Thank you very much for taking part in the conference call for Z Holdings Corporation business results FY 2021 Q3. Today, we will be using the presentation materials posted on the website titled Z Holdings Corporation business results FY 2021 Q3. Today, we are being attended by Mr. Takeshi Idezawa, Representative Director and Co-CEO of Z Holdings Corporation, Mr. Takao Ozawa, Director and Senior Managing Corporate Officer, Mr. Ryosuke Sakaue, Senior Managing Corporate Officer and GCFO, Mr. In Joon Hwang, Senior Managing Corporate Officer and CGIO. We will first ask Mr. Sakaue to go over with us the results of FY 2021 Q3. After that, we will have Q&A session. The conference call is expected to last 1 hour and 30 minutes. This conference call will be live streamed. Let me note in regards to this live streaming, if you find any disturbance in audio or image while watching, please try switching to different server from the bottom of the screen. With that, we will start the conference call. Mr. Sakaue, please. Ladies and gentlemen, thank you for joining us today for Z Holdings Corporation's Q3 financial results briefing. Before I start explaining the financial results, I'd like to make an announcement. As of April 1st, the President and Representative Director, CEO of Yahoo Japan Corporation will become Takao Ozawa, as announced on January 31st. Mr. Kawabe will focus on the role of Co-CEO of Z Holdings and will further strive to navigate the entire Z Holdings group. We have decided on the change in management as we regarded that Mr. Ozawa was the best person to accelerate the further growth of Yahoo Japan with his abundant experience to date. I'd like to hand over to Mr. Ozawa for a few words. Hello. My name is Ozawa, and I have been appointed to navigate Yahoo Japan as its President and Representative Director from April 1st. For Yahoo in Z Holdings, it is one of the key subsidiaries, and I feel a great amount of responsibility. There are various services at Yahoo. We would like to become a good company that offers great services, so that to our shareholders, to our users, as well as to our employees, I really hope that we can contribute to everyone even more. I would like to ask for the ongoing support of our investors as well. Thank you very much. Now, let me move on to the explanation of financial results. Please turn to the next slide. Here are the topics of financial results for Q3 FY 2021. There are two points I would like to make. First of all, performance came in quite nicely. Three months ago, compared to our assumptions, we were able to see our performance exceed expectations and satisfy. We decided to take the upward revision and guidance. Secondly, for LINE Gift and group synergies were generated. We were able to release new services during this quarter. Of course, great contributions to performance is still yet to be seen. However, with its contribution to performance, we would like to make great efforts. That was a summary comment for Q3. I'd like to go back to the main presentation to speak. We were able to see continued growth in the advertising business led to record high operating revenue of JPY 409.1 billion, up 29.2% year-on-year, and adjusted EBITDA of JPY 97.9 billion, up 24% year-on-year. For profitability, the advertising business is high and the performance was good. A Yahoo Japan license contract was terminated and royalty expenses went down. Therefore, we made an upper revision on the adjusted EBITDA guidance to JPY 330 billion or more. For the advertising business, it reached a new record high of JPY 153.4 billion in revenue, with growth in both Yahoo and LINE due to new LINE advertising products and recovery in advertising demand. In terms of topics, there are four. LINE Gift quick commerce expanded, and also in the commerce area, we were able to generate synergies increasingly. In addition, the release of the PayPay Card and the change of the bonus brand for Yahoo services expanded convenience across the commerce and financial domains. In addition, from yesterday, we launched in phases, PayPay. Finally, we continue to promote capital market and environmental initiatives, including the transition to the Prime Market and the declaration of carbon neutrality. Please turn to the next slide. Company-wide adjusted EBITDA was revised up to over JPY 330 billion from the guidance announced at the beginning of the fiscal year. Adjusted EBITDA for each segment has also been revised in line with business progress. I'd like to briefly go through by segment. In the media business, the main reasons for the increase in earnings were higher earnings in the advertising business and lower royalty expenses due to termination of the Yahoo Japan license agreement. In the commerce business, the upside was due to investment and expense control in the shopping business, with an eye on essential platform improvements, like we've been saying from the beginning of the year. As well as the fact that logistics related investments linked to GMV did not increase as much as assumed. That is why we were able to exceed. In the strategic business, the upside was mainly due to the delay in the release of PayPay Card and PayPay which was later than expected compared to what we were assuming at the beginning of the year, which resulted in a decrease in fixed costs. We were also being selective about LINE related investment projects. For the final item, which is concerning other adjustments, as current performance is strong and the retention and recruitment of talented personnel is becoming tougher. As a company that strives for medium to long term growth, human resources and talent are truly important to us, and we believe that we need to make investments into our people. Therefore, common human resource related investments have been increased, leading to a downward revision, with the specifics, to this fiscal year. As a result of the strong performance of the advertising businesses of Yahoo and LINE, we expect company-wide revenue to come in at the upper end of our previous guidance at JPY 1.57 trillion. Please turn to the next slide. On December the third last year, we passed a resolution to acquire treasury stock through a tender offer, retire treasury stock and issue stock acquisition rights as part of our efforts to transition to the Prime Market. Just to explain a little bit more, the exercise price of the stock acquisition rights has a minimum exercise price, and if the stock price falls below the tender offer price of JPY 663, the stock acquisition rights will not be exercised from the standpoint of economic rationality, a scheme that avoids dilution of the stock value. If all the stock acquisition rights are exercised in the future and the distribution to the market is completed, it is expected to meet the ratio of tradable shares required to maintain the listing on the Prime Market. In addition, as announced by the TSE on January 11th, the company is scheduled to switch to the Prime Market on April 4th. Please turn to the next page. In order to unify the loyalty program, we have expanded places where PayPay Bonus can be used. First of all, for online, we will change the use and granting of T-Point for Yahoo services to PayPay Bonus in April. For offline, from December last year, we started giving PayPay bonuses for PayPay Card payments. In this way, by unifying the bonus brands for e-commerce and the financial businesses into PayPay, we aim to further improve the convenience for PayPay users. We plan to unify the loyalty program in the future, and we aim to further expand the ecosystem by encouraging cross use of services from three action points, taking advantage of one of the largest user bases in Japan. Please turn to the next page. Today, past noon, we announced the 2030 Carbon Neutral Declaration to reduce our greenhouse gas emissions to virtually zero by fiscal 2030. In January last year, Yahoo Japan declared the 100% renewable energy challenge for fiscal year 2023, aiming to achieve 100% renewable energy for electricity use in its business activities as soon as possible. This time, group companies such as LINE and ZOZO will also aim to become carbon neutral by fiscal year 2030. To achieve this goal, we will convert more than 80% of our electricity to renewable energy by around fiscal year 2025 and promote the conversion to 100% renewable energy in the following five years. That is our roadmap. In addition, in order to absorb greenhouse gas emissions from other group companies, Yahoo Japan, which is leading the way, will start carbon negative initiatives. The entire group, hence, will aim to become 2030 carbon neutral. Please turn to the next page. From here on, I will explain the three agenda items in this order. Please turn to the next page. First, I will explain the consolidated results for the entire company. Next page, please. Like I mentioned at the beginning, on a consolidated basis, revenue increased and profit increased on an adjusted EBITDA basis, mainly due to the effects of the integration of LINE. We achieved quarterly revenue of JPY 400 billion for the first time ever. Please turn to the next page. Next are the consolidated results for LINE. Despite increased investment for growth in LINE Gift and financial services, high growth in the advertising business and investment discipline resulted in our fifth consecutive quarter of positive operating profit. Please turn to the next page. Group-related sales revenue for the entire group is shown here. In addition to the effects of the integration with LINE, demand recovery among advertisers and other factors led to solid growth in Q3, with company-wide revenue reaching JPY 153.4 billion, up 64.2% year-on-year. Please turn to the next page. Next is the whole group's e-commerce transaction volume. Although the previous year's hurdle was high due to the strong performance of the service business as a result of the Go To campaign, the steady growth of the merchandise transaction value resulted in an e-commerce transaction volume of JPY 977.5 billion, up 6.5% year-on-year. Please turn to the next page. Next, I will explain the topics and results by segment. Next page, please. First is the media business. Next page, please. LINE's new advertising product, Talk Head View Custom, is doing well since its release. We were able to take advantage of the demand for advertising in December, which is a high demand month, and we were able to acquire brand advertisers that we had not been able to acquire in the past, such as jewelry and automobile advertisers. As a result, as a media section, we were able to improve profitability. Please turn to the next slide. This is LINE Voom. In November 2021, we started to offer the LINE Voom service. With Timeline being revamped, we renamed it as a video platform and will strive to grow the business in the expanding video market. After the renewal, the number of users viewing videos per day increased by 37%. Going forward, we will increase video content stages to promote user use and expand video advertising. Please turn to the next page. Here we show advertising revenue for Yahoo. The result for Q3 was JPY 102.4 billion, which was a growth by 9.6% year-over-year. Now, again, this is backed by advertisers' demand recovering, and also in Yahoo, we have been able to switch the display ad to one platform. Through these improvements, we have been able to find a quarterly revenue exceeding JPY 100 billion for the first time. Especially for search ads, we have been able to see a very continuous UI improvement, and so therefore, we have been able to mark a continuous double-digit growth. Next page, please. Here, we look at LINE advertising revenue, which is also making very good progress. As for display ads, just like Yahoo, we have been able to see an increase in advertisers' demand. We have also been able to again introduce new products. Therefore, we've been able to achieve JPY 29.3 billion in revenue, which is a 31% increase year-over-year. For account ads, again, we have been able to see number of accounts opening increase, and so therefore, we've been able to achieve JPY 20.1 billion in revenue, which is an 11.8% increase year-over-year. Next page, please. From here, I will go over our commerce business. Please go to the next page. Now, I know some institutional investors are asking about their shopping platform because there are varieties of them. This time around, we have decided to again revisit how we try to differentiate ourselves. Starting from the left-hand side, you have Yahoo! Shopping, PayPay Mall, ZOZOTOWN, LOHACO. For these existing e-commerce business, it is very much about making sure we'd be able to refine intrinsic service values to expand transaction value. At the same time, from middle to right, here, these are exactly the platforms that we're trying to differentiate ourselves from the peers. In other words, quick commerce and social commerce. Now here, we're trying to make sure we'd be able to utilize our unique group assets so that we'd be able to offer new purchasing experiences, opportunities. Now, the background behind that, we know that there are various of user needs now. Our group, we want to make sure that we'd be able to, not just offer our service in one platform, but that we want to make sure we'd be able to leverage the characteristics of each of the services we'd be able to do, to put forth. In other words, that's how we want to leverage our collective strengths of the group, so that we'd be able to maximize the total transaction value of the group. From here, I would like to explain other initiatives that we're making to make sure we'd be able to see progress, which brings us to this slide. This is measures to increase LINE Official Account. Now, the number of registered brands is expanding rapidly. Our LINE Official Accounts is spreading gradually as CRM tool for e-commerce. Yahoo! Shopping, PayPay Mall, we have many merchants there. To these people, consulting provided through LINE sales team who would have operational know-how of LINE Official Accounts. In other words, there's good collaboration with Yahoo and LINE team. As a result, the stores that were provided this consulting improved its message open rate and CTR compared to average rate of store newsletter. Next page, please. Here, we introduce our social commerce, in other words, LINE Gift. This is Q3, and there's been lots of seasonal events. Along with that, we have been very proactive in launching marketing campaign. The cumulative number of users surpassed 20 million. As for transaction value, we have been able to increase this by approximately four times year-over-year. At the same time, we are making very good progress with group collaboration, and so store opening by group companies are accelerating. Yahoo Shopping, PayPay Mall, we have begun linkage in products and inventories between these, the platform, which enables us to make sure we have better assortment. For merchants, I do believe we are able to now offer new opportunities for sales. Looking from here, we are also focusing on, for example, birthday gifts. We're trying to make sure we'd be able to create a social gift service where people would be able to use on a daily basis and more casually. Please go to the next page. Next is our quick commerce that we're working with ASKUL and Demae-can. Just like we announced last week, as we try to make a full-fledged operation, we have decided to make a rebranding to Yahoo! Mart by ASKUL. At the moment, we have been able to expand the number of stores to nine. We are leveraging ASKUL's product procurement capability, and so therefore, we have products, 1,500 types of products to be handled. Within the demonstration experiment, this is something that we have been doing from October to December. The total number of orders increased by tenfold. Through this demonstration experiment, we have been able to answer some of the questions like, "Do we see really immediate needs for daily goods and food items?" We also have a question of, "Can we really make a good operation around this delivery?" We have been able to find confidence on that. As we look ahead, we're trying to open several dozens of stores in the next fiscal year and establish a system that would cover all 23 wards in Tokyo. Please go to the next slide. Here, we show merchandise transaction value. For shopping business transaction value, we have been able to find a contribution by Cho PayPay Matsuri, and so therefore, we have been able to see a 21.1% increase year-over-year. For resale business, we have been able to find Yahoo! Auctions, a user expansion PayPay, a higher spend per user in Yahoo! Auctions, and expansion in PayPay Flea Market, and so we have been able to achieve a double-digit growth. Now, moving on to our strategic business. Here, we show our PayPay initiatives. Now, the impact of payment fee to small and medium-sized merchants in terms of the cancellation continues to be small. The first tier of what we call the first year of monetization, we are seeing a steady increase. In terms of the second tier, in other words, this is about PayPay My Store, we have been able to find number of merchant that would sign up here, increase steadily. PayPay Coupon usage is also increasing, which is again contributing to the revenue growth. Through these methods, we have been able to find PayPay revenue increase. Now, when we look into the profit before acquisition cost, in other words, the profit divided by deduction, deducting cost of sales, in other words, fund source costs plus regular user rewards and fixed costs from revenue, we do offer this type of 0.5% PayPay Bonus. When we deduct that, this part of the profit, in other words, again, the profit before acquisition cost, we have been able to achieve profitability in two, three. It has been three years since the launch of this service. If we decide to stop, for example, not just a 0.5% PayPay Bonus, but then if we stop paying for that tentative acquisition cost, we know that profit is in sight. On the other hand, we do not have intention to stop spending these acquisition costs. We do still want to keep on spending these acquisition costs because it would be a good seed for our future growth opportunities. Next page, please. In order to pursue our monetization, we're also looking into the top, the third tier, in other words, financial services, and we are making very good progress here as well. First starting from left, this is something that we started back in last December, PayPay Card. Yesterday, you also see this on the right-hand side, but we have also introduced PayPay Atobarai. We will make sure that we will be notifying the users once we would have more services available. In this PayPay Atobarai, you can use PayPay for your payment without having to charge to the PayPay balance upfront. This PayPay service is not just available for PayPay merchants, but then this will also be available to Yahoo! Shopping and PayPay Mall as well. Now, with the PayPay Atobarai, we can increase PayPay users' usage spending and balance, but also we can aim to enlarge this ecosystem through diversification of payment methods because we'd be able to really meet the various users, be it online or offline. Next page, please. Ever since last year, we know that NFT market is seeing a rapid expansion. LINE has also started its own work here. This is something that we have not explained before, so I'd like to use a slide here. In Japan, from last June, we have started launching NFT market beta. With LINE, you can easily send NFT. We want to make sure we'd be able to expand this NFT business through competitive advantages leveraging LINE's features. We will be starting LINE NFT in spring in Japan. We want to become number one NFT marketplace in Japan. Last year in December, we started LINE NEXT for the global financial market, and we have an entity in the U.S. and South Korea. We want to make sure we'd be able to expand this NFT platform globally. These new services like NFT, it is important that we capture the global market at an early stage, and that is very much why we have started this. In other words, our aim is to lead a service that popularizes NFT globally. Next page, please. Here, this is something that we always show, in other words, major KPIs behind PayPay. Again, various KPIs performed well even after the introduction of payment fee to small and medium-sized merchants. The quarterly PayPay transaction value grew to a scale of JPY 1.5 trillion. Here we show the major KPIs for PayPay Card. Now, PayPay Card, this is something that we launched last December, and it will be accelerating membership growth by utilizing group company's assets. For the transaction volume, especially in December, that was a very high season in terms of sales, the quarterly transaction volume exceeded for the first time JPY 700 billion. Next page, please. Here we show the major KPIs of our banking business, PayPay Bank. After the change of trade name to PayPay Bank Corporation, acquisition of especially PayPay users increased. You can see that these KPIs have been making very good growth. From hereby, we do also want to make sure we'd be able to leverage PayPay ecosystem that we'd be able to expand our financial service. Here, this is the financial business that we have under LINE brand, and here again we have the major KPIs. For example, the number of accounts for LINE Securities, the loan balance of LINE Pocket Money, as well as the loan balance for LINE Bank. Here we show the growth rate, although we don't have the specific number itself. Now, again, in Japan, we want to make sure we'd be able to utilize securities and Pocket Money to tap into potential financial needs through LINE. For the global financial business, we want to make sure that we'd be able to tap into the local users, which would be different from the needs with the people in Japan. Next page, please. Finally, I'd like to go over with you again the business result forecast. Next page, please. Like I mentioned at the outset, the adjusted EBITDA for the total group company is now going to be up, revised upward to over JPY 330 billion. Now, if you look at each segment, the revenue and adjusted EBITDA has also been revised accordingly to the business progress. The group total revenue is now at JPY 1,570 billion, which is marking the top range of the guidance. That concludes my explanation. Thank you very much. Mr. Sakaue, we thank you very much. We would like to now move on to Q&A. If you have a question, please press zero one on your phone. When it's your turn to ask a question, and if the MC calls your name, please ask your question. If you would like to cancel your question, please press zero two. Let me repeat this once again. If you have a question, please press zero one on your phone. When the MC calls your name and it's your turn to ask a question, please go ahead. If you would like to cancel your question, please press zero two. Now we would like to start the Q&A session. We would like to also say that, for questions, you will be able to ask up to two questions, and please ask both questions at once. If you have a question in English, we will be handling the question through consecutive interpretation. Please hold while we interpret your question. Thank you. The first person, it will be Mr. Maeda from SMBC Nikko. This is Maeda from SMBC Nikko. Can you hear me? Actually, your voice is pretty low. Can you speak a little bit louder? How about this? It's better. My first question, for this fiscal year, an adjusted EBITDA guidance of JPY 330 billion. I think as a start, after the integration, you are off to a good start, and you analyzed the reason why you are going to go through the upward revision. For the ongoing components as well as for delay of execution of expenses, which may be a negative for next fiscal year, I think there's going to be two types of items. Towards the next fiscal year view, what does this fiscal year's performance imply? For JPY 390 billion that you're aiming for in 2024, if you have any implications, can you share that with us? Because I think at this pace, you will probably be able to aim higher. My second question is about PayPay. The loss equity pickup is becoming greater by quarter. You talked about acquisition cost and that you have no intention of reducing it at this point in time. What is your tolerance around the amount of losses generated, or do you think that losses are going to start decreasing from next fiscal year? About the timing of when you expect profitability to turn positive, can you share with us your thoughts about the P&L of PayPay? Thank you very much, Mr. Maeda. I will take both of the questions. For the first question, which is about next fiscal year onwards, as well as fiscal 2023 or March 2024, and what we think about the targets we have in place right now. Well, for next fiscal year, at this timing, we are currently in the budgeting process, and we are revising our midterm plan at this phase. Unfortunately, we are not able to speak about next fiscal year at this point in time. By the end of the fiscal year, when we have a results briefing, we will probably be able to give you more direction. For March 2024, JPY 2.39 trillion in adjusted EBITDA and JPY 2 trillion in revenue, we view this as a commitment from us, so we would like to ensure that we achieve these target numbers. We do understand where you're coming from, Maeda-san, but JPY 2 trillion of revenue and JPY 390 billion of adjusted EBITDA are numbers that we would like to definitely achieve. For the second question, PayPay and the losses associated with it, for this as well, expanding the user base and increasing the penetration of cashless payments will, in turn, in the future, become a good foundation for the finance business in the future. We are not going to aim for product profitability right at once and aim to reduce costs. That's not what we're thinking about right now. For the scale of losses as well as the timing of when we would like to turn profitable, we are talking and having dialogues with the PayPay Company. Once we are able to share some direction with you, we hope to do so. For both of the questions, I apologize that I wasn't able to directly respond to them, but that's basically our response. Thank you very much. Thank you very much. We will move on. The next question will be asked by Ms. Mori from JPMorgan Securities. Thank you very much. I also have two questions I'd like to ask. My first question is about your strategic business. When you look into Q4, I'd like to ask your plan. For example, FinTech sales, I believe, it is expected to grow more. At the same time, there's also going to be a loss that would also increase in Q4. Now, PayPay Card and PayPay Atobarai, I guess, it is partly because of that, but then, can you give us a little more about the flavor of your plan for Q4 and also for next year? These new services that you have, I suppose, will start to contribute to at least shrinking some of the loss that you already have. Is that what you have in mind? Do you think you still need to be on an investment phase? For example, I do believe that within your strategic business, there are some areas where you still haven't been able to make some investment, and you will just keep on making investment. Is that really your thought? That's my first question. My second question is around your commerce business. Like social commerce, quick commerce, these new initiatives, and also for MySmartStore. I believe each of these new businesses will be in a different phase, but when you look into next fiscal year, what kind of contribution do you think these new initiatives would start contribute? This year, commerce business, I think you've been able to have good control in the cost, and GMV has been increasing very well. Now that you have new initiatives, will there be more investment next fiscal year, or are you going to keep on controlling the cost and be able to see the benefits coming from the contribution coming from these new initiatives? Yes. Thank you very much. I would again like to answer these, your two questions from Sakaue, but then I do believe perhaps Mr. Ozawa can follow up the second part of your question as well. Q4, what is our outlook for the strategic business? That's your first question. How do we see the next year? I took that as your first part of the question. For the strategic business in Q4, of course, if you just calculate, you'll be able to calculate what kind of EBITDA we are expecting. For PayPay Card, and we also have the Atobarai. For these, we need to first of all invest so that we'll be able to capture new users. That's one thing that we will have to do. There is a portion of investment for that. At the same time, it may not be as large as a PayPay Card, but then LINE Securities and LINE Credit, this is again where we are seeing an expansion of user base. We want to make sure we'll be able to accelerate that. In other words, invest as for sales promotion in these areas. In other words, there will be a loss that will increase in Q4 in that sense. That's my response to your first part of the question, but then as for next year, of course, when we look into next fiscal year. We still expect that there will be loss coming from most of these new initiatives. Within the appendix of the presentation deck, we do have a specific PL for card business and strategic business. For example, depending on the phase, some will turn profitable, some will still have some loss, but that's where we are. That's how we view the strategic business, and that really follows what Mr. Maeda was asking before, but this is how we look with the strategic business. Now, second part is about the commerce business, social commerce, quick commerce, MySmartStore. How or what kind of contribution would these have? Now for next fiscal year, again, this is something that we internally are yet discussing, but we do not exactly believe that we'd be able to hold such a high expectation that these new initiatives will start generating contribution. Because we do believe next year it is still during a phase where we need to sort of start growing, keep on investing to grow these new initiatives. If Ozawa would have anything to add. Yes. These new commerce part of the business. What is the status? We're still waiting to see if we'd be able to find a good win. Yes, we have been making some sizable investment. Then at the same time, we're not just staying calm. Of course, when it comes to quick commerce, there's the delivery part of the cost. We need to create sites. It's different from pure digital e-commerce. It's not like a business where we'd be able to increase the revenue by like five or six folds immediately. We still do have to plan out what the investment would be. Now, as we look into the next fiscal year, it's, for example, we can say that there is going to be a large investment and that is why we're going to make a loss. No, but that's not what we're trying to say here. When it comes to the entire phase mix, and if we find that there needs to be a good investment made, especially for future growth, we will make sure that we'd be able to tell that to you upfront. At the moment, we're still trying to clarify what the requirements are. If I may, a follow-up. The LINE Gift. I do believe there is a good growth. I don't exactly know the exact value, so I can't really say much about here. When it comes to the growth, and if there is any, like, a contribution to GMV, is it correct to say that LINE Gift does have a good presence already? Yes. Thank you very much. That's something that Ozawa would like to answer. LINE Gift, in terms of absolute value, yes, we are finding a good sizable number now. We are expecting that we will start to see a good contribution, some contribution. Of course, it will start to generate profit under the economics, of course, depending on how things go. Yes, this is a business where we do have lots of expectation in looking into the next fiscal year. Thank you very much. Thank you very much for the question. Next person is from Citigroup. Mr. Tsuru, please, over to you. My first question is about numbers for EBITDA guidance. You made an upward revision this time around. How do the following numbers fit into this equation? First of all, Yahoo license. The termination of the contract, how much is that worth? Secondly, LINE's performance, previous outlook and the current outlook and the difference. Thirdly, strategic expenses. You were saying originally, JPY 20 billion-JPY 30 billion, but how are you accounting for this time around? That's my question. Please wait a moment. Let me answer in order. First of all, for the Yahoo license, it's about JPY 9 billion that we are accounting for. The next one is LINE's outlook. We don't give out the guidance in detail, but for media, about JPY 26 billion of an upward revision is accounted for. A certain portion of it is accounted for by LINE. That's the way you should look at it. Also, for the strategic expenses that we originally communicated at JPY 20 billion-JPY 30 billion, currently, we are expecting about JPY 22 billion in investments. That's what's accounted for in the current guidance. Understood. I'm sorry, this is my second question. When you look at LINE's performance for Q3, JPY 4 billion went down to JPY 3.8 billion, OP wise. Why was that? And how should we view the outlook going forward? The media business continued to perform briskly. But LINE Gift, it appeared in the GMV as well, but we made aggressive investments, so we were incurring more expenses, and that is why profits declined on a year-over-year basis. For Q4, ad revenue is expected to continue to be briskly, but JPY 10.6 Billion. For Q4 2020, there was a one-time divestment gains included in this number. So compared to that, we are expecting a decline in profits. However, the trend of heading towards profitability is unchanged. For next year, we're currently in the middle of the budgeting process like we are for the overall company, so we are not able to speak to that. Thank you. That's all for my questions. Thank you very much. Next, we will have Okumura from Okasan Securities. Mr. Okumura from Okasan Securities. Thank you very much. This is Okumura from Okasan Securities. I hope you can hear me. Yes, we can hear you clearly. Thank you. I also have two questions. My first question is, I know, we're coming back to this again, but how you are looking at next year's outlook. Next year, it is going to be the two years before you end your current MTP. There could be, for example, you may want to be making investment. You can speak to the extent you can, but what is your plan for example, how much investment and how much profit do you mean to make for the next year, fiscal year? Also for Q-on-Q, I know there's a bit, like 200,000 increase. Now, of course, ever since you launched PayPay Card, there must have been a net increase from December and does that have to do with that? I know that your peers have also been seeing this type of increase, but then from Q4 and onwards, are you expecting to see a net increase in this number or are you trying to accelerate? If you'd be able to comment. Those are my two questions. Thank you very much. First of all, how we see next fiscal year. I'm sure, Mr. Okumura, you must have a lot of your thoughts, but then, again, it is something that we are discussing internally, so I would have to apologize. We will not be able to specifically answer your questions. Your next question. What kind of growth are we seeing ever since we launched PayPay Card? For Q3, again, it is just December, the month of December alone. You know, we have been able to make a good start, but then it's not that we've been able to find a large impact or large contribution yet. For Q4 and onwards, we talked about this is exactly where we want to spend a strategic investment. That means, in terms of the membership, we're trying to make sure we'd be able to accelerate the growth. At the same time, we have to think about efficiency in the investment. when it comes to the effective user number, we want to make sure we'd be able to see an increase, and we do want to make an investment for that purpose. That's my response. Thank you very much. That's all of my question. Thank you. Thank you. Next is Mitsubishi UFJ Morgan Stanley Securities. Mr. Araki, over to you. Thank you for taking my question. I have a numbers-related question. For Q3 and the equity pickups, gains, and losses. It was JPY 14.4 billion, I believe. It was pretty big. For Q2, it was JPY 10.9 billion. You were saying half of that is attributed to PayPay and the other to Maicon? I think this time around it was JPY 14.5 billion, so can you break that down for me? For the October to December quarter, for PayPay, you started to charge the payment fees to the small to medium-sized retailers. If you can talk about the way that worked, that would be helpful. Secondly, ID tie-up with LINE, has that started or not? My understanding is that it has not yet started. If you're going to do this next fiscal year, how much would you need to spend, and what kind of spending would that look like? In the case of Yahoo, there are people who have IDs, some other people do not. For LINE, I think pretty much people are not sure if they have an ID, but they do. When you're going to start the integration, are you going to send a notice or email? And if they agree, are you going to send sales promotion costs, like to give them 10,000 points or something? Can you also talk about that as well? Thank you. I will take both of your questions. Mr. Ozawa, Ozawa, if they would like to add any question, comments about the second question, they will. First of all, for the equity pickup gains and losses, which is minus JPY 14.5 billion. For the breakdown, we do not disclose the actual details, but out of the JPY 14.5 billion, PayPay is about 10%, and former LINE group, it's about 1-2. Meaning, it's about 1/3 PayPay and 2/3 the rest. Out of the 2/3, half of that is about Demae-can. So the loss pickup between Demae-can and PayPay is about the same. For the balance, in Southeast Asia, LINE MAN as well as LINE Financial Services affiliated companies have been generating losses, which we also capture in pickup. On a quarter-on-quarter basis, there has been an increase, as you pointed out, and that is attributed to the Southeast Asian business as well as Demae-can when you compare on a Q-on-Q basis. Demae-can is a listed company, so I'm not able to give you clear numbers. They were doing a free delivery fee campaign in Tokyo as well as the peripheral three prefectures right now, just to mention. That's the answer to the first question. For ID integration, the second question, at early point next fiscal year, we hope to move things forward, and currently we are preparing internally. In order to promote ID integration and various promotional measures, we are actually having discussions right now about them. We are not able to give clear guidance as to what kind of scale of promotions we have, we are considering. Do the other two gentlemen have anything to say about this question? This is Ozawa. Internally, we are brainstorming right now, so let me share some thoughts we have. For ID integration, we basically want to say that it's going to become even more convenient and communicate benefit to the users, without spending costs. We also want them to actually feel that, convenience has been enhancing so that, they will agree, to ID integration. That's the base way of thinking. That may not be enough number wise. If it's incentivized as a program, we will be able to promote ID integration. The unit price for advertisements, may go up and due to the synergies, there should be an uplift. Then after deducting costs, if we think, we should go ahead with that, we will talk about points that people can get if they engage in ID integration, or there might be a lottery, through which they can win something. The incentives that we are currently providing may have ID integration as a condition, and we already have that kind of track record in doing Yahoo! Japan and PayPay related ID integration. We didn't have to spend that much in doing so. We would like to use money in a way that would be effective. Thank you. For the first point, on a Q-on-Q basis, have PayPay losses decreased on a Q-on-Q basis or have losses for PayPay increased? It's slightly increased. It's pretty much flat, though. Thank you. Thank you very much. Next question will come from Ms. Sawada from Ace Economic Research Institute. Yes, this is Sawada from Ace Economic Research Institute. Thank you very much for the presentation. I also do have two questions I'd like to raise. My first question is around your e-commerce. If you'd be able to recap what how you were able to find for this high season sales. Because I did realize that for this December there was not much of a promotion or discounts, but then users as well as the merchants, what were their reaction, if you'd be able to recap that for us? My second question is about LINE NFT. Within your strategy, what is your goal? And also, how you try to position your services, if you'd be able to give a little more explanation there. Thank you. If I may, repeat your question. First of all, how we look into the year-end marketing campaign, how that went, and what was the response from the users in the e-commerce? And also for NFT, what kind of service are we trying to roll out? We will make sure that we'd be able to answer your question. The first question. Yes, this is Ozawa. Again, for the December marketing for e-commerce, of course, we're trying to make sure we'd be able to achieve a good growth year-over-year. That's what we always expect to do. However, this time when we look at the results, we do believe- That it was pretty much in line with our expectation. In other words, yes, we were able to find a good growth. Now, we do want to make sure that we'd be able to keep an eye on to expect that e-commerce will keep on growing, especially because we're still in the pandemic. At the same time, this hometown tax, that's also another part where we are seeing a very interesting growth. We are also doing a lot of the sales promotion together with ZOZO. We've been able to see a good growth trajectory in both. In total, if you look at on a year-on-year trajectory, we do believe that we have been able to find a very good upturn this time around as well. For the used side of the business, like Yahoo! Auctions, Yahoo! Auctions PayPay Flea Market. Again, towards December, there has been a very good move, and we've been able to capture all the interest, all the sales. Also, thank you very much. The second question will be answered by Idezawa. Yes. This is Idezawa. I'd like to answer your question around NFT. Now, as you know, for NFT, there's a lot of global players already in this space. Within the current trend, we know that this is a very good momentum. It's really like the new platform or business trend that we need to capture. That's exactly what, how Z Holdings will be looking at this NFT. Now, LINE, ever since 2018, have been working on blockchain. We have very much been spearheading this move. We have our original platform. Also we have experience of the marketplace. We actually do have knowledge around offering full package service around these, for example, fintech and NFT. We do have great assets to work on this field. In addition, Z Holdings, we do have a lot of entertainment related content. From that perspective, I think there's this great affinity with what we'd be able to do in this NFT space as well. Japan, global market. We're trying to make sure we'd be able to expand this platform in both. It is probably not exactly like a continuous growth that we'd be able to expect that we've like been seeing in other parts of the business, but that's how we look at this NFT business. Thank you very much. If I can just make a follow-up question to the second part of the question that I asked. LINE NFT, what is going to be the content there? Is this something that Z Holdings would be bringing? Is my understanding correct? We will be making announcement in the upcoming spring, I hope you'll be able to stay tuned. It's not that it's just going to come from just Z Holdings. For example, we know that there are right holders that would have great content. We want to make a platform that would be open to these other people as well. Thank you. I think I have better image now. Thank you very much. That's all for my question. We are open for questions. If you have a question, please press zero one. Let me repeat again. If you have a question, please press zero one. Next is from Mizuho Securities, Mr. Kishimoto. This is Kishimoto speaking. Can you hear me? Yes, we can. Please go ahead. Thank you for the explanation. Well, you made an upward revision in the media business. I presume that LINE's ad business did well. For Yahoo, for Q3, the market was risky, I believe. In light of that, for search ads, display ads, can you give us more flavor on how they performed? When you do the math, what are your assumptions for the fourth quarter? That's my only question. Thank you for the question. For the media business, especially about ads in the Yahoo site, and that its outlook was the point of your question. There are several things I would like to communicate. For Yahoo ads in Q3, first of all, for search, for talent, property, finance, it picked up as well as the unit prices also picked up from advertisers too. To that end, we were able to see 12% growth. Performance continued to be brisk. For display ads. For this part as well, from reservation type, we were shifting to programmatic, so that was a positive on performance too. We also were focusing on one platform so that the tender offer can be automatic and the distribution can become improved. We implemented that. A quick unit price saw an uplift. For Q3, I do believe performance was good. For Q4, it is the end of year season. There are some unpredictable parts, especially due to the economic trends as well as the Omicron variant that we are currently seeing spreading. For Q4, our outlook is quite on the conservative side from that point of view. Thank you very much. Thank you very much. The next question will come from Mr. Oliver Matthew from CLSA Securities. Mr. Matthew, please. Hello. I have two questions. The first question, could you tell us more about the commerce business sales were up 7% and profits were down. Could you explain more about the performance of each part of commerce? Secondly, in the guidance, you increased the others adjustment quite significantly. Could you explain why that is going up? Do you expect some special adjustment in the fourth quarter? Thank you. Hi. Yes, thank you for your question, sir. Allow me to answer your first question. For the commerce business, again, the year-end sales, the season, and as well as, LINE Gift these social gift area, we have been investing, in other words, sales promotion. That is one reason. That is why, even though we were able to see an increase in the sales, the revenue, there's been a lot of costs associated with that, and that is why profit or in other words, the profitability went down. That's really the details to explain the first part of your question. Also for the second part of the question, in other words, about the adjustment. Again, should we focus more on Q4? In that case, just like we said in the presentation, again, we want to make sure we be able to invest for human talent. This is because it is going to be very important as we try to fight with the peers in the mid to long-term. Again, alongside with the very good performance with the business, we have also made sure that we be able to make a good investment for human talent and also for retention purpose, so that we be able to have a good base business base. That is why for this others part, there's more increase in the number of the loss. Okay. Thank you. We are open for questions. If you have a question, please press zero one on your phone. Let me repeat that one more time. If you have a question, please press zero one on your phone. The next question is with Morgan Stanley Securities. Mr. Araki. I originally had three questions, so I'm going to ask one more question. For the shopping business, out of your overall upward revision, it is actually on the lower end. Originally at Q2, you were talking about sales promotions for Q3, and you were saying that it's going to be slightly higher than Q2, Sakaoki-san. From JPY 27.4 billion in Q2, it went up to JPY 33.1 billion in Q3. I'd like to ask Ozawa-san this question. Spending a lot of sales promotion costs in order to just increase GMV, have you stopped doing that? In your original guidance, you were anticipating 12%-25% growth. In Q3, you have decided to go ahead with 12%, which is the lower end of guidance. Has something changed from the beginning of the year, or was 25% a stretch target? Because you were saying end of year season was in line with your expectations. Is this number not weak at all? GMV sales promotion cost and your thoughts on profit would be appreciated. The beginning of your target of 25%, why are we going with the lower end of your guidance range this time around? That's my question. This is Takao Ozawa speaking. I will take your question. First of all, for the 25% number, from the time we set that target up, internally, we did think it was a very aggressive target because last year, in light of COVID, we were able to see quite good growth, and we did also spend sales promotion expenses that also supported the growth. Of course, we did control it quarter by quarter. In light of COVID-19 and its unpredictability, we weren't sure if 25% was possible, but we did set a range of 12%-25%. Throughout the year, we ended up going back and forth, but now we are expecting that the end of the fiscal year, we will be at 12%. We are currently looking at the trends in GMV growth as well as the rise in cost. Of course, we would have loved to have achieved the 25% stretch target, but our guidance is different from that. Thank you. Thank you very much. Next question will come from Citigroup Securities. Mr. Tsuruo, please. Sorry. Tsuruo-san, Mr. Tsuruo, I think you're muted. Excuse me for that. Allow me to do that once again. I'm sorry that I wasted your time. I have a question around your strategic part. I know this is my second round, and I'm so sorry that I had kept myself muted. Now, I want to ask this to Ozawa-san. I know yesterday we heard that you're going to be leading Yahoo from now, and you've already went through some press conference, and you probably will be making a more formal announcement at the point of April. Then if you have any message to the investor community at this point, I'd love to hear that. Thank you for raising that question. Just like you said, it's going to be from next fiscal year. We at the moment are trying to compile the strategy so that we'd be able to show you. This is something that, of course, that we want to show to our internal employees as well. At the same time, we do want to make sure that we be clear in what our, what the new plans are to the investor community. Now, when I was given the baton from Mr. Kawabe. Now, Mr. Kawabe as well as SoftBank, a neighbor who will be our large shareholder, they're, they've given the message that they have large expectation. This is very much because Yahoo, if we compare to the peers, on a relative manner, is getting a bit weaker. This is something that we can say when we look at various fields. When we look at the commerce side of the business, it's not exactly where we had always been very, very strong here. To, in this aspect, how could we be able to essentially increase the scale or the capacity of the service is going to be very important. Now we have LINE and, what kind of true synergy we'd be able to, practice, and there's also the Alipay. What kind of synergy in a true sense would we be able to pursue? That is what Yahoo is really going to be required to show. Now, I myself, is more on the service development side. I'm not exactly from the marketing side. Advertisement and commerce. I'm not just going to look at commerce, but I also want to look at, for example, what we'd be able to do on advertisement side. Now, marketing is not exactly just a promotion. Of course, marketing is a promotion, but then it also needs to be linked to what kind of service we'd be able to create. Again, how we'd be able to pursue the real growth utilizing all these capabilities, the potentials that we have, is really going to be important. That's exactly where I do want to focus as we try to show our strategy, and I do want to have an occasion where we'd be able to hear of your advice. I do want to do my best. Now, Yahoo, after 20 years, we're in a state where people would be a bit worried, but we want to make sure that everyone would feel confident in looking at Yahoo and say, "Yes, this is a very interesting company." Thank you very much. A follow-up question to that. Now, we don't have Mr. Kawabe today, but Mr. Kawabe, do you know how long he's been spending his time for Yahoo? And now that part of time, where is it going to be spent from here as he tries to focus us as a CEO, co-CEO of Z Holdings? Do you know? Well, again, Mr. Kawabe is not here, so we can't really answer how many hours he's been spending for Yahoo per se. But then from next year and onwards, Z Holdings, and Mr. Kawabe is going to be looking at Z Holdings as well as other group entities. That would include Yahoo as well as LINE. There's also other fintech entities as well as overseas entities. Mr. Kawabe needs to spearhead the growth in these areas as well. I'm sure he is going to be looking over all these varieties of business so that Z Holdings as a group will be able to enhance the performance. That's exactly what he's going to be focusing on. At least that is my understanding. Thank you very much. Just one more question, if I may. As for the status in the Demae-can, I know you haven't been able to gain great reputation and some accounting issues. We've observed that, witnessed that. Now, with all these issues and what kind of return you'll be able to expect, including what you'll be able to do on a quick commerce, that's something I would like to hear from you. Yes. First, for Demae-can, I know there's been a lot of concerns been raised by many people. I myself, as I looking into the accounting and finance areas, I do want to make sure that we do not cause anything of the like again. Now, for Demae-can, the app download, of course, this is something that we cannot really specifically say. But, at the point of December, we know that, for example, within the delivery service, Demae-can has been able to really come to a number one position, thanks to a lot of promotion that's been launched. Of course there's still loss, but in terms of the delivery at Demae-can, I do believe we'll be able to increase the market share. Of course, when it comes to unit economy mix, we have to make sure that we are able to work more on that for Demae-can. We do have confidence that we'd be able to have a good growth. Now if Ozawa-san would have anything to add. Yes. For food delivery, we are looking forward to great growth here. Quick commerce, Demae-can, the role of Demae-can in the quick commerce space, it is something that is worth paying attention to. I, as a director, think so. I have been appointed to join as a director of Demae-can, so I am hoping that we'd be able to exercise group synergy. We will make sure that we enhance governance so that we'd be able to create Demae-can even a better business. Please look forward. Thank you very much. That's all my question. We are open for questions. If you have a question, please press zero one. Let me repeat that. If you have a question, please press zero one. There seems to be no additional questions, so we'd like to end the Q&A session. Finally, Mr. Sakaue will speak closing remarks. Well, thank you very much for coming to the Q3 business results call. Thank you for your valuable feedback and advice today as well. We would like to continue to work hard to enhance shareholder value. We would like to ask you for your ongoing support. Thank you very much for your time today. This concludes Z Holdings.