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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Good afternoon, ladies and gentlemen, and thank you for joining Rakuten's 2022 Second Quarter Financial Results Meeting. We have disclosed the latest consolidated financial reports at 3:00 p.m. today. You can view this data on our corporate website's page for investors, along with the presentation documents used in this meeting. Please allow me to introduce the speaker, Hiroshi Mikitani. First Mikitani will give a presentation about the latest financial results. Mickey, please.
Can you hear me?
Yes.
Good afternoon, ladies and gentlemen. There have been some staff members that have been -- have contracted COVID-19. And therefore, this is an online meeting that we have arranged at the last moment. I hope you understand. So without further ado, I would like to start the second quarter financial results meeting of Rakuten Group.
So first of all, highlight of the earnings, and then I will update you on the progress made in the different segments. So highlight of the results for domestic EC, e-commerce, very steady, very favorable, especially in U.S. and Europe. Other global EC companies are actually struggling for the most part. But for our group, plus 12.3% year-on-year growth was registered compared to pre-COVID period, 17% CAGR growth has been registered every year. And on a global level, Rakuten Rewards, Amazon and other companies have been struggling during this period. However, our GMS has been quite strong. So including payments, plus 23.9% year-on-year, almost 24% is the growth that we have registered for Global GTV.
And fintech, card, bank and securities, all these fintech companies had a steady growth in terms of the cardholders as well as accounts. Card shopping, especially, by far, we are the #1, 28.8% growth year-on-year. And for mobile business, we will come back to this, but we have cost structure that is highly efficient. And new technology is leveraged that is really opening up a new horizon for the new era, and it is running stably at a very high performance level. And so Rakuten Ecosystem is being leveraged, and that is very good in terms of winning new customers. Therefore, in the future, we will become the #1 Japanese mobile player. And of course, we will go overseas as well.
And for key KPIs, Global GTV, as I mentioned already, JPY 8 trillion. So about almost 24% year-on-year growth. And domestic e-commerce GMS, JPY 1.3 trillion, so plus 12.3% year-on-year, and consolidated revenues, 13.5% year-on-year. Excluding mobile, 12.6% year-on-year for non-GAAP operating income, that is JPY 45.2 billion, so very steady. And for Rakuten Card Shopping GTV plus 28.8% year-on-year, for Rakuten Card Issued almost JPY 30 million is in our horizon, in our view, 15.5% growth year-on-year. And Rakuten Security General Accounts, it's over JPY 8 million. It is actually JPY 8.05 billion, which is a growth of 28.9% year-on-year. So Rakuten Ecosystem is leveraged in order to increase the general account numbers. And 15.4% year-on-year percentage growth for Rakuten Bank Accounts, so almost JPY 13 million now. So very steady growth here as well.
Now I would like to focus now on the e-commerce part in Japan, 13.2% sales growth and 30.4% growth. So this is the operating income that we have increased and a 17.4% increase in fintech. So operating income, JPY 26.5 billion. For mobile segment, deficit of JPY 124 billion. And so this will be bottoming out this term or this quarter. And from here on, there will be improvements made going forward. Excuse me. So network coverage first. Already we have 4G, 48,000. And by year 2023, it will reach 60,000 stations. Population coverage, 99% or higher is what we are aiming for, and we are on track towards that. And finally, Rakuten Mobile, there has been some major failure or faults in other carriers, and there have been other cases of such failure. But the question then is how can -- why are we Rakuten Mobile have such a stable network? How is it designed to enable that?
Let me explain that just a little bit. There are 4 parts to that. One is redundancy in the structure. We're using the cloud. Therefore, this is easily done for us. And everything is using software. Therefore, all the components and their performance can be monitored real time and visualized real time. So monitoring is done real time. And the third point is virtualization. So various software might go down, but replica can be made very easily. And a human intervention is to be minimized as much as possible. That's our basic stance.
And so in building Rakuten Mobile network, we have focused on 4 primary areas to provide the level of reliability and resiliency that is unparalleled in the world. Number one is redundancy. Our network runs on common hardware appliance, and it gives Rakuten Mobile unbelievable ability to replicate hardware architecture across all network function. Number two is observability. We are one of the few mobile operators in the world that have the ability to provide near real-time latency to observe thousands and hundreds of thousands of network functions in our network. Number three, which is the major technology revolution that we have done is virtualization. Through software virtualization, we're able to manage complex network architecture, manage resiliency and deliver better reliability than the existing mobile networks across the world. And number four, our relentless focus on automation, machine-driven AI ML models to do configuration and changes in the network, avoid any manual interruption that could happen due to human error. We think this level of reliability does not exist in any of the networks worldwide. That's what makes this network unique, and we think this is the right DNA and architecture for the quality of Rakuten Mobile in Japan. Thank you, Mickey.
Okay. So later, if you have any further questions about this part, please do ask later. And as you might know, 1 gigabyte or less used to be for free for those users. However, as of September 1, that 0 charge will no longer be the case. We are finishing that campaign. And by the end of October, that will be totally gone. Well, as of now, in September, on a per user case basis, monthly sales will be improved by more than 50% compared to before. In addition, on a per user basis, the ARPU, of course, will be increased via expansion of option plans as well as expansion of content services. So these are some of the measures that we're planning on carrying out to improve the ARPU. So we will come back to mobile later. So let's move on. So the -- as for the segment profit comparing to the previous quarter, JPY 11 billion improvement was made. And then the last quarter was bottom. And then we are going to improve our profitability as we move forward in the next year, and we want to make profit in a single month, and that is what we are aiming at. So before going to the mobile, I would like to talk about the domestic EC and fintech. And as for the domestic EC, as I mentioned earlier, so comparing to the year before, we have grown probably 12.3% in the domestic EC GMS, which is JPY 1.315 trillion. And then more than that sales growth -- sorry, more than this GMS growth, segment revenue grew higher and which is close to JPY 200 billion. And today, it is JPY 190 billion. And among that, so looking at the segment operating income, it is JPY 220 billion, and then the growth higher than the GMS and it must be higher than GMS. That's what I usually talk, and this is a golden formula. Now we are realizing that.
And let me detail on each business in the Rakuten Ichiba. All retail industry has been struggling. However, compared to them, Rakuten Ichiba grew much higher and the Rakuten Travel. So the COVID -- well, we see some BA.5 and it spread again. However, comparing to the peak time, 2.2% reduction, and that is the recovery we made so far. And as for the net online supermarket, well, it's performing pretty well. And then Rakuten Fashion. So the department store and the supermarket and also the specialized stores comparing to them, the fashion business is growing pretty well as well. And then Rakuten will cross-use is the point. So Rakuten EC business, the cross-use within the Rakuten EC is growing, Rakuten Ichiba and the travel and the users are using both the services has been increasing by 56.4% and then the Rakuten crossed Rakuten online supermarket by 30.9% and the Golf reservation side, GORA and Rakuten Ichiba grew by 15.1%. And then hair salon, beauty salon reservation can be made with Rakuten Beauty and with Rakuten Ichiba combination is 13.4% plus. And then Rakuten Fashion and Rakuten Ichiba cross-use grew by 10.6%. And let me elaborate travel more. So today -- so domestic, the total reservation, the travel night, the more over 20% made through Rakuten Travel. That's our impression. So 2019, which is a pre-COVID period comparing to pre-COVID period, the reservation rate went up by 14.0%. So about 25% sometimes. So this -- the travel night share above the -- around 25%, we already achieved. And then now there is a registration of the seventh wave of COVID-19. So we have to monitor closely, but we like the profitabilities of the registration, mainly on the leisure. So if we see more recovery, then this will become much stronger.
And the next is about online supermarket Netsuper, and probably, I think we have become one of the leading companies in this area. And then GMS is 14.6% plus Y-o-Y basis. And particularly, so what we jointly created with Seiyu was a logistics center and shipping from here, just focusing on that is 43.6% plus Y-o-Y. And then the goal of the GMS, which will be JPY 100 billion in 2025. And comparing to that goal, I would like to improve the profitability of the business from here. And now the logistics center, we have Kashiwa in Chiba and Yokohama in Kanagawa and Matsudo in Chiba Prefecture. And also this year, Ibaraki City in Osaka, we have expanded our logistics center. With that, the national -- nationwide supermarket, we are providing platform to support that.
And the next is about fashion. So from people refer to ZOZOTOWN in this area, in Rakuten Ichiba and Rakuten Fashion combined 2 of them. So the fashion-related GMS total is JPY 266 billion and then which is about to reach JPY 300 billion soon. So not just the scale, but also we are sustaining the growth rate. So in the fashion industry, so Rakuten's presence becomes stronger. So next is about the logistics. So this is a joint venture with Japan Post. As a result, so we can utilize the existing JP network and then provide services as a universal service that's ready and the Rakuten Super Logistics. So this is our logistics warehouse and there are -- more than 5,000 merchants are using this logistics. And then we have to reduce cost. So far -- so we tend to use the existing Japan Post system on the logistics. But recently, so JP GP Rakuten Logistics warehouse, which is the RFC. So we are direct -- make a direct delivery to the delivery station, which allow us to reduce cost substantially.
So the biggest growth factor is what are we able to maintain this kind of growth rate, and that is the adoption of the free shipping threshold. So now 93.3% of the merchants adopted this free shipping threshold. So our target was above 95% adoption rate. And once I think we want to achieve this before the end of this calendar year, this 95%. And then as for the shipping other cost, it's improving in the Rakuten Ichiba, I should have touched upon this. And then the merchants who have adopted this comparing to those who do not adopt so 17.3 points growth rate become the different between those 2 different type of merchants. And this is one of the biggest growth drivers of our businesses. And other Internet services, particularly Rakuten Rewards. So it's performing pretty well and the revenue has grown by 18.2%, which is about JPY 70 billion. Unfortunately, as you know, Ukraine situation, Ukraine/Russia situation due to that in Viber, we actually have the 98% penetration rate of the smartphone users in Ukraine, the driver in last year, well, many users are using this river, however, from these dimensions our anticipated revenue would not be generated given the situation. So we initially assumed a big profit from here. However, February and onward, we were not able to generate revenue from here. And if this is excluded, and then it should be about JPY 300 million above comparing to the previous year. So we would see some resolution for this duration. And the next is about the investment business and Rakuten Capital and venture capital is conducted under this Rakuten Capital and comparing to the competitors, maybe the scale is very small. But about JPY 140 billion investment was made. And then the exit amount is about -- about JPY 190 billion and the remaining -- although the market is down trend, we still have JPY 108 billion. So our basis, is above 20%. So in terms of our investment business, we see a steady progress even under the challenging environment today. Next is FinTech. So Fintech segment highlights, 6.3% increase in revenue and a 17.4% increase for the non-GAAP operating income for this segment. And the golden formula that I talked about is at play. Unfortunately, when you think about GTV, credit card is steadily growing. And so it's not included in the Golden formula, but 6.3% increase in revenue and a 17.4% increase in the operating income. So about JPY 26.5 billion. So I would say Rakuten Card Shopping transaction value is doing very, very well, 28.8% year-on-year increase. So JPY 4.5 trillion almost. That is really, by far, the largest number, I think we can share with you. And in the 3-year period on a continuous basis, 25.5% increase CAGR has been realized. So not just e-commerce, but daily necessities, and also housing related or habitation related businesses are on growth. And I think the true worth of Rakuten is a combination of off-line and online, and we are really leveraging that and the results are being showing here.
Now Rakuten [ Ginko ], we have announced that we will list this, and we have announced a mid- to long-term vision as well in March this year, 12.3 million is the number, but 15% growth is expected to reach approximately 25 million, and deposit balance from JPY 7.7 trillion to JPY 20 trillion is the target. When we purchased e-bank, it was several JPY 100 billion, I think that was the cash -- the balance back then, but it has grown so much. So I think there's a lot of potential for further growth and ordinary profit. In the Q3 2022, it was about JPY 106 billion, but it will reach JPY 200 billion approximately. That is the ordinary income and 20% increased CAGR is expected or the target is that for ordinary profit to reach approximately JPY 70 billion. So for Rakuten Bank, for the results of the quarter, I think this is being announced or disclosed on a separate occasion. I hope you will take a closer look at it, but I can say that it's growing very steadily.
Next is Rakuten Securities. So 8.50 million accounts, plus 34.2% year-on-year growth and domestic equities retail trading market share in Japan is shown here, and the share is already at 33.5% compared to last year, that is an increase of 6.6 points and asset under management JPY 16.5 trillion. So again, year-on-year growth of 28.8%. So the top position has been acquired, and we would like to expand the gap with others. Rakuten Insurance Group. Digital transformation, DX is being promoted. And profit wise, we have been growing very steadily. And for fintech, well, on the surface, should I say or not, but the balance sheet overall for the entire group is getting larger and larger. That's one fact. And also, the more capital we have, the more potential that we have for increasing our revenue and profit and income. So for Rakuten Bank, already in July, that is last month, we have applied for listing of the shares with the Tokyo Stock Exchange. And for Rakuten Securities Holdings we are already preparing for the IPO. Therefore, basically, in the middle of -- or during next year, we are targeting for an IPO. So next is mobile. So as mentioned at the beginning, so the first one is about the cost structure, the world's first fully virtualized technology, and I will touch this upon later in Rakuten Symphony portion. And the information security has become really important today. And this is drawing attention from the world, Nokia, Finland and Ericsson, Sweden and Samsung, South Korea and Huawei [indiscernible] China. So when it comes to Japan and U.S. so the Rakuten Symphony have the U.S. technology. I think you can think in such a way. And with our technologies, so we are trying to do software, and we have made that happen. In the Rakuten Group, customer acquisition power and also the increasing the network coverage, which is high quality. So we have been realizing this and with the Rakuten Card business and the card industry has become overwhelming #1, so we would like to follow the same path in this mobile industry.
And Rakuten Mobile, with the entrance to the market, all the smartphone at the price has become decreased as we move into this market. So Rakuten Mobile, we want to democratize the mobile market. That is what we are aiming at. And then what we announced in July, which is UN-LIMIT VII. And this is a big strategy turning point or the evolution in other words. So 2.5 years ago, we just started. Rakuten Mobile just started 2.5 years ago, and we have to have a user. We need them to use our services. And also in order to export symphony technology, it is needed. Therefore, we came up with really the board pricing strategy to that end. And these are JPY 0 users, and we had many of them, but we decided not go with this. So basically, the 3 segments we want to focus. One is Rakuten Group Ecosystem who purchased items in the Rakuten Ichiba and using the Rakuten Card, we have many of them.
So we would add a point to this so that we can strengthen this loyal ecosystem users, including myself, many users, many people used the point acquired in loyal -- acquired in Ecosystem and pay the mobile fee. So many of them are actually using mobile as a service for free because of using the point. And other than JPY 0 users, but they can become the smart users and the people who use more than 20 gigabyte data or actually, there are more users using about 100 giga users. So Rakuten Ecosystems for your customers and also smart users and then the heavy data users. So these 3 segments will be our target to increase ARPU.
And then price advantage, and we want to improve the quality much more than the marketing strategy, and we will try something new. So MNO, among 4 MNOs, our price is very low. And then after that, there are MNOs sub-brands. But in the most price range and Rakuten UN-LIMIT VII is overwhelmingly the low price. So using the heavy data users. For heavy users, Rakuten LIMIT VII, which is a single plan, it's easy to understand so that must, let's say, so the download a very sizable game, but usually, they use 7 to 8 gigabytes. So it is quite attractive because they don't have to think different range of the prices. Therefore, in this context, we are democratizing the price. And how much data has been -- how much data is used. The other company's average is about monthly 9.3 gigabyte. That is the average of other carriers. In Rakuten Mobile, which is 14.4 gigabytes and then the data person is increasing. On the right hand, this is about the estimation. And this was provided by MIC and the total data usage will be changing. So the more data used, the higher the app. And cost structure comparing to the existing technology initial CapEx, 40% reduction and OpEx, 30% plus reduction, we have achieved this. As for the quality, so this is provided by umlaut, the investigation results -- research results data. So comparing to other country's network situation, our network quality is very high. That is how we are evaluated by this umlaut research.
On the other hand, we need to strengthen the connectivity of indoor. And then Rakuten Casa, which is the [ connector ]. And now we are installing them and actually 850,000 Rakuten Casa was installed. And so we would like to cover higher than 100,000. And then as for the high forward, skyscraper, we see some weak network connectivity. That was the feedback we received. So the high-rise buildings over 20 floors. We want to use antenna outside the building to cover the network connectivity. And as for subways, so we are straining here. About the 95% is already supported, but we are going to support 100%. And then the next spring and onward as for the capacity, we would like to expand sequentially.
And then CapEx, 2021, as you can see from the diagram and the basic -- the CapEx was the JPY 350 billion. And then the right-of-use asset was JPY 147 billion. And then about the capitalization for specified base stations, which was JPY 47 billion, but we have been promoting or progressing. So this investment amount would be reducing and this year is about JPY 300 billion. And the 2023 and onward, it will be decreasing. So this chart is one of the very important chart. So this is based on the application. So this does not include churn. So as for Tokyo23 wards, we've already achieved 9.4% of the application rate. So 9.4% of the Tokyo23 wards population subscribed to Rakuten, but the coverage is still 85% of some areas less than 5%. So the station would be going up to 60,000. So in each of the prefecture, we want to cover around 99%. So this is a hypothesis.
If that is the case, and then this application rate would get closer to 12 million people. So this is a very important point. So we've only getting to this business 2.5 years. And I think we have been doing well so far. And then once we achieve the 60,000 base stations and then according to the application, the basis, we want to reach this 12 million people. As for the marketing, so far, we have been targeting the entire nation. However, we would like to strengthen the region-specific marketing and we did a test pilot in Shizuoka, Toyama and Ishikawa, and we see the application rate increase by 24% to 23%. So the advertisement inside the train and also the hosting events, including these activities where we have been approaching the nationwide, but we would like to conduct the region-specific marketing as we move forward. So I talked about synergy with the Rakuten Ecosystem. I think this is very important. It used to be 0%, but then it has grown to 11.9%. In other words, that much people are using Rakuten Mobile, and we would like to bring it up to 30%. And I think that is not unrealistic. It is something that we can envision. And synergistic effects. As I mentioned many times, Rakuten Mobile subscribers, once they become subscribers, a little more than 50% of them actually -- well, likely to purchase in Rakuten Ecosystem or rather 40% increase rather. In any case, Rakuten Mobile subscribers, if we get 10% of the total population, then it's 12 million and then a 15% increase in GMS in Rakuten Ichiba is expected as a result. The mobile is, therefore, a prime program for Rakuten overall.
And for -- and among the new users, 21% of them are coming in through the Rakuten Mobile channel, so to speak. So for continuous growth into the future, Rakuten Mobile will hold the key. And so what specific services do they use? Rakuten Mobile users or subscribers tend to -- well, actually, for these users that are new to Rakuten in the first place, 60% of those Rakuten Mobile subscribers buy in Rakuten Ichiba, 40% use Rakuten Point Card and 20% of those people hold a Rakuten Card now and start using the card. So in 1 years' time, more than 3 services are used by the same person. So what we have targeted was such that it would be reverse of the mobile strategy until recently, but I think this is paying off.
Now you might be wondering or concerned about the next item, and that is churn. How many have left us? Well, for those users that used to use less than 1 gigabytes, yes, it is true that there has been some increase in the churn amongst these users. However, about 80% of those people who churn, data usage for them was less than 1 gigabyte. In other words, JPY 0 users are 80% of these people. And also, there are some areas where coverage is not perfect. So -- but we are making improvements and resolving that issue of coverage. Therefore, that will be gone soon. And for the paying customers, there is a net increase in such paying customers. What I'm trying to say here is there is this shift to paid users. So cost wise, this is a plus and also profit wise, it is -- it makes a whole lot of difference.
And UN-LIMIT VII was disclosed. And then after that, there are 8.3-point increase of the people who are using Rakuten Mobile as the main line and also heavy users using 20 gigabytes or higher has increased by 5.7 points. In other words, they are using independent Rakuten mobile in earnest. And the group challenge going forward is how to win young customers. And again, there is a growth, 8.5 points increase amongst those young segments, 20s and 30s. And these young people tend to use a lot of data. Some people might use 100 gigabytes or higher. For these heavy data users, JPY 2,980 per month is what we charge. But in other carriers, it might be JPY 15,000 or JPY 20,000 that the carrier might charge them for the same amount of data, but JPY 2,980 is what we charge.
Software is what we use. Therefore, new things can be tried. eSIM, for example, Rakuten Mobile can be activated in about 5 minutes. There were some major failure in other carriers. And so second line might become a necessity for some people. So activation on the same day of application. So eSIM is also very important. If you have 2 lines, of course, Rakuten Mobile will be less expensive. So make Rakuten Mobile the main line is what I would recommend everybody. And Rakuten Carrier E-mail is already started. And also officially from October, we're starting these services for enterprise customers, but POC is already started, and we are steadily winning new corporate or enterprise customers.
Now going forward, to accelerate winning new customers, number portability is done through 2 steps or 2 stops. In other words, you have to go to the older carrier to apply for this switchover. But then led by the Ministry of Internal Communications, MIC, it will be switched to a one-stop mobile number portability procedure. And this is a data on churn. And of course, before July, there were JPY 0 users, but they left us. However, that has settled quite a bit already. And in November this year, or by November, it will go back to how it was before. And also, there will be less churn going into the future.
And as for the profit and loss, as I said before, quarter 1 was the bottom. And as we promised you for Q2, we have improved by JPY 11 billion. And so there are some elements for improvement -- further improvements. The so-called [ area ] services is now stopped. And there is expansion of option services and that is doing very well and also improvement in network translating into subscription, acquisition and 6% to 7% of the total traffic is through roaming, but 5 gigabyte is the maximum, the upper limit. And that is one factor behind but we are expanding our own Rakuten network. So there will be no such upper limits and roaming cost will be dramatically reduced as a result as well. So these are the factors. Last but not least, Rakuten Symphony. So draw your attention from global market. In 2019, world first fully virtualized cloud-native network was launched and run on software in other words. Along with that we acquired Innoeye. So this is a network management or design software and operation. And then Altiostar mainly for the base station. And application-related things or sign-up experiences, which is done by Aquafadas, and then the various applications, including link to mobile operators, Estmob. In the last year, edge cloud architecture, cutting-edge the company Robin. These companies were acquired. As a result of -- this is a great chart. So maybe it might be difficult to understand through the investors' point of view, but usually operated outsource to other company and partner with them to work.
However, in case of Rakuten Mobile, Rakuten Symphony, so they have almost full stock of the software and then achieve high-performing solution. So this is one of the biggest thing that we can highlight and cloud network and various software to be linked on this Symworld platform and to users, let's say, charging to users or customer handling interface. So digital experience are -- now it's enriched. And then the overseas like AT&T, are paying attention in this intelligent operation, and they are actually using this intelligent operation. So this is the SaaS or software network and the player who can represent Japan. And I think we have become that position. Well, today, about 115 pipeline we have and the existing customers is 13. Among that 1&1, this is a German company, and they have -- they are using the Rakuten technology in end-to-end. So this is a big project.
In other words, this is the pipeline by region, diverse existing customers in pipeline by region. And just for your information, just want to run company -- so the real test, friendly user trial started. Software, openRAN in a real contest commercialized basis, this is the world's first case, I believe. And then they have achieved this speed, which is 1 gigabit per sec. And latency time, maybe 3 milli sec. Unbelievably -- unbelievable speed was achieved through this software architecture where sometimes when we -- investors ask, what is about the Rakuten Symphony's technology, they inquire us and from my point of view, so we have a great cost efficiency and the performance. And then AI led stable operation has been achieved through this technology and overseas in the content business.
As you can see from here, Rakuten TV, we have about 60 million users and plus 64% Y-o-Y and VIKI, this is also a profitable business and the number of registered users, plus 32.6% Y-o-Y, which is about 60 million and the KOBO, about 60 million and Viber, about 1.4 billion, and particularly these days, we see a good performance in Southeast Asia. However, unfortunately, Ukraine, we -- the revenue is not growing, although the number of users has been increasing, but we have to understand the situation. And the Rakuten Rewards, and the GMS plus 5% in the Q2 was introduced to the analyst already. So obviously, the U.S. major EC providers are struggling. However, as for the Rakuten Rewards, we grew steadily. And the last but not least, sustainability ESG is a topic before closing the presentation.
So the United Nations Global Compact, we joined this. And the second one is the Ukraine humanitarian aid already as a donation, it went beyond JPY 1.3 billion, and that we made this amount of the donation already. And then we have been selected as a constituent of global major ESG indices. So this is a social responsibility as a company and also all the pride of our employees and also the branding to our end users. So including this, meaning this is really important to be selected as a constituent of global major ESG. So on a continuous basis, the alternative energy and the shift to alternative energy, including that -- but not just for the Rakuten Group, including our partners, we want to promote this as ecofriendly. Thanks. And last but not least, so the plan 2030. So we want to make further growth Towards 2030. And now we are developing the plan to that end. Sorry for a long presentation. This concludes my presentation. Thank you very much. Thank you very much for listening.
Thank you. So this is the end of the financial results briefing section. Thank you very much. Ladies and gentlemen, thank you very much for joining us on the second quarter 2022 Rakuten Group Financial Results briefing session. From here on, we would like to have a Q&A session with the press. I'd like to introduce the people on stage, Hiroshi Mikitani, Kenji Hirose, Masayuki Hosaka, Kentaro Hyakuno, Kazunori Takeda. So these are the 5 members from the management team. I'd like to now explain how this will proceed. So the question-and-answer session will be simultaneously translated. Please choose the language of your choice from the menu bar. And please do not choose the mute original audio. During translation, the main -- the speaker's volume will go down and the interpreters voice will be the main sound that you will hear.
And please download the relevant material from the website if you need to look at English material. And please raise your hand if you would like to ask a question if you're using PC and for smartphones, click on more and then raise the hand using that function and also make sure that you're unmuted before asking the question after your name is called. And also for the press, we -- you can actually input your question in the Q&A form as well, which is shown at the very bottom of the screen. And please ask questions regarding the financial results only. And also please limit your question to 2 and please ask them at one time. If you have any questions, please raise your hand.
Thank you. Mr. Hatani of NewsPicks, please.
Hatani from NewsPicks. I have one question to Mr. Mikitani. First of all, progress of mobile business. As you mentioned earlier, Voyagin plan has been discontinued maybe. But I think the number of subscribers compared to last year is down. So what is your evaluation of the current level of the number of subscribers? And one other question is Rakuten Bank and Securities, IPO, the thinking behind. They have been announced already. So parent subsidiary IPO or being listed in terms of governance, maybe the investors don't like that. But despite that, you're doing it. And I think the share price is about half of what it used to be last year. So maybe is it because of the cancellation of the conglomerate structure? Or what is the reason?
Okay. Mobile, as you know, the JPY 0 users, there used to be quite a lot of such users, but excluding that, about 30% is the growth rate. That is a real subscription base. So of course, we started our network from scratch. So we had to start by offering very generous plans, but we would like to make it more true to life. And so JPY users excluded, it's 30%-plus increase. So it's not like a total transformation of the customer base. But I think the users that we will have going forward will be really sound users, so to speak, for our business. So I think that was a good step. And as I mentioned earlier, there are some differences amongst different areas. There was -- there's more concentration in the urban areas. So area network, of course, it will be improved further. And also area-specific marketings will be promoted and strengthened so that 12 million people, subscriber is what we would like to realize as soon as possible.
And parent subsidiary listing, there are different aspects here. I think Rakuten Group is really diversified now and each of the companies in the group are profitable. And so, so-called Internet conglomerate, I don't think there is any such conglomerate, analysts, investors for these people as well, we're trying to make things easier and clearer to see. So that's one objective. And Rakuten Bank, especially by having more capital we can actually expand the scope of our business is what we're trying to realize. So the interest rate now is 0%. So we want to take necessary measures not to really have too high -- much high risk, but a little risk and a little return. Well, we're trying to make sure that there's going to be the synergy within Rakuten Group.
Of course, the data can be leveraged, not about individual brands, but -- or shares, the hotel finance, for example, Rakuten Travel data can be leveraged so that there can be an overwhelming differentiation realized. And Rakuten Mobile data can be used to understand the demographic trends. In other words, that data has the great advantage and also synergy with Rakuten Card. But of course, because we're talking about a bank, so we have to have this arm's length relationship. And especially for finance, fintech companies the rigid financial services agencies guidance is there. And therefore, it is an independent company. And therefore, with all these in consideration, we have decided to have this IPO and security, similar story. But I think we want to make things clearer and easier to understand. Thank you.
Okay. Then next is from [ Yomiuri Newspaper, Ichikawa-san ], please start your question.
[ Ichikawa from Yomiuri Newspaper ]. So I have 2 questions related to mobile business. And the first question is in your presentation, JPY 0 termination. And then you mentioned that the profitability improved. What about the range of profitability improvement? Maybe you cannot mention about the absolute amount. So is there any referential data that you can share with us? And then the inflow and outflow, for inflow, outflow what would be your estimation? So that is the first question. And the second question is about mobile business contribution to other businesses. And you talked about the cross-use and then the spending amount is highest among other users. So looking at the mobile business only, probably, you still have a negative number. But looking at the cross-use with other businesses, I believe there is some contribution. So if you have any image to share, please let us know.
So could you look at the Page 58 comparing to the year before, JPY 11 billion profit improvement was made. And from November and after -- so we had decent cash back and they paid back in September and October, so they don't have to pay gradually. But after November, they have to pay JPY 980 from month recharge. And then globally, the churn may happen with that, but we will be able to see a good profit improvement at that timing. And about the roaming cost, well, it's getting expensive. And today, so the 7% of the data usage is roaming. And then it has become the 6% or so the -- before that, 78% was a roaming ratio. But now we reduced it to this level. And as was our churn, so the roaming, there is a limitation of 5 gigabyte usage. So if it goes beyond and then the speed would be slowed down by 1 mega bps. This is a service for the roaming. And this portion -- by reducing the roaming area, we want to eliminate this portion. With that, we would like to reduce the churn rate.
And the reason of churn, there are 2 things. As mentioned in my presentation, first of all, roaming area, there is a limitation of 5 gigabyte data usage that is the one. And the second reason is about even regardless of the roaming, network coverage is not sufficient enough. And then by covering it 99%, we want to eliminate this portion. And also, I would like media to draw attention here. In September, AST Rocket Satellite will be launched with that from Sky or the space for the Rakuten Mobile, so the -- even the population coverage is about 99%. But when it comes to the mountainous area or the populated area, they cannot go into that area. But that is not the case to us. From the geographical point of view, we can cover 100% with this satellite launch. And this is another big differentiation factor. So these are the 2 problems that we can resolve and then we can reduce the portion of the churn. And then what will be the battlefield is who can use the unlimited data usage. Who can provide that? And in application basis, it went up to 10%, and that is a big reason. So we want to expand this to the nationwide and cover more. So what was your second question?
Sorry, the second question is about mobile business contribution to other businesses.
We are actually quantifying that, but it's not disclosed to the outside. It's growing largely. About -- so in the future, ARPU basis above JPY 1,000 or high. I think we can reach that level. So including this ARPU portion, and then how should we allocate from the profitability point of view, and it's not decided yet. But -- so profit contribution from the mobile business is very big and new users to the Rakuten Ecosystem, 20% of them are from the Rakuten Mobile. And once they join from the mobile, then they will become a loyal user to our ecosystem. So not just for the 12 million users maybe 15 million or 20 million users has been -- will be living in the Rakuten Ecosystem. In mobile, with the JPY 2,980, and then they have the point like the JPY 1,000 or so, so they can use the -- actually the free for the mobile services because they have a lot of points to cover that.
Thank you. Next [ Karanishi-san from Suhan Shinbun Newspaper ].
[ Karanishi from Suhan Shinbun Newspaper ]. I have 2 questions. First, about domestic EC, global EC companies are struggling, but you're doing very well. Now I think that is partly due to Rakuten Travel. But Shopping EC, for example, what is the situation surrounding shopping EC? Maybe the numbers might be difficult for you to disclose, but please answer that. And also, there is logistics efficiency improvements. And I think Mr. Mikitani showed his willingness to do same day delivery, for example, if you have any prospects for that, please share that with us, too.
Takeda-san?
This is Takeda speaking. I'm in charge of e-commerce. So about your first question about e-commerce. Yes, it is true that into -- well, travel, it's back to 2019 level. And during the COVID period, what used to be off-line shifted to online. In other words, people are making online reservations and the number there, since we have less constraints, it is increasing and also because of the campaigns by the government, [indiscernible] that is in Japanese side, also had a positive effect. So in the second quarter, this proved to be really positive. And not only that, when people go out of their houses or travel, e-commerce, you might think that it might become sluggish as a result. But now actually during the COVID period, we actually developed this customer base, which is quite strong.
And in addition, people experienced the fact that it is very convenient. They're used to that convenience and that is becoming the norm for many of them. As a result, in terms of the number of purchases made as well as the unit purchase that they make, they have increased in both. And so Rakuten Travel as well as Ichiba, Rakuten e-commerce merchandise are being purchased online. And also leisure-wise golf or beauty-related businesses. Again, people are going out than before. For example, playing golf that is becoming more popular. And in beauty, again, people go out and then they have to take care of their hair styles. So all of these come into play. And overall, e-commerce has grown quite steadily as a result. So that's what you see in the results of Q2. As for logistics, there are different steps that we have taken so far.
Japan Post, we have a joint venture with them. And as a result, the number of shipment points, so to speak, have been increased because Japan Post, post offices are the different locations around Japan and we can cover the entire land of Japan. At the same time, warehouse, not just in Kanto area but Osaka area or Kansai area as well as in Kyushu, we have different warehouses being built in different regions. So that inventory can be stored closer -- physically closer to the destinations, the users. So delivery efficiency and speed increase was realized. And then this direct shipment between the warehouse and the shipment outpost. And also last 1 mile is the final step. So we have taken all these steps gradually, so that at the end of the day, there will be safe and secure distribution or delivery to the customers. I'm now going to talk about the specific period, that in 2- to 3-year period, we will clear all these steps so the e-commerce share will be 10% or higher. In other words, towards that, we would like to make sure that the logistics will contribute to realizing that goal.
Okay. Let me add to that. One element there is the free shipment threshold was introduced, and I think that had a major impact. And with that, of course, there were many various measures taken, and so 99% or so has been covered by that threshold. And in terms of genre, Netsuper included food is doing very well. Fashion. In the past, it used to struggle a little bit, but Rakuten Fashion now has become a high brand site. The Rakuten Fashion Week Tokyo is realized as well or carried out, and that is adding on to that. And so 8.6% is the number you see here. What used to be the supply chain issue leading to some struggles in the Home Appliances segment, but because of the really hot summer, there are goods for -- to prevent heat or protect ourselves against heat that has added on to that. And cosmetics, super high brand cosmetics are already included, and people are traveling while going out. So all of these are positive. And Packaged Media, Rakuten Book Network is the wholesale company, and that is doing well, okay -- well as well. And so all of them are doing quite fine. And therefore, overall, we are doing very well, I would say.
Okay. It is almost time to close the first part. So let us take 2 more questions. [ Freelance, Ichikawa-san ], please start your question.
This is [ Ishikawa, Freelance ]. So from April, about 220,000 to 230,000 you reduced, but is this higher than your expectation or lower than your expectation? That is the first question. And about the 230,000 the churn users, do you have any message to them?
So -- well, so JPY 0 users, actually, they left. And among them, actually, no usage at all. They didn't use our service at all some of them or so. And then -- so we want to convert the users to paid users. So we accepted a certain amount of churn -- and also who left the Rakuten Mobile, but we are evolving and the 5G is coming. So we are using the cutting-edge technology, and you can acquire points among the Rakuten Ecosystem and we increased it. So looking at this in a comprehensive picture and when the timing comes, I would like those people to consider coming back to Rakuten Mobile, that's my feeling today.
Thank you very much. Final question from [ Nihonke, Worship Newspaper ]. [indiscernible].
[indiscernible] I have 2 questions. One question is so churn after stopping this JPY 0 plan, as you explained earlier, for segments, other than JPY 0, maybe just partially, but there were like 20% or so defecting or churn from those segments as well. So what do you think about those people who were paying but still leaving Rakuten, what do you think? And you mentioned you're targeting 12 million subscribers. Are you -- and by when do you think you want to reach that level? Can you elaborate a little more about your targets, please?
Okay. Those people who are leaving us or have left us the reasons I already touched on. So maybe there are people who used to be -- who are in the roaming areas, 5 gigabyte is the upper limit. And once they go beyond that, network speed will go down. And so maybe that's one reason for the churn. And therefore, Rakuten's own network has to be built out that should be sped up, accelerated. And these people leaving us. Of course, there are different carriers that they might have gone to DOCOMO, Rakuten, KDDI. Of course, there are people who are switching from one carrier to another. But the paying customers, I think there has not been or there is no change from how things were before. And further decline in those segments, actually, 97% is the population coverage now, but 99% coverage is what we're trying to realize in order to keep them with our -- in our subscriber base.
And as for our subscribers, of course, they are expected to grow with the expansion of the population coverage, the build-out of the network. And also for marketing, we are having area or region-specific marketing strategies. So at the right timing, we will announce such targets for new customer acquisitions. It's nearing 30 million Rakuten cardholders. And compared to that as well, I think the speed is much faster with Rakuten Mobile customer acquisition. Therefore, at a nearly possible timing, 12 million or even 50 million is what we're planning on or would like to reach. But we haven't really announced the exact schedule for that. So please forgive me, I cannot share that with you.
So this concludes our Q&A session for the media.
Thank you for joining our live question-and-answer session on Rakuten Group's 2022 second quarter financial results. Now we would like to entertain questions from investors and the analysts. Please allow me to introduce people on the stage. Hiroshi Mikitani, Kenji Hirose, Masayuki Hosaka, Kentaro Hyakuno, Kazunori Takeda. These 5 people. So let me talk about how we proceed this Q&A session. And this Q&A session will be simultaneously translated into English and Japanese. Please select the language you would like to hear in your audio head from the [indiscernible] at the bottom of your screen. Please do not select mute original audio. When the interpreter speaks, the original volume will be lowered, and you will hear the interpreted voice over the speaker. The presentation materials shown have been aligned with Japanese, if necessary, please downward the presentation materials from the Investors page on the corporate site. And for those joining from their PC [indiscernible] participants to get any view, you will find the [indiscernible]. And please quickly hand to ask a question. If you are joining from your mobile phone, please tap more and then tap raise hand in order to ask a question. If your name is called, please make sure your microphone has been unmuted before asking your question.
[Operator Instructions] So if you have any questions, please raise your hand. Okay. From Citigroup. Tsuruo-san, please unmute yourself and ask your question.
Citi Securities. The first one is on mobile future profitability improvement outlook. So looking at your chart today in Q4, so the loss would become the around JPY 100 billion in your chart. So the JPY 20 billion improvement -- JPY 25 billion improvement. So what will be the contribution factor to make this happen? And what is your idea specifically, the ARPU and roaming cost how will it be changing toward that? And that is the first question. Second question is about the free cash flow situation. So in Q2, so you had a very big negative free cash flow in nonfinancial areas, about the JPY 490 billion, how do you see the future that will be your option to resolve this funding option? These are the 2 questions.
So as for the specific number, we do not disclose the specific number to outside. Therefore -- so which is about JPY 100 billion or so. I cannot mention anything because we don't disclose information. And shown on the chart, ARPU improvement. So because of having no JPY 0 user, that would happen in November and after and then that will be improving after that. However, even today, data usage volume has been increasing. So we see some natural improvement and the acquisition of subscribers, as I spoke to the media previously, so JPY 0 user -- excluding JPY 0 user that would be 30% plus profitability -- had a 30%-plus increase comparing to the year before. And that is another contribution impacted profitability and since we launched this LIMIT VII and we have some heavy users from the beginning. And the roaming cost in Q2. So the roaming percentage is about 6% to 7%. We are using the KDDI roaming for that. But today, it is 6% to 7%, but the action -- we have been gradually reducing the roaming usage and that -- everything is not reflected into the Q2. I think that is another big factor.
And free cash flow could -- you may ask the Hiroshi-san to talk about that.
So Hiroshi is speaking. As for the free cash flow outlook, so the Rakuten Mobile in '23, and the profit in a single month is what we are aiming at and that is communicated. And of course, the depreciation cost must be built. So EBITDA, the profit would happen before that. And other business -- including other businesses and overall cash flow will become positive. The timing is not so far from future. And then so the mobile CapEx, which is needed before the end of the year, we've already funded. So from the financial point of view, there is no big the burden. On the other hand, as you know, so we have been working on the IPO bank. So the financial or the position improvement will be done through that. That's all for me. Thank you very much.
Thank you. Next, Bank of America Securities, Nagao-san, please.
I have 2 questions as well. First question, the domestic e-commerce GMV -- GMS. I think it was quite steady, but can you elaborate on that? You did talk about that to a certain extent, but can you be more specific? For example, is it the frequency that is increasing? Or is it the unit price or ARPU? Is it a point program that is leading to enhanced frequency? I think other competitors are actually strengthening their point programs as well. So were there any impact in that area or not? That sort of details will be appreciated. My second question is the following. It's also about mobile. In the past, I think in the latter half of 2023, on an operating income basis, I think you were trying to be in the black on a monthly basis, but you changed the strategy this time. And therefore, this stand-alone profitability schedule or timeline, has there been any change in your prospects or not? That's my second question.
Okay. So Takeda-san should answer the first question, please.
Okay. Yes, Takeda, in charge of commerce -- e-commerce. So you're asking for more details. So regarding accounts, of course, cross usage and also mobile among others, we see increasing trends there. And for cross usage, and I talked about this or we talked about this already, but Ichiba at the very center, there are cross-use with other services within the ecosystem, and we're running through various campaigns to promote such cross-use. And as a result, many new subscribers, but not just them, but the wallet share in each of the users have been improved or increased as well.
And for frequency, well, during the COVID pandemic, the users became more loyal to us. They are what we call diamond users. Such diamond users are on the increase. In other words, the frequency of purchase is, for sure, increasing for these people. And especially on a regular basis, we have super sale and marathon campaigns and other campaigns and there's higher recognition for such campaigns. And these people are registered every time and such registered users are increasing as well. So overall, the total number of users is increasing, the frequency is increasing. And we talked about the different genre or segments where the increase has been witnessed as well. Mikitani-san talked about that. For each of the areas or segments, the purchase amounts per transaction is increasing. So each might be small increase. However, it has added up to a major increase that we have announced. Thank you.
If I may add, on Page 21 of the appendix, I talked about mobile. 81.2% is the number that is shown there. So these users are actually purchasing on a regular basis, new customers, maybe the unit purchase price might not be increasing that much. However, still, overall, it is increasing. And there are more and more people who purchase everything online in Rakuten. And so cross-use is really impactful in this regard. So Rakuten point contribution is really big, I think. And for mobile, the stand-alone profitability, of course, we have our strategies for turning into the black. Of course, there are things that we can disclose and things that we cannot disclose yet. So sometime in the future, of course, we will disclose what we can disclose. And so these are some of the things that we have been doing. And ARPU, the data usage being increased is what we are trying to realize so that ARPU overall will be increased.
And also for enterprise customers, there's a lot of interest and there are a lot of inquiries. In other carriers, I think maybe the contribution level by enterprise customers is not so high. However, when the cost is low for us -- our carrier, I think that this is a really strong, attractive point for potential enterprise customers, and there's a lot of interest. And of course, they have ongoing contracts, so they cannot switch over overnight. However, when we meet with them, about 1/4 of the potential customers actually decide that they will switch to Rakuten. And we have more than 400,000 customers of Rakuten, so we are running our marketing or sales activities focusing on those customers and the other companies were not able to do that. A very condensed kind of enterprise contract or it was not really practiced by other carriers. But I think enterprise or corporate market is going to be quite large. So finally, we have come to this stage where we can carry out such sales activities with the enterprise customers. Thank you.
Thank you. Okay. The next is from HSBC, Neale, please.
Two questions, please, both on mobile. The first one relates to data traffic costs. So I understand that the roaming costs payable to KDDI are declining. But previously, you've mentioned that the increase in traffic has increased costs. So now it sounds as though you're aiming for higher value users. Your data usage is already higher than payors. So can you give us any guidance on how you expect that to evolve? And the second one relates to that, it's about 5G. Now I assume that you would like to move as many users as possible to 5G as quickly as possible. It's more efficient. Are you able to give any detail on what your current 5G coverage is and where you expect it to be by the end of the year?
Hear me?
Yes, yes. Go ahead.
Okay. So the KDDI roaming forecast is a little bit difficult because of the -- not only our decision, the record discussion with KDDI, but our aggressive target is, of course, we can reduce as much as possible. But right now, as Mickey mentioned about current total traffic is almost 7%. But like still some of the area -- total traffic is 6%, but like total area is still remaining in the rural area and also a part of like the inside building in urban area as well. But our penetration building construction, the anti-penetration is going forward to the rural area right now. So a little bit difficult to say right now, but like our passion is that we want to reduce as much as possible in near future. Is this okay?
Yes. I think it's dramatically going down. We do not disclose the number. Obviously, data usage is growing, but it's the -- now it is going down significantly. But at the same time, the -- we cannot talk too much about the details of roaming agreement. But we have some kind of fixed cost coverage. We have to pay to KDDI. And -- but anyhow, it's going down dramatically. With regard to 5G -- what can I say I think this is a direct agreement with KDDI so please, understand we cannot tell you how much we're paying to KDDI I think but that's a significant amount. And then it's coming down dramatically. With regard to 5G, we have built a [indiscernible] 12,000 5G base stations. But please be careful when you talk about 5G, there's 2 type of 5G. One is what we call the big 5G, it is low band, like [indiscernible] band, they converted to 5G. And we do not really gain any benefit based on that. When you are talking about that is [indiscernible] 5G and [indiscernible] and we think this is very, very important to upload the traffic because we have much bigger bandwidths. And one of that obstacle -- this is not only for Rakuten Mobile, but this is also true for other carriers, big carriers, that there is an interference issue with the satellite base station of the satellite broadcasting companies. And that we have to be power down our 5G base stations, especially in Tokyo. But that kind of restriction is done in most of the western part of Japan. And then that will be gone in [indiscernible]. So after that, I think we're going to have more 5G coverage. And then I think we are carefully planning smartly where we want to build 5G. And traffic wise this is same for all the carriers think that it's not as severe as yet. [ The area ] where we have the [indiscernible] and so forth, more than 50% of traffic is going to 5G. Tareq, do you have any comment about this 5G issue?
I mean, I would add, just I want to elaborate about efficiency. For us, whether it is 4G or 5G, it really is not a large obstacle to move customers from one technology to the other. I think we've talked about this before, the nature of this virtualization of the infrastructure gives really unparalleled efficiency and our ability to fast track the deployment of 5G is also really not a very significant effort. So we've deliberately selected to deploy massive MIMO as a standard technology for 5G, and that's having significant benefit. But as Mickey said, keep in mind, that in Tokyo itself, we still need to operate at max output power to realize full efficiency of this 100-megahertz spectrum that we have in SUB6. So I think our plan is progressing well, but we need to really remove this restriction from the earth satellite interference to deliver on max capability for true 5G performance in Tokyo area specifically.
But that's in least amount of time.
Okay. In the interest of time, next will be the final question. Kazahaya-san, please.
Kazahaya from Crédit Suisse. Mr. Mikitani. In the interest of time, I will just ask 1 question about mobile. In the 5G effects of Rakuten Mobile to the ecosystem is of interest to me. In the media part of the Q&A, you said ARPU, JPY 1,000, approximately, is the number you gave. Now let's say, ARPU JPY 1,000 is the synergistic effect that would be on an annual basis, JPY 12,000 per person, and you have 5 million. And then with the number, it might be JPY 120 billion, if you have that many customers. So JPY 1,000, it is based on gross profit or -- what is the prospect or the expectation that you can draw from this? I'd like to hear more about that.
Okay. There are 2 parts to that. One is offensive contribution on the surface. That is Rakuten Ichiba, maybe JPY 1,000 -- or rather JPY 6,000 more purchase by 1 person. And then the ratio would be multiplying that by 10%. So that would be JPY 600. So that's one way of thinking. But is it JPY 600 total that translates into profit? No, it's not going to be 100% profit. So what's the ratio that you apply is the question. So gross profit is not what we're basing it on. But rather operating income contribution, how much contribution is it is what we are going to need to capture. On the surface, about 50% increase means JPY 12,000 going up by JPY 6,000 to JPY 18,000. So travel, card, all of these included, of course, JPY 600. So I think if you just add them all together, it will be over JPY 1,000 on a gross profit level. But of course, you have to think about the marginal profit before tax, how much increase we will have is what we're really focusing on. And in addition, what is the target that we should focus on is one thing. But setting that aside from now -- for now, of course, there are different ways that you can get a profit. Of course, there are competitive situations that was not so clear in the past. Amazon Live Video or doing shopping using Amazon and others, there are different things that emerged that we were not aware of in the past. So with agreements, of course how we can make contribution to the distribution or the GMS and also opportunities for advertisements is another area. So Rakuten Mobile users, the loyalty level is very, very high, unbelievably high. And therefore, if it's an increase of 15%, then Rakuten Ichiba may be increased by JPY 20 billion to JPY 30 billion is what you might get as a result.
Okay. So mobile alone on a stand-alone basis, tends to draw attention. But you think -- you have to think about the profits that you can make in the entire ecosystem. And that is a unique strength of Rakuten Group. So I hope you will give us more detailed explanation in the next rating session or beyond.
Yes. From next time on, we will try to include that information. Low price is one, of course, one piece, but was it in September or October . Mobile will have SBA -- SPU. So super point up. Mobile used to be outside of that campaign, but it will be included. And so once it is subject to SPU, the card, the bank, the security, they benefited from SPU, Super Point Up and mobile will join that group. So I think there will be inflow as a result of that mobile joining SPU.
So now we would like to finish the Q&A session for the investors and the analysts. Thank you very much. And we would like to have Mikitani-san to make a closing comment.
So to be honest, the Rakuten stock price is valued very low. So there are 2 factors that is undervalued. First one is the Rakuten Mobile to do -- so investors' concern to Rakuten Mobile. That is one reason. Therefore -- so this is a profitable business and a great business, and they want them to get the confidence. So we would like to enrich the disclosure of the information related to this business. On the other hand, the technology itself, well, it's really great. And then the world mega carriers are interested in our technology. Amazon, AWS, e-commerce, they have doubled wheel. And just like that Rakuten Mobile is Rakuten subscription and simple. These are the 2 wheels to 1, and that's what we would like to do in this mobile. And one deal may be several hundred billion yens level.
And what I want you to understand is why Rakuten Mobile is successful with virtualized technology and please come over to our laboratory. And then you will understand what is different from others. And basically, the Rakuten Mobile. So this is a test drive to improve this basic technology and other companies went failure. Why? Why all of them went failure because they do not have the people and also they do not have any test drive only Rakuten Mobile develop technology by itself and then run it and then sell that complete technology to other company because we have established this business model and then including the U.S., the world, the large operators are paying attention on our technology.
And sometimes the operators criticize or technology because it may disrupt their business, but the 1 in the achieved latency milli sec and the speed, and this is just like a Guinness record result they made. So looking at the fact, what they have achieved, this will make a great difference. And as for the business contract and if we carry our technology, even if we cannot reach 25% at right now, but it is possible for us to reach around 10% in the near future. And today, what we haven't covered is the advertisement business, which is 26%. It's still growing plus 26% Y-o-Y. I should have mentioned this. So the entire ecosystem, the source is arbitrage. So where do we generate the source is a question.
So one of that is -- so you can define what you want to find and easy to purchase. That is one thing. But the biggest thing is utilizing the data and then the developed properly the advertisement, and we have like JPY 160 million to JPY 170 million of advertisement revenue too, we want to grow it up to JPY 300 million to JPY 400 million if possible. So the -- in order to so the O2O strategy must be developed with the including of Netsuper and mobile. So how can we make this business into the profit?
I think it's important to you, however, if we can reach that 12 million subscriber or 20 million subscribers, how much the profit can -- or revenue can we generate it? Maybe you can do the math using the spreadsheet. At this point in time what we can say is in the past 2.5 years, we have less than 6 million subscribers. This is a quite remarkable result. And then we have some external environmental factors, but please believe in our ecosystem power, then it's not over time that we go surplus the 12 million. And what is very important, we have to establish the end-to-end base station. That is really important. The coverage is important.
And then so if we have a good cost structure, it will win. So why Rakuten Card win? I think the same factor applies to Rakuten Mobile, why the Rakuten Bank now have the 13 million accounts and the JPY 7 million profit -- JPY 70 million profit. So the -- and sorry, Rakuten Mobile will be generating more profit than these -- the existing businesses. And as I mentioned before, the contribution to the entire Rakuten Ecosystem is profound. So in this context, Rakuten Bank, we are going to list the Rakuten Bank and -- so the Rakuten conglomerate, we went to surface how much we are discounted. And so that we can promote the understanding of our businesses among the investors and having a heavy capital. So we can have the profit contribution above the dilution is possible, 30% valuation. And then if we can double the profit, and then we can have a big contribution to the parent company. And also specific capital gain from there will become big. That's how we see. So net-net, I would like you to look at our business in a comprehensive manner. Thank you very much.
This concludes the Rakuten Group company's 2022 Q2 financial results briefing session. Thank you very much for your attendance. [Statements in English on this transcript were spoken by an interpreter present on the live call.]