Hello, everyone. Thank you very much for taking the time out of your busy schedules to join us today. I will be explaining the results of Rakuten Group for Q2 of 2025. Here is today's agenda. First, I will explain the business performance. After that, our CFO, Hirose, will explain the financial results and our Chief AI and Data Officer, Ting, will provide an update regarding AI. To begin, I will report on the status of Rakuten Mobile, which is of great interest to everyone. In Q2 2025, Rakuten Mobile's stand-alone EBITDA improved by JPY19.1 billion YoY, reaching JPY5.6 billion. Compared to the previous quarter, when we achieved our first quarterly profit, we were able to further expand the profit. We are making steady progress toward achieving full year EBITDA profitability in 2025. As for the number of subscribers, we surpassed nine million subscribers on July 7. As of July 31, we reached 9.08 million subscribers. Toward breaking the major milestone of 10 million, we aim to further accelerate the pace of net additions in H2. Next, I will report on the Group's consolidated business performance. In Q2 2025, consolidated revenue increased by 11% YoY to JPY596.4 billion. As a result of strong performance in our main businesses such as Rakuten Ichiba, Travel, Card, Bank, Mobile and Symphony, the Internet Services segment grew by 6.8%, the FinTech segment by 14.8% and the Mobile segment by 18.1%, achieving revenue growth across all segments. Consolidated non-GAAP operating income improved by JPY31.9 billion YoY, reaching JPY20.1 billion. This marks the first time since FY2019 that we have made a profit in Q2. In addition to increased revenue, the promotion of disciplined business operations and the advancement of various operational efficiencies through the use of data and AI contributed to this result. Consolidated EBITDA increased significantly by 54.5% YoY, rising by JPY36.4 billion to reach JPY103.2 billion. This is also the highest amount ever recorded for a Q2, and we believe that we have achieved very strong growth. Regarding AI, we are excited to announce a significant milestone in our AI-nization initiative, the official launch of Rakuten AI on July 30. Until now, Rakuten AI was available in a limited open beta, but our new Agentic AI service is now fully live available to all users across Japan and truly serves as the new gateway to the Rakuten ecosystem. Beyond typical AI agent interactions, Rakuten AI implements powerful concierge functions that perform everything from research to actions. This fall, we're bringing Rakuten AI directly to Rakuten Ichiba. By analyzing a rich variety of data from user attributes and preferences to purchasing trends from your e-commerce usage, Rakuten AI will provide product suggestions optimized for each individual user, further enhancing your shopping experience. Next, I will explain the business performance by segment. First, Q2 performance highlights of the Internet Services segment. Revenue increased by 6.8% YoY to JPY324.5 billion, and non-GAAP operating income declined by 10.5% YoY. However, this was due to the recording of valuation losses on some securities held in the minority investment business. Excluding these valuation losses, operating income increased 8% YoY to JPY19.1 billion, achieving solid growth. In the domestic EC business, in addition to the continued growth of core businesses such as Rakuten Ichiba and Rakuten Travel, the price revision implemented in the logistics business in June also contributed to increased profits. In International business unit, each business grew steadily with increases in both communication and advertising revenue for Rakuten Viber, contributing to the expansion of segment profit. Regarding the main KPIs, domestic EC GMS for this quarter was JPY1.5 trillion, a 4.7% increase YoY. Of this, GTV of the travel business, driven by the global travel GTV, including inbound travel, increased by 7.4% YoY. In addition, revenue of international business unit was USD481 million, a 1.9% increase compared to the same period last year. and revenue of the advertising business was JPY56.7 billion, a 4.7% increase YoY. Next, I will explain the performance of our domestic EC business. GMS reached JPY1.5 trillion, a 4.7% increase YoY. This was driven by strong performance not only in Shopping EC, such as Rakuten Ichiba and Rakuten Rebates, but also in Rakuten Travel, particularly in global travel GTV. Currently, we are maintaining a mid-single-digit growth rate, but we aim to accelerate growth going forward by implementing various measures such as expanding ecosystem synergies. Revenue increased by 5.9% YoY to JPY241.6 billion, and non-GAAP operating income rose by 7.5% to JPY23.1 billion. In addition to the growth of core businesses such as Rakuten Ichiba and Rakuten Travel, increase in fees for the logistics business also contributed. Across the entire domestic EC, we have achieved a revenue growth rate that exceeded the GMS growth rate and an operating income growth rate that exceeded the revenue growth rate, indicating that the profitability of the business is improving. Regarding Rakuten Ichiba, both the number of purchasers and the average spend per customer have increased YoY, resulting in an expansion of GMS. Strengthening collaboration with Rakuten Mobile will be key to accelerating future growth. Average GMS of Rakuten Mobile subscribers is 47.6% higher than that of non-subscribers. Currently, the proportion of Rakuten Mobile subscribers among all monthly active users of Ichiba is 15.7%. We aim to increase this ratio through initiatives such as promoting awareness of SBU benefits and holding exclusive presales for mobile subscribers. In addition, the number of products eligible for the Rakuten Saikyo next-day delivery service, which was launched in July last year, is steadily increasing. Lastly, the number of overseas affiliated merchants, which are operated by overseas companies or agents, has recently surpassed 1,000. The GMS of overseas affiliated merchants is growing at a double-digit rate, and this is also contributing to the expansion of Rakuten Ichiba's overall GMS. Next, regarding travel. While the overall domestic market is on a declining trend, Rakuten has maintained a flat growth rate. On the other hand, the global travel GTV, including inbound travel, has expanded significantly. In particular, we are currently expanding our market share of inbound travel to Japan, growing at a faster rate than the overall market. We expect global travel GTV to continue to drive growth in the future. Therefore, we will work to improve the UI and UX of Rakuten Travel's global site. And in our B2B business through Rakuten Travel Exchange, we will focus on increasing the number of partner properties. As a global OTA, we aim for further business expansion. In the logistics business, we implemented a price revision for Rakuten Super Logistics, or RSL for short, starting in June 2025. In light of recent increases in material and fuel costs, we had already revised prices once last year, but we continue to offer competitive pricing compared to other companies. Yet both the number of merchants using the service and the RSL shipping ratio in Rakuten Ichiba's total handled parcel volume are increasing. By utilizing RSL, merchants are able to focus on their core operations, which in turn leads to growth in their revenue and contributes to the expansion of Rakuten Ichiba. We will continue to work on increasing the number of merchants using our service. Additionally, although there was an administrative penalty related to delivery operations at one of our partner companies, there has been no impact on merchants using RSL, and we are continuing to provide stable service. So please rest assured. Finally, regarding the International Business Unit, revenue increased by 1.9% YoY to [USD]481 million, and non-GAAP operating income saw a significant increase of 52.1% YoY to USD10.2 million. Within this, Rakuten Rewards has been affected by the trend of US companies reducing their marketing expenses. However, both revenue and profit have remained flat while implementing cost controls. Rakuten Viber is showing strong growth in both communication and advertising revenue as the market expands. In addition, Rakuten Viki has achieved increases in both revenue and profit, driven by the expansion of subscriptions and the enhancement of its content lineup. Next, I will explain the FinTech segment. Segment revenue increased by 14.8% YoY to JPY232.7 billion, and non-GAAP operating income rose by 12.2% to JPY43.4 billion. The customer base for each service continues to expand, and in particular, the increase in shopping GTV for Rakuten Card and the growth in interest income at Rakuten Bank drove revenue growth this quarter. In addition, operational efficiency improvements are progressing across businesses, resulting in increased profits, especially at Rakuten Bank and Rakuten Payment. Regarding the main KPIs, Rakuten Card shopping GTV increased by 10.2% YoY to JPY6.5 trillion. At Rakuten Bank, the number of accounts surpassed 17 million and deposit balances also grew steadily by 7.1%. At Rakuten Securities, the total number of accounts increased by 10.9% YoY to 12.56 million and the number of NISA accounts, which boasts the industry's top market share rose by 18.2% to 6.53 million. Deposited assets are also approaching JPY40 trillion, which demonstrates that the customer base for our fintech services is continuing to expand. Looking at each business, Rakuten Card has continued to grow steadily, with revenue increasing by 9.8% YoY to JPY91.2 billion, driven by an increase in shopping GTV, which in turn was a result of an expanding customer base and a rise in average transaction value. Operating income decreased by 4.5% YoY, mainly due to an increase in financial costs on the funding side. However, since about 80% of Rakuten Card's funding comes from Rakuten Bank, the overall performance of the group remains very strong. Rakuten Payment is also performing very well, having achieved the number one customer satisfaction ranking for three consecutive years for the first time in history. The number of users of the Rakuten Pay app continues to increase and transaction volume is also growing, driving a strong expansion in operating income. I believe we are seeing very positive growth in this area. Rakuten Bank has already announced its financial results separately, but in addition to the growth of accounts and deposit balances, it continues to significantly expand its interest income in the current environment of rising interest rates. For the April to June period, ordinary income increased by 40.8% to JPY57.5 billion. Ordinary profit rose by 56.8% to JPY23.9 billion, and ROE was 21.6%. This demonstrates that we are achieving very efficient growth. At Rakuten Securities, the expansion of the customer base driven by the new NISA continues, and we have achieved record high quarterly revenue. Operating income has decreased due to increased costs resulting from increased domestic stock transaction volume. However, since our revenue sources have diversified beyond stocks to include margin trading, bonds, FX and others, we consider this to be within the normal range of quarterly fluctuations. Regarding security, although there have been incidents affecting companies in the industry, we completed all necessary countermeasures by the end of May, including various authentication measures. Since then, there have been no incidents in our service. We hope that after setting up these features, everyone can use our services with peace of mind. Next, regarding the insurance business, both life insurance and general insurance sales are performing well, resulting in increased revenue. We will continue to strengthen our selection and concentration strategy by focusing on products and sales channels tailored to each type of insurance. As for Rakuten General Insurance, losses have increased due to a one-time impact from accounting adjustments. However, we are intensively implementing projects aimed at continued cost control and revenue improvement. Finally, I will explain the Mobile segment. Revenue increased by 18.1% YoY to JPY112.1 billion, with both Rakuten Mobile and Rakuten Symphony showing solid growth. Although operating income remains negative, the magnitude of improvement is significant at JPY16.9 billion. EBITDA improved by JPY21.6 billion YoY, reaching JPY9.6 billion. The segment has turned profitable on an EBITDA basis. I will now explain the business performance of Rakuten Mobile on a stand-alone basis. Revenue increased by 33.5% YoY to JPY90.6 billion, and operating losses are also steadily improving. As I mentioned at the beginning, EBITDA improved by JPY19.1 billion YoY, resulting in a profit of JPY5.6 billion, further expanding the positive profitability from the previous quarter. Pre-marketing cash flow, which is the cash flow from existing subscribers, excluding marketing expenses, reached JPY21 billion this quarter, and this is also expanding nicely. At the end of Q2, the number of subscribers was 8.97 million, and the churn rate for the quarter was 1.4%. Although the churn rate had increased in the previous quarter due to the spring sales season, it is gradually returning to normal. ARPU increased by JPY40 YoY to JPY2,861 and MNO service revenue grew by 26.9%, indicating stable growth. In Q2, the net increase in subscribers was 393,000 with improvements seen in both the number of activations and cancellations, resulting in stronger growth compared to the previous quarter. In H2, we aim to further accelerate the pace of net additions and achieve the milestone of 10 million lines as soon as possible. Regarding churn rate, while the average for Q2 was 1.4%, it improved to 1.26% in June. In addition to the end of the spring sales season, the impact of price revisions by some carriers has also contributed, bringing the rate down to the same level as last autumn. I believe this indicates that customer retention is progressing. ARPU increased by JPY40 YoY to JPY2,861 with data ARPU continuing to be the main driver of growth for both consumer and corporate segments. Net ARPU, which is directly linked to Rakuten Mobile's operating income and EBITDA, increased by JPY114 YoY to JPY2,474. As for ecosystem ARPU, there has been a slight decrease, but this is due to dilution from an increase in new contracts by users who are new to the ecosystem or by light users. Over time, we expect these users to become more loyal, leading to an increase in their ARPU. The average daily data usage for B2C users has now exceeded one gigabyte. In particular, users who activated their service between January and March of this year are consuming even more data, averaging 1.2 gigabytes per day. This is also expected to be a driver for further ARPU growth going forward. In the previous financial results announcement, we shared our plan to add more than 10,000 new base stations within the year to address coverage holes and increase capacity. As of July, we have completed the installation of 2,930 base stations. We will accelerate the pace in H2, aiming to improve network quality, which we believe will lead to faster contract acquisition and a further reduction in churn rate. We have also made significant improvements in network stability. According to a third-party survey, the percentage of time with no signal availability, that is periods when mobile phone connectivity was unavailable, has decreased substantially, catching up with competitors. In addition to improving network quality, we are also strengthening our product offerings. As already announced, starting in October, we will launch the Rakuten Saikyo U-Next package. No matter how many videos you watch or how much data you use, it is a very attractive package at just JPY3,980 per month. We want our ecosystem's loyal users to enjoy even greater benefits with Rakuten Mobile, so we are enhancing perks for Rakuten Card users. Starting in July, we have introduced a program that provides a monthly data discount coupon, five gigabytes for premium card members and 10 gigabytes for Black Card members. Our B2B services are also steadily increasing in customer acquisition. The number of corporate contracts has surpassed 20,000, reaching 21,796 companies as of the end of June. According to an external survey, we have received the top rating among carriers in two categories

cost performance and speed of service activation. We believe that our customers are highly satisfied with both the cost and service aspects. In our discussions with people from various industries, we often hear about challenges that are unique to each sector, and we believe that industry-specific tailor-made packages are necessary. Thus, we have prepared and begun offering these types of industry-specific DX packages. Finally, I would like to provide an update on Rakuten Symphony for this quarter. In Q2, we signed new contracts and established a sales partnership for our products with six companies. In particular, AT&T has been using our product, Rakuten Site Management, which allows for the management of base station deployment through a single application interface, and they have decided to enhance its usage. With this, we believe that our products are steadily gaining recognition within the industry. We have also launched new products, and we will continue to work hard to establish our position in the telecommunications industry, especially as a software vendor for Open RAN. That concludes my presentation. Thank you very much.

This is Hirose, and I will explain our financial strategy. Regarding consolidated business results, revenue increased by 11% YoY to JPY596.4 billion, and non-GAAP operating income increased by JPY31.9 billion YoY to JPY20.1 billion, achieving both higher revenue and profit. As for the main items below non-GAAP operating income, first, in terms of nonrecurring items, Rakuten Card received a notification of correction for consumption tax and local tax. From the Tokyo Regional Taxation Bureau in July 2025 regarding funding transactions related to the securitization of card receivables in previous years. As a result, JPY4.9 billion was recorded as expenses related to additional taxes and delinquency charges, et cetera. In addition, JPY1 billion was recorded as compensation for financial losses incurred by customers due to an unauthorized access at Rakuten Securities. Rakuten Card conducts securitization of card receivables as a means of raising funds. The Company considers them to be borrowings regarding the treatment of consumption tax on these transactions and therefore, untaxable transactions. However, the tax authorities require them to be treated as nontaxable sales, resulting in a discrepancy. In this case, the discrepancy has not been resolved, and the company has taken measures such as additional taxation in response to the notification of correction. Rakuten Card has consistently endeavored to ensure appropriate tax handling in accordance with laws and regulations, seeking advice from external experts and will continue to assert the legality of its tax handling to the tax authorities. Despite these factors, IFRS operating income increased by JPY27.2 billion YoY to JPY8.8 billion. Next, in terms of financial income and expenses, mainly due to fluctuations in hedging gains and losses arising from currency swaps related to foreign currency-denominated perpetual subordinated bonds. There was a decrease in income of JPY29.2 billion. Accounting-wise, perpetual subordinated bonds are classified as equity. And since hedge accounting does not apply, foreign exchange fluctuations are reflected as hedging gains or losses. However, these do not involve cash outflows and are offset by fluctuations in the unrealized gains or losses on perpetual subordinated bonds. So there is no material impact on the financial statements. Corporate income tax expenses increased by 88.6% YoY to JPY19.7 billion, mainly due to Rakuten Card leaving the Group tax consolidation system. As a result of these factors, quarterly net loss was JPY40.1 billion. Next, I will explain our financial strategy. Our financial policy is to enhance corporate value through the establishment of a stable financial base and appropriate capital allocation, and we aim to maintain medium-term financial soundness by continuously improving our credit profile. On the business side, we are working on continuous profit growth in our core businesses, company-wide efficiency improvements and cost reductions and the reduction of working capital. On the financial side, we are reducing interest-bearing debt and proactively managing the redemption schedule of corporate bonds. For specific medium-term financial targets, we aim to keep the ratio of net interest-bearing debt to non-GAAP EBITDA in non-fintech businesses within 5x and to achieve a consolidated equity ratio of 10%. We continue to believe that there is no need to change our financial targets and policies. However, as I will explain on the next slide, in light of the uncertain macroeconomic environment, we are currently conducting our financial operations in a conservative manner. In addition, we have completed the scheduled redemption of JPY400 billion in retail bonds for this year. And as of June 2025, our total interest-bearing debt has decreased by approximately JPY425 billion compared to the end of last year. Recently, we have issued both wholesale bonds and retail bonds in the domestic market. From the perspective of diversifying funding sources in our financial strategy, we position not only overseas markets, but also the domestic capital market, including retail as important funding channels. With regard to the wholesale bonds, we believe that by successfully issuing our first sustainability bond, we have acquired yet another new means of funding. As for retail bonds, amid ongoing uncertainty in the macroeconomic environment, our aim is to conservatively secure on-hand liquidity. We believe that our credit profile is continuously improving. Although uncertainty in the global economy persists, as can be seen from the trends in Japanese government bond yields and our domestic unsecured bond yields, the spread has tightened, which we believe reflects the improvement in our credit profile. In fact, regarding the recently issued retail bonds compared to those issued in 2023, the maturity has been extended, yet the interest rate has tightened. Even in a phase where the base rate, namely government bond yields, is rising, the narrowing of the spread means that we have been able to effectively lower our actual funding costs. This recent issuance of domestic bonds represents a re-access to the domestic capital market, which we believe will contribute to the expansion of our future funding base and is in line with our financial strategy of maintaining medium-term financial soundness. As I explained earlier, our medium-term financial target is to keep the ratio of net interest-bearing debt to non-GAAP EBITDA in non-fintech businesses within 5x. We aim to achieve this target by 2027 through reducing interest-bearing debt, ensuring continuous profit growth in our core businesses and achieving profitability in our mobile business. For the current FY2025, we had previously set the target at around 9x by the end of the year. However, due to progress in EBITDA in the mobile business, the ratio has already reached 9x as of the end of Q2. Therefore, we have revised our target for this fiscal year to around 8.5x. Going forward, we will continue to reduce interest-bearing debt and enhance the cash flow generation capabilities of each business, aiming to bring the ratio within 5x by 2027. Next, our Chief AI and Data Officer, Ting, will explain our initiatives related to AI. Thank you very much.

Hello, everyone. I'm Ting Cai, the Chief AI and Data Officer for Rakuten Group. Today, I will let my avatar share our latest updates with you as an experiment to leverage AI for better efficiency. I'm excited to share the progress we're making on AI-nization, our effort to infuse AI into everything we do for our customers, partners and Rakutenians. Our vision is to augment human creativity with the power of AI by further leveraging our unique data and extensive channels, which are our strengths, we believe we can accelerate our growth flywheel more than ever before. We continue to strengthen our deep learning foundation, invest further in large language models and enhance and expand our consumer-facing and business-to-business services. Today, we'll be presenting the new products and services launched since the Q1. We continue to improve our search quality from semantic search, visual search and now to personalized search. Based on their demographic data, behavioral data, purchase history, brand affinity and other signals, we can now display more relevant search results tailored to each individual user. For example, a simple search for jacket can display completely different search results for different users tailored to each user's characteristics. By returning more relevant results for each user, we were able to engage with users more and increase sales for merchants on Rakuten Ichiba. I want to share a very exciting new launch. We're using Rakuten AI on the Rakuten promotion platform to optimize ad delivery across the ecosystem. By understanding the data we have, we can better match advertising with the relevant audience. This helps to improve both customer experience and advertiser returns. We're also using AI to optimize which channel to deliver ads and when to deliver ads. Search is one of our best channels that demonstrated high returns to advertisers because when you search, the shopping intent is strong and you are more ready to purchase. On other channels where user intent is exploratory in nature, we are reducing the cost per click to improve the return for advertisers. The new platform allows us to make full use of our ad inventory by delivering the right ads to the right customers at the right time on the right channel. It's great for advertisers and great for customers. Thousands of merchants have opted into the program and are seeing higher return on advertising spend. Next, we've also upgraded our recommendation algorithms with factorization machine, which learns hidden user preferences from their behavior and learning to rank, which predicts and ranks the most relevant items for each individual user. As a result, we've seen significant contributions on Rakuten Ichiba in-shop pages and Rakuten Rakuma. In an A/B test conducted on Rakuten Ichiba, we saw purchase volume increase by 26%. On Rakuten Rakuma, a similar A/B test saw an increase of 34%. These results will directly contribute to sales. The numbers are impressive, but the macro level story is even more important. With AI, everyone wins. Customers find exactly what they need faster, merchants sell more and Rakuten earns more revenue. To really understand AI, you have to use AI. This is why we built Rakuten AI for Rakutenians, a suite of AI tools and services to enable everyone at Rakuten to be more creative and more productive. Over 15,000 Rakutenians are using AI every day to get more done and drive more impact. They've created 20,000 custom AI tools and templates across a range of tasks from creating more compelling marketing content to coding, to administrative tasks like managing e-mail and recapping meetings. My favorite part of Rakuten AI for Rakutenians is that the team building AI is using AI to work faster and smarter. By deploying AI tools through the development cycle, from requirement gathering to product definition, prototyping, testing and operations, the Rakuten AI for Rakutenians’ engineering team was able to reduce the time to release by up to 80%. We used to release new features monthly, but now we can do it weekly. High-performance Japanese language LLMs aren't just important to drive business growth. They're a critical strategic asset for Japan. Recently, we were selected by the Ministry of Economy, Trade and Industry and NEDO to join the Generative AI Accelerator Challenge to help achieve that goal. Together, we'll co-create the next generation of open weight foundational AI model for Japan, making the power of AI accessible to everyone. Our shared goal is to build a best-in-class Japanese language model that lifts up all of Japan, pushes the boundaries of AI innovation, reasserts Japan's storied history of technical leadership and innovation. Of particular importance is the enhancement of memory capacity through the use of short-term memory, long-term memory and external memory. AI performance is gradually becoming more commoditized. As this happens, how well it understands you becomes more important than ever. Memory enhancement is essential, and we intend to build lasting relationships with our users based on the value of our ecosystem through these efforts. It's an honor to work on this important project, particularly as we move into the Agentic AI age. On July 30, we also announced a full-scale launch of Rakuten AI and Agentic AI platform. At the heart of Rakuten AI is a library of powerful agents that can help you in your personal and professional life. They are designed to help you tackle a range of daily tasks. Need help getting your research paper started? Use the writing partner. Need to translate an article from Ukrainian to Japanese? Use the AI translator. Need to create an image for a social media post? No problem. The image creator agent can help you with that. Agents can also be active collaborators in more in-depth complex scenarios. The Rakuten shopping agent serves as a personal shopper that can help you find the right outfit or track down a great gift. The adventure planner is like an expert travel agent that can help you map out multiple aspects of a future trip from flights to hotels to places to eat. They're powerful partners, and we can't wait to see what you do with them. We've prepared a short video that offers just a taste of what you can do with Rakuten AI. Please try it out today.