Livero Inc. Q4 FY2025 earnings call

• 2025 Full Year Performance
  • The company achieved 16 consecutive periods of revenue growth, driven by its mutually reciprocal customer referral virtuous cycle structure. Results came in almost exactly in line with the full-year plan.
  • Unlike prior periods, where second-half profitability typically declined due to peak season preparation costs, the 2025 second half delivered strong revenue growth and stable profitability. The company has implemented processes to reduce human resource training costs ahead of peak seasons, which is the key driver of this improved performance, and management expects this dynamic to continue in future periods.
  • Leading indicator KPIs are growing steadily, and the company successfully reduced selling, general and administrative costs (SG&A) while continuing to grow revenue, enabled by improved organizational structure. Operating income was broadly in line with plan, though slower growth in the first half created a lingering drag on full-year results.
  • The balance sheet naturally has larger fixed assets and liabilities due to the company's sublease business.
• Business Model and Competitive Advantages
  • The company's services start from capturing demand at the 'most upstream' stage of new life events: apartment hunting. It captures this upstream user information through multi-faceted services for both corporate and individual customers.
  • The business model combines both flow revenue and recurring (stock) revenue: user relocation information is collected via its services 社宅ラクっとNAVI (Shakutaku Rakutto NAVI) and 新生活ラクっとNAVI (Shinseikatsu Rakutto NAVI), this information is referred to partner new life-related service providers to earn referral fees (flow revenue), and recurring stock revenue is earned from providing corporate company housing management services.
  • Core strength is a virtuous cycle of mutually reciprocal referrals: the company refers users to real estate companies, and growth in referral volume leads to more user information being shared by real estate companies back to the company's platforms. This structure builds a stable operating base, drives accelerating revenue growth, and generates capital to invest in new service development to collect more apartment hunting information.
  • Corporate-facing services are growing steadily: the number of client corporations has exceeded 4,000. The launch of benefit company housing targeting the general market expanded the company's addressable market size by approximately 17 times.
  • The company maintains the industry's largest nationwide network of new life-related business partners, enabling one-stop support for people starting new lives. This has created a unique market positioning different from single-segment focused companies and generates strong competitive advantage.
• Multi-Year Growth Track Record
  • Following the company's IPO, it used proceeds to make investments in 2022, which caused a large temporary decline in operating profit. Over the 5-year period from this investment to the 2025 fiscal year, the company has delivered a compound annual growth rate (CAGR) of 20.3% for revenue and 93.9% for operating profit, showing steady growth.

The provided transcript does not break out separate financial performance data for individual product segments. Aggregate consolidated results for the full 2025 December fiscal year are as follows: Revenue grew 21.7% year-over-year, with revenue and operating income hitting 93% to 95% of the full-year plan. Net income hit the full-year plan target of 0.53 billion yen. Operating income grew 56% year-over-year, and net income grew 67% year-over-year. No segment-specific absolute financial results or revenue contribution percentages are disclosed in the available transcript.

• For the full 2026 December fiscal year, management is guiding: 5.35 billion yen in revenue (+22.6% year-over-year), 1.1 billion yen in operating profit (+44.7% year-over-year), 1.105 billion yen in ordinary profit, and 0.75 billion yen in net income.
  • Of the 5.35 billion yen 2026 planned revenue, 5.0 billion yen is already secured from already-signed customer contracts, meaning this portion of revenue is highly likely to be achieved if the company delivers on existing support obligations as planned. Departments have explicit plans to acquire additional new contracts to cover the remaining required revenue.
  • The company maintains a long-term target of reaching 2.0 billion yen in operating profit by 2028. Management confirms that progress toward this target is on track, and the company intends to hit this target as planned. Management views the 2028 target as a waypoint, and aims to reach it as early as possible to move to the next growth stage.

No explicit discussion of risks, material operational issues, or operational failures is included in the available transcript.

Q: What is the most important factor for Libero's future growth, and what key indicator should investors monitor?

A: The most important key indicator is the number of sublease units. Growth in the number of sublease units not only drives expansion of corporate services, it also increases the volume of apartment hunting referrals sent to real estate companies, which in turn increases the volume of referrals that real estate companies send to Libero's platforms. The number of sublease units is the starting point for expanding this mutually reciprocal referral cycle. Additionally, a larger sublease portfolio also gives Libero more leverage to negotiate transaction prices with real estate companies, allowing the company to grow profits from downstream related services in a multiplier effect.

Q: What is the company's policy for dividends and shareholder returns?

A: The company will maintain its existing policy going forward. Any changes to this policy will be publicly disclosed when they occur.

Q: Is progress on track toward the 2028 target of 2.0 billion yen in operating profit?

A: Progress is on track. We view the 2028 target as a passing waypoint, and we intend to reach this milestone as early as possible to advance to our next growth stage.