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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Now first we'd like to ask Mr. Sakaue, the CFO, to present as well as to receive questions after the presentation. We have about 1.5 hours as the scheduled time for this meeting. Now I'd like to start this teleconferencing. Please take the floor, Mr. Sakaue.
I'm Sakaue from Yahoo!. Thank you very much for your participation today. As you have been informed, for the first as well as the third quarter business results reporting, we conduct a teleconferencing for myself, the CFO. As it is really hot today, you would not have to come to our office. And also we have a large number of overseas shareholders, and we believe this provides benefits to our shareholders.
Before going into the presentation, I would like to give an explanation as a shareholder on ASKUL Corporation. On ASKUL, to shareholders and to those concerned, we have aroused a grave concern. At the regular shareholder meeting today convened at ASKUL Corporation, a new management team was approved. Under the new management team, we expect ASKUL to as soon as possible, to recover its business but -- and also we'd like to provide our maximized cooperation in enhancing and maximizing enterprise value under the new management of ASKUL. And we also hope that ASKUL will convene a extraordinary shareholder. In order to protect the interests of the general shareholders, we'd like to maximize our cooperation to provide for a sufficient number of new independent external outside directors to be selected.
These are the 5 topics that we have. First, Yahoo! Shopping. In fact, we have seen 20% year-over-year growth of Yahoo! Shopping transaction value. And second, the monthly logged-in user IDs, which is most important, we have for 4 years, or 16 consecutive quarters, of double-digit year-over-year growth. And credit card transaction value was the effect of PayPay itself -- we have a high growth of 49% year-over-year. And fourth, PayPay's cumulative registered users exceeded 9.5 million in August. And also the number of payments per month, which is most critical for us is over 15 million, 1-5 million times in June. And in July, we have tabulated 22 million. Actually, 13.7 million for the -- is the number recently announced by the competition, although we had a certain pay matter or issue, we see a smooth adoption or uptake of mobile payments.
Operating income, in fact, we -- as expected, we see an absence, a decrease. And in fact, annual guidance progress is -- as progressing as planned between 24% to 26%. A summary of Slide 3, which is 2.9% growth in revenue. Operating income negative 24%. However, as on the following page, the primary cause of this was from the absence of extraordinary factors, one-off matters or one-off -- onetime matters.
And also payment -- the equity debt we have in fact, we have posted JPY 10.8 million -- or JPY 10.8 billion, in fact, that was recorded as nonoperating income and expenses owing to the change in equity interest in PayPay Corporation. And also, which is the change of factors on the second line from the bottom, JPY 7.9 billion, which is other revenue and expenses. We had IDC Frontier gain in sale in the previous year and that accumulated, which is in fact a one-off factor that I've mentioned. Others remained the same as anticipated, as I've mentioned. In fact, however, we had anticipated these targets, and we have attained these targets in page -- the next page, which is the current business base.
Commerce as well as payments. We see a smooth growth. Yahoo! service growth has steadily grown.
In other words, by this user base, we can, going forward, there is still a high potential that we believe and are confident of growing or monetizing our business base. And steady progress we see in our business, as I've mentioned in the PL, we see progress is steady, and we don't have any changes in guidance for the full year.
From 7 onwards, slide number, that is -- we have a summary of business segments on Page 8. On the 2 previous reportings, this is a picture of how we're going to grow our business. We will have multiple layers of businesses. We expect to multiply exponentially our growth. Going forward, Commerce business, in part of our strategy as well as performance base is the key driver and we are focused and attach importance to this Commerce as well as Media, for instance, and new business fields -- in that order.
I would like to give the next presentation now. First, on Commerce business on Page 10. This is the business base of commerce. Commerce payments, as mentioned here, transaction value, as you can see, partly shown here have been growing steadily and smoothly.
On Slide 11 is e-commerce breakdown of the transaction value, 8.8% overall, with a growth year-over-year. What we must emphasize is the shopping transaction value is 16.5%. The breakdown is that Yahoo! Shopping grew by approximately 20%.
LOHACO with a negative 6% growth. As a result, it landed at 16.5% growth altogether. Nonsale of goods, we see Travel grew by 27%, up by altogether 20% and Travel grew and led this growth. As well as PayPay, with that linkage, 48.8% of growth in card transaction value -- which is a substantial growth. And to further accelerate growth, we are going to launch 2 services this fall.
Slide 12. First, is PayPay Mall. In the past, Yahoo! Shopping was a mall, in fact, provided no thresholds to open stores. But for PayPay Mall, in fact, those who have only been qualified for listing can put a list and, therefore, it's a premium shopping mall. For instance, home appliances, UX and UI optimal -- optimized will be provided. And by doing so we can provide a user, shopper-friendly environment and experience. As listing fee, we'd like to have a fixed listing fee of 3% for the PayPay Mall as shown here and besides the advertisement of revenues that we expect. And 13 is PayPay Flea Market. We are going to start at the flea market dedicated business. They are different competitors, but YAHUOKU!'s UI and UX issues can be resolved. And by doing so, we believe that we will be able to enjoy further growth. And in terms of flea market, they are different issues to overcome, and I cannot disclose you the details because of the strategic reason, but we will showcase the new service in both. In PayPay Flea Market we'll be maximizing all the lessons learned in YAHUOKU! And the new service will start in fall.
So we have 2 new service releases and there are others to follow. And as you can see on Page 14, in order to achieve double-digit in e-transaction value especially the sale of goods, we are going to put our full-fledged efforts.
Next is Media business, Page 16. As in the case of Commerce, we have a very robust user platform, especially in smartphone area. Page 17. On this platform, we have advertisement revenue and it grew by 2.4% year-on-year. And let's take a look at the individual items.
First, paid search advertisement. Last year, we grew by 2 digits. But in Q1, it remained at the growth of 1.6% level. What are the reasons? We launched a new initiative and CTR improved. However, there was no longer the effect from last year and also PC went down more than we have expected at the beginning of this fiscal year. And third point is related to onetime factor of Q1 -- but some queries we were not able to monetize; that is leading us to lost opportunity. Therefore, the growth of paid search advertising was 1.6% year-on-year.
Next, YDN. It was a negative growth. What are the reasons? There are 2 altogether. From September last year, we started to add fraud initiatives and we had antitracking and these 2 actually contributed to the negativity. And there was a decrease of JPY 1.4 billion because of these 2 factors. And I will talk about antitracking later. Lastly, premium advertising, it grew by 26.9% year-on-year and this is dramatic growth. Regarding YDN, antitracking was one of the negative factor and Page 18 elaborates on the backdrop. As you can see on the left-hand side, as you know, in different parts of the world, privacy protection is being enhanced and many companies are working on antitracking. And because of that, retargeting ads went down. And due to the decline of the impact of antitracking, we were not able to measure ad effects correctly. Therefore, on the right, you see our previous year total advertising revenue. So we have YDN, smartphone and browser or web. The impact of antitracking was felt in this domain the most. What kind of countermeasures are we thinking? It is elaborated on Page 19.
Firstly, what is our strength? We have more than 100 services, and we have Yahoo! ID, and we are going to increase the log-in ratio so that we can target based on Yahoo! ID. And on top of that, we will be able to solicit the users to different Yahoo! services. Cookie is being limited by antitracking, but we do not have to depend on cookie but rather on Yahoo! ID to conduct the targeting-based promotion.
The second point is we have a video application and dynamic advertisements. And as compared to the market, I believe that there is much leeway for us to further grow, especially we have application advertisement that is optimized for smartphone, and we have a dynamic advertisement depending on the user and we will focus especially on these.
On the right-hand side, you see the third point. And there are advertisements with more leeway for growth. And in order to promote the sales, we are going to integrate the disparate platforms. In the past, the platforms were divided so the advertisers said that the budget was very difficult to manage.
But we are going to integrate the platforms into Yahoo! ads. So in terms of awareness as well as application download being the objective of the advertisement, we will be able to expose the advertisement to the right target and also the management cumbersomeness can be eliminated. And depend on the purpose of the advertising, we will be able to cater to the right scheme. So this is the short-term measures that we are thinking.
And Page 20 is mid- to long-term measures. We will create new monetizing models and come up with marketing and product platforms diversification. So we need to have more privacy protection and the external environment will change. And I think that this change will be a continuous one. And antitracking impacted us in a negative manner in the past, but we do not want to follow suit in the future so we are going to further make our platform more robust.
The first one is integrated marketing solution, online commerce ads. Regarding what we mean by this, I will give you an example. Say there are store owners who have their stores in Yahoo! Shopping and we can cater to their needs by having their advertisement on the search result page of Yahoo! Shopping. And also we have peer option and this is within Yahoo! Shopping, but we will have the advertisement in other service pages of Yahoo!. And second point is offline commerce advertisements. This is targeting to manufacturers, so more or less this is sales promotion in nature. The manufacturers have Yahoo! UTOP coupon and the users looking at the coupon on the top page will go to the brick-and-mortar store to purchase that item and payment can be assisted by PayPay. And we plan to have the beta version launch in fall. The third point is on the right, which is O2O solution. So the merchant is our target of this marketing solution. So for the merchant, for reservation and traffic referral, we will be able to provide the right solution through O2O. In the fourth quarter, we would like to raise our revenue in O2O segment.
Please turn to Page 21. For Media business. In fact, if we do nothing, there is a potential that we will see a decline to single digits. The measures that we will take for that -- that I have explained in the previous 2 pages, I would like to actually achieve our initial target of from middle single digit to double digit.
And strategic measures, there are 2. First is PayPay. On page -- Slide 24, as we've shown this in a previous reporting, registered number users, where merchants and payment numbers and name awareness have been in fact smooth. 9.5 million is the number that we passed in August, as I've mentioned already, for registered users. And also we've grown exponentially at a number of PayPay payments. Of course, after the campaign, we've seen some decline but actually we've been raising the base level since. And the campaigns have been appreciated to have them used in daily applications. And in fact, we see for the July, the single month of July, 22 million or more in terms of the numbers that I've mentioned.
On 26 -- in addition to online/offline, we've actually gradually prepared for its usage, Yahoo! EC PayPay usage for instance as well as for, in fact, a transferring to PayPay Bonus Lite what has been the previous usage.
And also on page or Slide 27, the most frequently asked questions, one of them from investors are mentioned here. The first question is, the -- what are the beauty of smartphone payments compared to credit cards and transportation IC, which is all the frequently asked question might be suffice. As you can see on this slide, for merchants, it's a low-payment commission as well as there is no device, store device necessary and it's easier for merchants to adopt. And therefore, as for the user, it could be used more widely, which is the beauty. Going forward, cashless payments will expand increasingly. And we believe this is the highest potential tool in capturing that ever-increasing and growing market.
And second question which is frequently asked is amongst the mobile smartphone payments, there are various choices. And how could we be confident that we will win out of this -- the choice or the selection? We have incentives to actually assume picking up -- in fact, usage is picking up by first having them trying, users try the system and experience it. And going forward, we'd like to strongly penetrate this strategy of using smartphones for payments. For merchants, most naturally, they could use this in marketing and for users overseas, Alipay and Paytm for instance, payments could be the starting point -- going to financing and O2O. Various actions that are related on a daily basis to payments from apps or we call them super apps here, we'd like to grow them into super apps that provide convenience. And we will actually launch various services in a steady manner so there is much more to expect.
And the second strategy measure that we have is to change the capital structure. On Slide 29, on the 27th of June, SBKK or SoftBank Group has been -- has become closer -- further closer. And Slide 30, we are outstanding in the world's information and communications by having a subscriber base and user base as well as by combining that with 5G, which is a new service. We would like to create new services. And mid- to long-term, Slide 31, we have more short-term specific focuses or synergies. In the past, Yahoo! users and Softbank subscribers -- so we have tried to cater to especially the smartphone users, premium members as well as bonus points have been given to smartphone users of Softbank. And by doing so, we have greatly grown EC transaction value. Of course, we will continue on this. However, on top of that, on the right -- you can see in addition, as I've explained or mentioned several times earlier -- that Yahoo!'s marketing products and Softbank's corporate sales power is now going to be combined. Softbank's corporate sales power in acquiring merchants of PayPay has been exerting their exponential sales power that we have noted. And this corporate sales power on part of Softbank when it's backed with Yahoo!, we'd like to further have this link to our advertising revenue growth by combining our marketing products. I've mentioned earlier our measures or strategies -- we'd like to further exert our synergies together with SoftBank's corporate sales power to further achieve the targets going forward. The last page. What we aspire to do on part of Yahoo! is to make our lives surprisingly -- and to a surprising extent, convenient. We'd like to make life -- the online world life more convenient, even more convenient.
Before going to Q&A, some reporters are mentioning that they would like to listen once again to my comment on ASKUL. On part of -- on the matter of ASKUL, to shareholders as well as those concerned -- in fact, their concern has been aroused at the regular shareholders meeting today convened at ASKUL Corporation. A new management team has been brought in.
Yahoo!, as a shareholder of ASKUL, through their new management team, we would like to steadily as well as maximize our cooperation to the early recovery of ASKUL's business performances as well as enhancing their shareholder value.
And also, we hope that on part of Yahoo! as soon as possible, ASKUL will convene a extraordinary shareholder meeting to secure and protect in fact the interest of general shareholders to select a sufficient number of external independent shareholders. And for that, we would like to maximize our cooperation on part of Yahoo! as well. This provides us -- this is what we -- this closes our presentation first before taking questions.
Thank you very much, Mr. Sakaue. We would like to open the floor for Q&A. [Operator Instructions] And upon receiving your question in English, we will have consecutive interpretation. So we need some time for the reply. Thank you. Firstly, Goldman Sachs Securities. Sugiyama-san, please.
I am Sugiyama of Goldman Sachs Securities. I have 2 questions on advertisement business. Firstly, about search, paid search advertisement, in terms of the growth rate, I guess it is below your expectation. And I guess you verbally explained about onetime factor. And I want to know the magnitude of this onetime factor and what is the magnitude of other factors. And heading toward Q2 and onward, if you have any plan for recovery, can you please elaborate on that plan?
Second question. Is it okay if I ask you 2 questions at a time? So a second question is on Slide #19. You have #2 and #3 and these are the areas with more leeway for growth, and you will be integrating the advertisement platform. So can you tell me the timeline, especially video advertisement as well as dynamic advertisement? When do you plan to launch them and what will be the scale that you expect to enjoy?
Thank you very much, Mr. Sugiyama. First question. So we were not able to monetize some of the queries because of some implementation mechanism and this is the impact that is unique only for Q1. And I cannot give you the details but that will be the ballpark figure that I can give to you. And in terms of the outlook for Q2, it will be on par with Q1 level.
And second question about areas with more leeway for growth. Regarding video advertisements in Q1, for PC and others, inclusive, it was about the sales revenue of about JPY 2.5 billion. So year-on-year, there was a growth of about 30%. So trend-wise, PC went down but smartphone grew. And I'm sure that you feel that we are repeating the same thing over and over again. But once again, if I may repeat, we want to grow in this area.
Moving on to application advertising. Frankly speaking, the scale is still small but this is the area that we want to expand. Furthermore, regarding revenue, we are recording some revenue, but I cannot disclose you the details now.
And likewise regarding dynamic advertisements, we already started providing dynamic advertisements although time is not ripe yet for us to disclose you the figures. But revenue-wise, dynamic advertisements has higher revenue than application advertisements. So once we have more diversities of advertisements and sponsors might not understand which will be the right one to go for. Therefore, as written on Page 19, right-hand side, we can integrate advertisement platform, and so that the product can be automatically selected. And so that optimal exposure of the advertisement can be conducted. And so the revenue on the side of advertisers can be secured through this mechanism. So in terms of the efficiency of conversion, I believe that we can contribute to the betterment of the conversion. So -- Yahoo!'s advertisement positive impact will be enhanced, which will have a positive repercussion of enjoying more advertisement from the advertisers. That's all.
I have one more follow-up question. Regarding application advertisement, are you talking about the advertisement that will be shown when you install the application?
Yes, that's right.
From Nomura Securities. Nagao-san, please.
I am Nagao from Nomura Securities. I have 2 questions. The first question is on ads or your advertising business. To sustain your strength on this point, premium ads for the first quarter was very strong. Supporting this growth was e-commerce ads and video ads or dynamic ads. In Q1, do you expect this pace of growth for advertising to grow as well as YDN? There was as a one-off factor, as you have explained. For the second quarter onward, is it likely to turn to a positive contribution -- YDN as well as advertising growth, how much would it be sustained? Which is my first question.
And my second question is on PayPay. PayPay as it grows, back-to-back, Yahoo! cards will also strengthen as you have explained. Another point is on Yahoo! card or the PayPay bonus. It would be most enjoyed by Yahoo! Auctions or Yahoo! Shopping as that would be the most benefit. These 2, I have an impression that their accelerated growth has subsided a bit compared to the previous quarter or for the last year. The circulation or solicitation between PayPay as well as Yahoo! as well as -- how are you going to actually enhance the benefits to users as well as how are you going to grow the number of transactions if there are major strategies? That is the second question that I'd like to ask.
The first question on premium ads. For Q2, 20% or slightly below 20% is the outlook we currently anticipate at this point of time in growth. And for Q1, our sales measures have been very favorable, which is why we have seen exceeding the guidance for Q1 substantially. Of course, for Q2, we will continue our -- these measures, but we -- there are ups and downs. We cannot assure the same to continue. Therefore, we are conservative at this moment to expect the growth of less than 20% or slightly below the mark of 20%. And ad fraud, or antifraud or ad fraud, which is JPY 1 billion of an impact and for Q1, that was the same for ad frauds. And for Q2, ad frauds measures, it was in the latter half of September last year that we conducted this or in September for Q2. YDN is still -- there are lingering effects from ad fraud measures.
We expect this kind of impact to continue to a certain extent in anticrowd measures on the web is likely to also be sustained. Therefore, YDN, it might be a negative of a single digit or around that number. We'd like to actually go to a breakeven point but the Q2 anticipation is that it would likely be a negative single growth rate as well as e-Commerce or EC, which has been favorable.
EC or credit card, we are strengthening sales promotion expenses as -- in whole, it has slightly been declining. Therefore, GDV, GMV, as you have mentioned, Mr. Nagao, was not strong as expected for that. And so PayPay Flea Market, in order there -- are services that attract effectively users to in fact circulate, the 9.5 million users that we currently have under PayPay. How are we going to circulate or connect them to EC as well PayPay Flea Market? We actually have promotional measures. Some of them that we are studying at this moment. We are coming up with this scheme of circulating business. I'm afraid we can't talk about this more in detail right now as a strategy, but I believe we can share the strategies around fall.
There's a quick follow-up I have on 1 point. Yahoo! Auctions also, you expect a profit growth of single digit for the first quarter -- was slightly weaker. And how -- do you have -- what kind of measures do you have on the linkage with PayPay, the Flea Market?
Of course, we will continue on part of Yahoo! group to take measures -- but on part of PayPay Flea Market -- to provide convenience of actually listing your products more easily. I believe on part of Yahoo!, we haven't fully accommodated that customer need. So therefore, by integration, we'd like to accumulate the growth -- is what we think right now. Thank you.
Next, Crédit Suisse Securities. Yoneshima-san, please. [Operator Instructions]
I am Yoneshima of Crédit Suisse credit -- or securities. I have 2 questions. So first question about the Commerce business, I want to understand the comprehensive picture of how it is going. In Q1, I understand that you are seeing some improvements. As mentioned by you, Mr. Sakaue, there might be some efficiency and also Travel and Ikyu, they are trending well. And I want to know -- what are the positive contributors? And also, heading toward Q2 and onward, do you think you will be able to improve your revenue further more? So that's my first question.
Thank you very much. Regarding Commerce, it's not only one factor that is contributing but rather a combination of different factors. So regarding the top line, i.e., revenue, we were able to grow and that was a major positive factor. And the take rate of advertisement of Yahoo! Shopping grew slightly. And also sales promotion-wise, we were able to become more efficient and that is our internal direction that we are heading towards. Thus, we were able to reduce the expense. And because of the combination of all those factors, our revenue and profit are improving. So regarding the Q2, we have [Foreign Language], which is a good shopping day, and there are different events that will contribute. But for the full year, regarding Commerce, we want to improve the profit and that is how we are operating our business. Did I answer your question?
I have a follow-up question. You have Yahoo! Card and are you improving its profitability within Commerce?
You're talking about profit? Profit?
Yes, profit.
So regarding Yahoo! Card, the number of cards are increasing, therefore, the transaction volume increased and some of the transaction is under the revolving payment. Therefore, we have a very robust background in which we can enjoy profit and that already happened last year and that is continuing. And also regarding PayPay, we are acquiring more users to PayPay. And we do not have to only depend on the advertisement over the net. But rather through PayPay services, we can acquire more credit cardholders. So there's a positive cycle.
Second question, and I have a question about a particular service. You will be launching PayPay Mall, and you said that it is positioned as a premium shopping mall. And what is the category that you will be focusing on? And how many merchants do you plan to have per category? And what is the total transaction volume/value that you plan to attain? What is your target figure for the transaction value? So if you can disclose some of your objectives, I will appreciate it.
So, Yoneshima-san, you are not talking about a category cut but rather you are talking about the delivery and cancel and whether we have sufficient inventory or not. So I guess you're talking about the criteria from the point of view of customers and it's very important by that. And needless to say, we need to attain merchants with high transaction value so we have some internal KPIs. And based on that internal KPIs, we are acquiring large merchants.
Excuse me, you have Yahoo! Shopping merchants and are you going to be selective and choose some of the merchants to be showcased on PayPay Mall? And if that's the case, right now, they don't have to pay any commission but with PayPay, you have to pay some listing commission.
Well, maybe the material might be confusing, but we're not saying that we're going to select some of the merchants from Yahoo! Shopping but it is possible for the merchant to only have their store on PayPay Mall. So some of the merchants were not -- were reluctant to have their merchant by Yahoo! Shopping but since PayPay is deemed as premium mall, some of the merchants might decide, okay, if that's the case, we want to have a store on PayPay Mall.
From SMBC Nikko Securities, Maeda-san.
I have 2 questions. I would ask one each. First from Q2 onwards, your expenses for the first quarter, you have started with a decline in profit. And from Q2 onwards, you won't be able to reach the full year target unless you grow your profits. And also from the second half, there are new businesses that you'll start testing. And I do have an impression that the second half, you will grow your profits. How are you going to control and manage this whole process? And from next fiscal onward or next quarter onwards, are you trying -- are there any concerns that you're going to actually invest in advance or prior investments are going to go up again? Do we need that concern again?
Your question was on expenses from Q3 and Q4 of the previous year, not only commerce but in the media. We have had outgoing expenses, which has lowered our profits in various ways, including video. And for our fiscal year '19, we are trying to even out this as a direction of expenses. Q1 compared to the year-over-year is a negative and, though, as an overall plan, we'd like to grow our profits from Q2 onwards for the full year to be accumulated. I'd like to follow up on expenses. Depreciation, it might be difficult to understand this, but IFRS 16 and we have JPY 5.6 billion of -- which is a positive from year-over-year, of which JPY 4 billion around that is from lease or rent that has been reposted as depreciation. So for the whole year round, depreciation would be around 10% or so or is expected to be around 10%. And also sales promotion expenses or sales promotion cost, as I've mentioned, we are trying to make it more efficient. And as a whole of fiscal '18, it was around JPY 80 billion. It will stay on the JPY 80 billion range, JPY 80 billion range. It won't reach JPY 90 billion or JPY 90 billion as a whole of the company. We're going to contain this cost as well. And also personnel costs is another big-ticket item on expenses. Annual total of personnel expenses is less than 5%. The growth rate is less than 5%. And at that rate, we are going to control personnel expenses. 2.4% was the advertising profit and if that is done steadily, we'd have a -- we believe that we have a better base for profits.
From next fiscal onwards, we are yet to fully complete the discussions that are ongoing internally. Of course, our CEO, Mr. Kawabe, has strongly said that we are heading towards growth of not only the top line but as well as the bottom line. That is the basic direction that we are pursuing at the moment.
And the second question is SoftBank KK, your sales, marketing -- corporate marketing power is strong. As you mentioned earlier, part of SoftBank and part of Yahoo!, you have a lot of benefits that you could enjoy with SoftBank. But from the viewpoint of SoftBank, your digital marketing products, what are the benefits that SoftBank could get by selling your products as well as from you, fees, agency fees and that form are you going to pay to SoftBank? And how are you going to actually capture the synergy benefits as well as the revenue sharing or profit sharing ideas? What are they?
We are currently discussing the details. Of course, we will have to pay fees to SoftBank to motivate their sales force, so we would like to actually have a remunerating of fees that would be paid out. And with that also subtracted, we are closely starting to discuss how this could be brought in. We need some more time to actually detail this out. Thank you.
JPMorgan Securities, Mori-san.
The first question is on Page 20. You mentioned about the -- a new business model, and you have online commerce and off-line commerce and O2O. And you want to grow by 2-digit percent and that is the goal that you will be trying to pursue. And looking at performance of Q1, it is a challenging goal. And regarding the new model, from day 1, you should ramp up and the new model should be contributing to revenue. And I want to know when is the timing in which it will contribute to the revenue and what is the scale at the time of ramp-up? That's my question #1.
Regarding the scale, we are experimenting and we only have the beta version now. So we want to get the sales promotion, the JPY 5 trillion market, so that's our aspiration. But regarding the revenue, we are still experimenting so we don't have the concrete figure. And as you can see on Page 20, if we proceed with this as is, it's not included in the single-digit revenue. But then if it ramps up in a positive manner, we will be able to enjoy extra beefing up of our revenue.
So my question is about the contribution of these models in these terms a quarter. And if all goes well, you think that you will be able to get some merit?
Well, O2O and off-line commerce in Q4 are believed and hope that there will be some contribution from these 2 business models.
And second question is on the number of PayPay users. You said that there are 9.5 million registered users so far. If possible, can you elaborate on the concept of active users? I know that you cannot give us any stats, but it if you can give me some image of the active users. And also regarding Yahoo! Shopping fixed-term T-POINT, there will be conversion to PayPay bonus. And in terms of the -- our carrier charge mechanism, it has already started. And regarding 9.5 million users of PayPay, you have a SoftBank carrier and I want to know what is the overall overlap between the PayPay users and SoftBank subscribers.
So regarding the active user of PayPay, we just started this business so we do not disclose the number yet. And a shift from T-POINT has just started so talking about PayPay users segment, it is pretty much the same as the smartphone subscriber. So it's a very good balance. So we want to acquire new segment and young people are using PayPay. So we can actually exploit new user segment, which is quite different from that of SoftBank subscribers.
Needless to say, day-to-day usage is increasing. So if we can understand the equation of dividing the number of transaction by the PayPay users, you will be able to get the active user and I want to increase that. About overlap, so there is not much of an overlap between the PayPay registered users and SoftBank subscribers. Am I right? I believe there is much leeway for growth by having PayPay registered users increase, we will be able to solicit to a new segment. Without that, there is a complete overlap, no.
So the next question from Citigroup Securities, Tsuruo-san.
I'm Tsuruo from Citigroup. The first question is -- the guidance is my first question. The Media business revenue growth was the higher half of single-digit and if possible two digits, which was for the -- what you were intending but 2% is -- was the growth. This is surprisingly low. What changed at the end of -- from the point in time at the end of April? And you have mentioned for the full year, you'd like to achieve the initial target. How are you going to cover up for this? Media business is a high profitability business and this would greatly affect in fact your guidelines. The anticipated outlook would greatly affect your guideline. That is why I'm asking this question.
What was different from what we expected at the end of April? As I've mentioned upfront, YDN as well as search, paid search measures the effect of those measures. We expected that to turn out as strong as the previous year but it was not the case, which is, to some extent, has decreased the revenue. And with revenues coming under pressure to a certain extent, we call hot standby or in fact expenses being stalled for a moment. And in order to achieve the targets that we have given guidelines on. And therefore, we controlled the expenses and, therefore, we at least have seen 25% of progress in profits.
And I have one follow-up. If so at the end of April, so you didn't have visibility on why you have actually not attained at a target this time. But the linearity of the monthly trend, for instance, from April to June, how granular was your insight? The monetize is not possible for assessing YDN antitracking. This effect occurred in May. Therefore, at the end of April, for the single month, it was outstandingly good. So at the point of end of April, we expected the targets to be attained but the Golden Week was longer. And since the Golden Week was over, these events occurred, which has, to some extent, changed the numbers. My second question is on PayPay Mall. This was in a previous question already. The take rate has been improving the pay -- has been improving by PayPay Mall. What is the attraction of -- for the merchants to choose PayPay Mall intentionally? What are the benefits that PayPay Mall provides to merchants in capturing and marketing to merchants?
On this point, as the name is PayPay Mall, 9 million or more registered users of PayPay could be circulated or solicited. So we believe this is a place -- this itself represents a sales potential and for that to realize, we are steadily marketing. And if so, cannibalization with Yahoo! Shopping as well as the site -- the confusion on part of users, there are a lot of concerns that I have on execution.
How far have you thought this out at the moment?
I believe for general users, we will try to give them an easy-to-understand way and EQ and Yahoo! Travel is close to the relationship here. EQ is so-called PayPay Mall and Yahoo! Travel is Yahoo! Shopping, so to speak, in travel. We will have a clear demarcation between the two. Both are making profits or growing their profits. We believe the same could be applied and one other example is Tmall and Taobao from China. They have actually clearly separated their targets and therefore, we had expected more cannibalization, but we are taking these prior cases to provide more reference and insights as a result. Both have grown as well as the total amount has grown even more, which is what we will try to achieve. Thank you.
Astris Advisory Japan, David Wilson (sic) [ David Gibson ].
It's David Gibson from Astris Advisory. On PayPay Mall and PayPay flea market, could you just elaborate? Apologies if I didn't understand. Are they separate apps from PayPay or they're services to be offered within the PayPay app itself?
They are separate from each other. They are separate apps and they don't cohost. They are separate services.
Could you elaborate on why that's the choice? Why do you think that's the best solution rather than offer it within the PayPay app itself and have to drive new users to download, new users to install?
I think your question is PayPay Mall and PayPay flea markets, we believe there are slight differences in the purpose of using. PayPay Mall is more of the sell side and PayPay flea -- PayPay Mall is actually wanting -- users wanting to buy new products or items. So therefore, the targets are different. And we believe we can do that by separating the apps. And installment facilitation is by using PayPay, we can have more broad and seamless user download apps providing more incentives. And by doing so, we think we can steadily manage that.
Okay. And can you just talk about competition? Obviously, 7pay has had issues. Initially, when 7pay and Family Pay launched impact PayPay usage go down and then now has benefited given PayPay -- sorry, 7pay is having problems and will be canceled?
Family Mart payments or other payments has made market entry. But continuously, PayPay has actually smoothly grown by capturing different category of users. This is not cannibalizing on existing pie sizers. The payment market is growing exponentially and all of the competitors are getting more out of a growing market. So we don't expect any severe negative impact from specifically Family Pay or 7pay. 7pay had various problems but this has not been a tailwind especially or specifically. Without that, we have been steadily growing.
Then let's move on to Iwasa-san of Mizuho Securities.
I am Iwasa of Mizuho Securities. I have two questions. First question, on Page 31, you mentioned that you're going to use the corporate sales power of SoftBank. And regarding the marketing and sales advertisement, you have to understand the nature of the advertisement and you need to report the impact of the advertisement. So expertise knowledge is required, I believe. And in terms of SoftBank's corporate sales power, are there specialists who are well-versed in advertisement? Or do you plan to conduct training to them so that, as time passes by, you will be able to enjoy the positive impact of their activities?
You are right, Mr. Iwasa. So in terms of selling of the advertisement, it's not simple. It's more or less like a solution sales. So we have to think about that. Having said that, SoftBank has relationship with top clients in Japan. So that's another aspect that we have to bear in mind. And so we would like to leverage on the relationship that they already do have with the major clients here in Japan. So we are trying to come up with the right flow.
Second question. Please turn to Page 25. You mentioned that the number of payment by PayPay is growing steadily. How is it being disseminated amongst the consumers? For example, when you launched PayPay, maybe the ratio between male and female might be on par with the population mix. And also age-wise, maybe you're expanding the age range. And then more frequently, PayPay is used for payment, the amount of payment and the number of merchants may be -- these 2 are growing as well or maybe there might be some inclination to a particular segment. So if you can tell me qualitatively speaking, how is the usage of PayPay increasing?
So regarding user segment, say, the breakdown of smartphone or breakdown of population of Japan, we do not have any inclination one way or the other. So we are well-balanced. So in terms of payment amount, drugstore and convenience stores are the major merchants where PayPay is being used. But other category merchants are accepting PayPay. So we are seeing a widespread use.
So in terms of the payment amount, do you see any changes as time passes by?
So in the first campaign, the unit sale was different, but I don't think we are disclosing number. But there is not much of a difference in the unit payment that is being made. So it falls within the range. So simply put, it's a day-to-day usage payment amount, so that's the average ticket price.
So the next question is from Mitsubishi UFJ Morgan Stanley Securities, Araki-san.
I have one question. Slide 20. My recollection tells me at the previous meeting, the slide at the previous meeting, the third quarter or the fourth quarter was the launch of ads and here it says that O2 is Q4 and I feel that this is being set back. Is that true or not? Just one point I'd like to confirm on the time line of the launch.
The previous explanation might not have been full enough but Q3, I think, was the integrated marketing solution that we have started to test marketing. And Q3 and Q4, I think, in some way we've launched. So it's not just not omitting Q3 and Q4. It is not intentional actually because this is being test marketed for online commerce Q3 and Q4. And off-line commerce is going to be a beta version to be launched or released in fall in the third quarter or Q3.
Merrill Lynch, Jason Mitchell.
I just had a question on how you're thinking about the consumption tax and impact to your e-commerce business for the year. If you see a slowdown in 3Q, do you think you can get to your kind of growth targets for the year? And then -- or is it dependent kind of on the successful launch of the PayPay e-commerce apps? And then my second question is just kind of a housekeeping. You made a change to how you report auction GMV. Could you just explain why you made the change and where that GMV or revenue got shifted to?
The first question, consumption tax in October will be hiked. For Yahoo! Shopping, we expect last-minute buying sprees first. And by that, we will see a growth potential upward for Q2. Regarding Q2, 20% or more shopping GMV is what we anticipate and -- which is likely to be attained. And with -- after this last-minute shopping spree, the governments to promote cashless payments, bonus points in various ways will be provided from October onwards. And in Q3, we will see a lot of tailwind in many ways for commerce. Though this quarter was still weak for a sales of goods total, for the second half, we expect close to 2 digits, which is the answer to the first question and the second. [ For starters ], GMVs in Yahoo!, we have actually shifted the posting of items. It's not necessarily -- but we brought that out and it has been reposted to another item but the number itself is nonexistent. And for the past numbering from this reporting, we have actually retrospectively done all of the reposting. Does that answer your question?
Yes.
So the next question is from Ace Economy (sic) [ Economic ] Research, Sawada-san.
I'm Sawada from Ace Economic Research. I have 2 questions. First is on PayPay Mall. If the merchant actually fulfills the criteria and the criteria itself has been brought to a higher level, has been elevated to a higher level and there was a criteria that -- like to a higher threshold and, therefore, you didn't have listing of products in the past before it was free of charge. And, therefore, could you give us a background on how we could get an insight on how it works?
Well, from the past, so what we know from the past is that we -- I think I feel at least that we didn't have a criteria of the kind that you have mentioned. Yahoo! was more media, but we see more acceptance on a batch basis right now and the PayPay Mall's merchant acquisitions. There are certain individual users as well. And by having that message communicated out, I think we can steadily acquire merchants. Does this answer your question?
Yes. The second question is PayPay flea market, the app might be similar to an auction app but might be slightly different. The flea market app, what are the core values? Could you give us more insight on that?
Flea market apps relatively speaking, for buyers, you get a discount; as well as for sellers, you can, in a shorter time frame, can sell off what you have listed, which is the demand on both sides or the wants on both sides. Auctions, you will have to bid up; and for sellers, it's more of a platform to get more value out of what you're trying to sell from enthusiasts or people who appreciate that and actually buyers could actually come across products that you wouldn't see anywhere else. So we have this difference. In fact, the growth is the single digit or the first half was lower single digits. And therefore, for Yahoo! Auction, I think at the flea market, we'd like to satisfy the needs that are different from the auction platform. Thank you. Thank you for your question.
[Operator Instructions] So it is almost 5:30. So last question. Tsuruo-san of Citigroup Securities.
This is my second round and I have one more question. Question is on LOHACO. So it's minus 6% between April and June. And ASKUL, I know that news release has been provided. And given the backdrop, how did you reflect LOHACO in your guidance? So GMV did not increase and in your case, this is negative contribution. So how should we think about the assumption going forward? Not only LOHACO but ASKUL in totality.
ASKUL as a company has the FY ending May 2020, and they have announced the figure and we have incorporated that within the guidance of Yahoo!
I see. Okay. I guess time is not right for me to talk about the future of LOHACO/ASKUL so I will end my question here.
It is almost 5:30. So we would like to close the Q&A session. So Mr. Sakaue, would you please give your final comment?
So this was our first endeavor to have the teleconference, and thank you very much for staying with us for a long time. And I do hope that you will continue supporting us. This concludes the performance briefing. Thank you.
[Foreign Language]
[Statements in English on this transcript were spoken by an interpreter present on the live call.]