CyberAgent Turns Profit in October-December 2024, ABEMA Performs Well

2025-01-29

CyberAgent Inc. recently released its consolidated financial results for the October-December 2024 period, revealing a return to profitability with a net profit of 5 billion usd, compared to a net loss of 472 million usd in the same period last year. The media business, which includes the internet television service ABEMA, and the AI-powered internet advertising business saw strong performances. Additionally, profits from the sale of fixed assets contributed positively to the results.

Revenue increased by 6%, reaching 203.8 billion usd, and operating profit surged by 32% to 8.3 billion usd. The media business, including ABEMA, recorded an operating profit of 1.4 billion usd, a turnaround from a loss of 796 million usd in the same period last year. CyberAgent’s CEO, Shin Fujita, mentioned in an online briefing that while ABEMA is not yet profitable on its own, it has been steadily reducing its losses. Popular content, including anime and combat sports, has driven growth in subscriptions. ABEMA’s weekly viewer count exceeded 30 million at one point and recently stood at 20.79 million.

The company rebranded its media division from “Media Business” to “Media & IP Business” to better reflect its strategy of focusing on intellectual properties (IP). The AI-driven internet advertising business saw a 6% increase in operating profit to 6 billion usd, while the gaming business experienced a 4% decline in operating profit to 3.3 billion usd, mainly due to falling sales from existing titles. Despite a 1.2 billion usd impairment loss, the gaming division benefitted from fixed asset gains in its subsidiary, Cygames, a mobile game developer.

CyberAgent maintained its full-year financial forecast for the period ending in September 2025, projecting a 2% increase in revenue to 820 billion usd and a 29% rise in net profit to 21 billion usd. CEO Fujita explained that the company’s medium- to long-term strategy involves investing in the media business, which has accumulated a large user base, and creating global IPs that can be leveraged for international sales.

Additionally, CyberAgent announced plans to spin off its Ameba-branded services, including Ameba Blog, into a subsidiary, effective April 1. The sales of the businesses to be split off are expected to be 11.7 billion usd for the fiscal year ending in September 2024. This restructuring is aimed at improving management efficiency.

What Undercode Says:

CyberAgent’s latest financial report signals a promising shift toward profitability, fueled by its diverse business portfolio. A primary factor behind the company’s turnaround is the strong performance of ABEMA, which has become a key player in the Japanese streaming market. ABEMA’s ability to grow its user base, driven by popular content such as anime and live combat sports, positions it well for long-term growth. While the service is not yet profitable on its own, the steady reduction in losses is an encouraging sign for its future.

The rebranding of the media business to “Media & IP” reflects CyberAgent’s strategic pivot toward creating valuable intellectual properties (IPs). This move is crucial as IPs can serve as valuable assets for licensing and distribution beyond Japan, opening new revenue streams from global markets. Given the rising importance of content in the digital age, CyberAgent’s investment in ABEMA and its effort to build a portfolio of globally appealing IPs will likely pay off in the long run, especially as the company looks to scale its operations and increase its international footprint.

However, the company faces challenges in its gaming division, where sales of existing titles have been declining. The 4% dip in operating profit and the 1.2 billion usd impairment loss highlight the pressures faced by gaming companies in an increasingly competitive and saturated market. Although Cygames remains a strong subsidiary, the gaming industry’s volatility could pose risks to CyberAgent’s overall growth strategy.

The AI-powered internet advertising business is another bright spot for CyberAgent, with operating profits up by 6%. This segment is a strategic focus, as AI technologies continue to revolutionize the advertising landscape. With the ability to optimize ad targeting and improve efficiency, this division has the potential to drive significant future growth, especially as advertisers seek more data-driven solutions.

CyberAgent’s decision to restructure and spin off its Ameba-branded businesses aligns with its focus on improving management efficiency. The move will likely allow the company to streamline operations and allocate resources more effectively across its core business areas. The projected 11.7 billion usd in sales from the spun-off businesses suggests that the company’s restructuring efforts are well-calculated and should contribute to future profitability.