6,236

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

-176

41

Total other comprehensive income

5,793

8,992

Comprehensive Income

44,79027,877(Breakdown)Comprehensive income attributable to owners of the parent
Comprehensive income attributable to non-controlling interests

17,18527,604

14,556
13,321―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 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. We also acquired 563,300 shares of treasury stockfor ¥1,509 million pursuant to the resolution at the Board of Directors meeting held on that day.
As a result, earned surplus and treasury stock as of September 30, 2023 were ¥43,753 million and¥10,166 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.

―14―

(Segment information)
I 3rd Quarter of Previous Fiscal Year (01.01.2022-09.30.2022)
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

108,563

23,52831,162

4,133

13,392

180,7812,353－

183,134

Internal transactions
or transfer

935

1,763

－

－

－

2,698

250

-2,949－Total

109,499

25,291

31,162

4,133

13,392

183,479

2,604-2,949183,134

Segment Profit/Loss

16,622

2,212

9,309

-1,05910,31837,403-179

786

38,010

Cryptoassets Incubation

Total

Net Sales*Notesi. “Other” represents real estate leasing and other businesses not included in reportable segments.
ii. Segment profit/loss adjustment (¥786 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 impairment losses on fixed assets or goodwill, etc. by reportable segment(Significant impairment loss on fixed assets)
For the nine months ended September 30, 2022, the Online Ad & Media segment, theCryptoassets segment and Other recognized impairment loss on fixed assets of ¥34 million, ¥12
million and ¥293 million, respectively.
(Significant change in goodwill)In the Internet Infrastructure segment, the amount of goodwill recognized as a result of thebusiness combination with GMO Cybersecurity by Ierae, Inc. at the end of the three months ended
March 31, 2022 was a provisional amount as the allocation of acquisition cost was not completed.
During the three months ended June 30, 2022, the allocation of acquisition cost was completed,and the tentative accounting treatment was finalized, which resulted in the change in the amount of
goodwill from ¥7,724 million (provisional amount) to ¥7,606 million.

―15―

II 3rd Quarter of Current Fiscal Year (01.01.2023-09.30.2023)
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

Sales to unaffiliatedcustomers

126,114

23,95535,5793,120

690

189,459

3,085－

192,545

Internal transactions
or transfer

1,073

1,970

18

－

－

3,062

373

-3,436－

Total

127,188

25,92635,597

3,120

690

192,5223,458-3,436

192,545

Segment Profit/Loss

19,131

1,511

11,202-1,355-030,490-338-6530,085Cryptoassets Incubation

Total

Net Sales*Notesi. “Other” represents real estate leasing and other businesses not included in reportable segments.
ii. Segment profit/loss adjustment (¥-65 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 impairment losses on fixed assets or goodwill, etc. by reportable segment(Significant impairment loss on fixed assets)
For the nine months ended September 30, 2023, the Internet Finance segment recognizedimpairment loss on fixed assets of ¥329 million.

(Significant subsequent event)Not applicable.

―16―