The following is a summary of the Recruit Holdings Co., Ltd (RCRRF) Q2 2024 Earnings Call Transcript:
Financial Performance:
U.S. HR technology division exceeded initial expectations as revenue per paid job ad increased over the decline in the number of paid job ads.
Full year guidance revised; lower limits of ranges significantly raised from previous estimates.
Net cash and deposits as of September 30, 2024 were JPY 756.6 billion, a decrease from JPY 1,135.4 billion as of March 31, 2024.Share buybacks executed extensively, with 80% of the maximum total purchase price of JPY 600 billion utilized over 4 months ending October.
Business Progress:
Transition to Indeed PLUS in Japan is progressing, albeit slower than initial expectations with complete transition from PPP advertising model by end of FY 2024.
Plans for HR Solutions business in Matching & Solutions to be transferred to HR Technology segment starting next fiscal year.
Staffing growth revenue in Japan is expected to offset by the performance in Europe, U.S., and Australia.
Opportunities:
Continuing transition to Indeed PLUS enhances platform capabilities and may increase revenue as it integrates existing job board businesses in Japan.
Strategic reorganization, transferring HR Solutions to HR Technology segment, expected to enhance operational efficiency and business clarity starting next fiscal year.
Risks:
Persistent decline predicted in the number of paid job postings in the U.S. expected to continue until the end of the current fiscal year.
HR Technology expenditures and marketing strategies in the second half may not lead to immediate profitability improvements.
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