Individual smartphone ownership in Japan rose to 77.3% in 2022, as the quantitative expansion continued, with the exceptionally high popularization rate of more than 90% of those in their 20s through 50s now owning a smartphone. At the same time, the individual objectives for smartphone use are also diversifying with the increasing usage rate of SNS (social networking services), meaning we are also seeing a profound qualitative change in use (source: “Communications Usage Trend Survey in 2022,” Ministry of Internal Affairs and Communications). As such, with the smartphone becoming a mainstream device to access the Internet, in the market for various services and applications, expansion into content such as video, music, and e-books is accelerating. Additionally, social media is being used not only for communication, but is also expanding into fields such as payments and purchases. As its influence is growing even stronger, demand for marketing support utilizing the individual characteristics of different media as well as data and AI is also increasing further. Furthermore, internet advertising expenditures in the Japanese advertising market in 2023 reached ¥3,333.0 billion (up 7.8% year on year), exceeding that of the four traditional mass media advertising expenditures (¥2,316.1 billion, down 3.4% year on year, source: “2023 Advertising Expenditures in Japan” by Dentsu Inc.). As such, the COVID-19 pandemic has also been a catalyst for bringing about a massive wave of digital transformation (DX) across all industries, and even in the advertising industry, we have seen further growth in demand for digital marketing.

Amid this environment, despite being affected by the economy, our mainstay Digital Marketing Business acquired new clients, expanded existing businesses, and promoted collaboration with the Dentsu Group. In addition, we have implemented upfront investments centered on strengthening investment in human capital.

As a result, revenue was ¥34,267 million, operating profit was ¥4,949 million, non-GAAP operating profit was ¥5,091 million, profit before tax was ¥6,652 million, profit was ¥4,267 million, and profit attributable to owners of parent was ¥4,319 million.

*Due to a change in the fiscal year-end, the fiscal year under review is the 15-month period from October 1, 2022 to December 31, 2023, and the rate of year-over-year change in consolidated results on a financial reporting basis is not stated.

The trend of consolidated full-year financial results

• Revenue
• Non-GAAP
  operating profit
• Operating profit
• Profit attributable to owners of parent

*1 FY2023 is 15 months from October 1, 2022 to December 31, 2023 due to a change in the fiscal year-end.
*2 The business results of COMICSMART INC. and its subsidiaries, etc. for FY2023 have been reclassified as discontinued operations. Thus, the figures of net sales, revenue, gross profit, operating profit and Non-GAAP operating profit for FY2022 have been revised.

• Revenue
• Non-GAAP
  operating profit