Recruit Holdings Co Adr

Welcome to the Recruit Holdings Company Limited Q1 FY2024 Earnings Conference Call. This call is the simultaneous translation of the original call in Japanese, and translation is provided for the convenience of investors only. I am Mizuho from IR and PR, and joining me today is Junichi Arai, Senior Vice President, Corporate Strategy and Investor Relations of Recruit Holdings. The Q1 financial results presentation video and transcript were uploaded to the IR website at 3 p.m. today. Today, we will start with Jun's opening remarks, then followed by a Q&A session. Now I pass the call to Jun. Please go ahead. Hello, everyone. Thank you very much for your attendance today. Before I take your questions, I would like to make a few additions to the presentation we disclosed at 3 p.m. just one hour ago. So three months ago, in the FY2023 earnings announcement on May 15th, Deco said the following about the positioning of the current fiscal year and the background behind FY2024 guidance, especially for the HR technology business. So let me once again refer to that. When I was thinking about this message this morning, Hiraoka-san of Nikkei wrote an article on the eyes from the journalist about us. And I think this article is only in Japanese. So I hope this will be translated into English so that the overseas institutional investors can take a look. And regarding the content that we disclosed on May 15th, our thinking behind and my meetings in July were summarized well in the article. Exactly the message I wanted to talk about today, and so it will be redundant with that article, but let me once again mention this. What Deco said on May 15th is... the following of course financial market stress is increasing under high interest rate conditions and economic uncertainties remain high i mentioned earlier against the background that the supply of workers to the job market in the u.s is not increasing significantly as in the past and even if a recession occurs we believe that it is unlikely that the number of job openings will decline by another three million or so from the current level we assume that the number of job openings in the u.s will hit the bottom after decreasing for another 18 or 24 months In FY 2024, we would like to operate in the year zero of the economic cycle in the sense that the decline of job demand may bottom out and the trend may turn up in the future.

By improving the efficiency of monetization, which has been our focus in recent years, we hope to return to a positive year-on-year revenue trend in the second half of the fiscal year, even during a period of declining job openings. So that was the message by Deco. In other words, the FY 2024 forecast for HR technology and the consolidated guidance range are based on the assumption and outlook that job demand in the U.S. will continue to decline until mid to late FY 2024, excuse me, FY 2025, then will bottom out. Looking at the Q1 revenue for HR technology on a U.S. basis, revenue in the U.S. decreased 5.0% year over year. However, it increased 7.7% quarter over quarter. And HR technology segment revenue including Japan and the rest of the world, decreased 2.5% year-over-year, however, increased 7.2% quarter-over-quarter, which means that the Q1 results are in line with the assumption we communicated on May 15 that the revenue for the first half of fiscal year 2024 will continue the trend of year-over-year decline. Given the current situation, we believe that there is no need to revise the full year guidance range. However, if we determine that it is necessary to revise our guidance due to changes in the business environment, we will communicate to you at the appropriate time. And after the announcement, we received a number of questions from many people, so I'd like to provide a response first. We will conduct a share repurchase of a maximum of 600 billion yen. We've announced such a share repurchase program, and on the first day of that announcement, we've made share repurchases through the TOSNET3. Some investors asked who actually bought the shares. I was not able to provide a response to that question, so I will continue to refrain from disclosing that. But the day before yesterday, The seller's earnings releases made a mention of that. Since it has now become public information, I would like to share information with you at this time. There have been speculations that perhaps overseas investors made a sale, but that is not the case. Entity Data was the company that made a sale on Tosnet 3. This has become public, so I can share this with you now. So now I will take your questions. I will hand over to you, Shen-san. If you have a question, please click on the Zoom raise hand button. Please unmute before asking your question. We will accept up to two questions at a time.

So first of all, Nomura Securities, Oma-san, please. Thank you very much, Omi of Nomura Securities. Can you hear me? Yes, thank you, as always. I have a question on Indeed job posting. In July, various sectors, the index is now trending upward. So Arai-san, if you could share with us your view on this. Is this one-off, temporary, or it has hit the bottom and is trending upward? So that's my first question. Second question is, in the material, it says, indeed, monetization progress. compared to q4 q1 is starting to shore results it says so if you could elaborate on that point which part you see some actual outcome thank you thank you for the question thank you for looking at the data very closely as i've mentioned in the past we do not become overly happy or disappointed by monthly results So this alone cannot help us making a big decision, but the data may look flat, but the volatility is still high. So in November, when we announce our second quarter results, I would like to touch on this. We do not want to be happy or disappointed on monthly results and just steadily work, do what we have to do. So that is my question, answer to your first question. I do not think it has hit the bottom yet. And progress. how we can offer higher value higher added value products and services so that more users can use our service and pay money to us we talked about this in the march event we're taking various initiatives and also developing and launching smaller scale services and try to identify what works and what doesn't so we're trying to accumulate knowledge and experience And as a result of that, the unit price is rising up. So what work? We will increase the scale, the area, the customers, number of customers. But we're trying to try many things and try to work what works and decide what doesn't work on a day-to-day basis. It's not that we are having a higher hit rate, but on a quarter on quarter, U.S. and for the entire segment, we are trending upwards. So I can say that there are certain level of impact. So we will continue researching and studying our initiatives. Thank you very much.