Rakuten profits jump 28.4% in 2018
today Feb 22, 2019
Tokyo-based tech and retail company Rakuten, best known in Europe for its e-commerce operations, has reported net income of 1.12 billion euros for fiscal 2018, an increase of 28.4% compared to the previous year, while revenues totalled 8.7 billion euros, up 16.6% year over year. These record figures were achieved as the company completed some 122 billion euros in commercial and financial transactions over the course of the year.
On the Japanese market, the company's e-commerce operations generated some 972 million euros, an increase of 15.5%, while net income fell 27.3% to 110 million euros. One of the most notable figures, however, is the 36 billion euros in transactions generated by members of the Rakuten ID programme, thanks to year-over-year growth of 10.5%. This project reflects the group's transversal approach, allowing users to access the company's commercial, banking, media and telephone offerings through a single account. According to Rakuten, the programme should multiply the "value" of each user between 4 and 6 times.
Profitable activities undertaken by the company over the course of the year include the Rakuten Overdrive online library, the Rakuten Marketing division and the Ebates coupon business. On the other hand, the company reported losses in its Kobo eReader, Rakuten TV, Viber messaging service and Viki streaming platform businesses. The group also made a loss on its Chinese and German e-commerce platforms, which are currently in the midst of an investing phase. The story was much the same at Rakuten France, where expenses were pushed up by investments connected to the complete rebranding of PriceMinister, a French e-commerce platform acquired by the group in 2011, part of a busy year for Rakuten in France in terms of new changes and partnerships.
As for its objectives for 2019, Rakuten reported that it is aiming for double-figure growth, discounting its real estate operations, which, according to the company's management, are heavily affected by fluctuations in the stock market. In terms of its commercial activities, Rakuten stated that it will continue to follow its product and service offering policy aiming to multiply the number of active users on its platforms. The Rakuten Pay application is also set to play a big role in the company's future projects. The Japanese group further highlighted that it is looking to create "new markets" through the use of big data and artificial intelligence.
The group also used the presentation of its annual report to announce a partnership with Chinese e-commerce company JD.com, which will involve the use of both aerial and terrestrial drones in Rakuten's automated warehouses – the latest step in Rakuten's drone programme, which began in 2016 and was finally tested last year. JD.com is something of an expert on the matter, having already completed over 6,666 hours worth of deliveries with drones and robots.
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