Recruit Holdings Co., Ltd. (6098) June 24, 2026 Annual General Meeting Transcript

I am Hisayuki Deiko Itakoba, President, Representative Director, and CEO of Recruit Holdings. Today, I would like to discuss these three points. First, I would like to review the consolidated financial results for the 66th fiscal year. For those of you who were here last year, you may remember that at this presentation, we showed a video of AI-powered products under development and shared our plans to launch those services. As you may have seen in TV commercials, these products are already being widely utilized by many business clients and job seekers around the world. Now, as AI is finally improving the user experience, the results are materializing in our actual numbers. And for the 66th fiscal year, both revenue and EBITDA plus S reached record highs. According to our policy of continuous, stable dividends, the annual dividend for the 66th fiscal year was 25 yen per share, a 1 yen increase compared to the previous year, for a total annual dividend of 36.4 billion yen. Next, I would like to talk about our business strategies. The overseas revenue ratio of our group has reached more than 50%, and we are pursuing a global strategy across our entire company. Therefore, you may notice quite a few English terms in our presentation today. We kindly ask for your understanding. This fiscal year, we will continue to pursue our mission, Opportunities for Life. Faster, simpler and closer to you. A mission that provides many new opportunities by proposing more optimal choices and connecting individuals with businesses much faster, surprisingly simpler and closer than ever before. In pursuit of our mission to connect people with opportunities, we have three specific business strategies. Simplify hiring, help businesses work smarter, and prosper together. I will begin with simplify hiring, the strategy of making it easy to get a new job or to make a hire. Ultimately, we believe getting an offer should be as easy as pushing a button. However, in reality, finding the right job or the right talent still takes a lot of work. That's why we're trying to use the power of AI to create a more personalized and efficient experience for job seekers and employers. Today, I will explain in detail how our AI initiatives in HR technology are accelerating our revenue growth. At our earnings call last month, I mentioned that HR matching is a highly unique matching model. Unlike e-commerce sites that sell goods or services, it requires decision-making from both job seekers and employers. That's why, over the past few years, we've been investing heavily in providing AI tools not only for job seekers, but for employers. While data on job seekers' preferences is important, data on which applicants' employers actually hire is critical to increasing hires. So let me share some examples of how we use data from the employer side to improve matching. Sponsored jobs are designed to meet employers' hiring needs. it's an advertising product that shows job ads based on the keywords a user searches for and this matching has been improving dramatically with ai in fact the traditional keyword-based ad format now accounts for less than 30 percent of applications we've evolved to a point where over 70 percent of applications come through ai-driven recommendations and sourcing and outreach tools utilizing AI. For premium-sponsored jobs, where employer adoption has been growing significantly since last year, by matching employers with candidates they'd want to hire right away, we can reduce time to hire by 50% compared with free job posts. Imagine a restaurant with only two chefs, and one suddenly quits. The owner will naturally want to hire a highly skilled chef as quickly as possible. In a situation like this, a chef role is much more likely to use premium-sponsored jobs. And as a result, even though it's more expensive, retention among customers using premium is about 20% higher than for standard-sponsored jobs. we believe this clearly demonstrates the high satisfaction level of hiring employers now looking at the job seeker side what are they struggling with i applied to so many jobs but nobody responded to me a huge number of job seekers are actually struggling with this exact problem actually sponsored jobs serve as one effective solution to solving this problem of applying but receiving no replies. This is because employers highly motivated to hire tend to reply more quickly. Matching companies with high intent to hire with users seriously looking for jobs is extremely important for improving the user experience. In fact, our various applications of AI are leading to tangible improvements in the user experience, and as a result, the number of active job seekers in March increased by 18% year-over-year, reaching a record high. And of course, these matching improvements translate directly into better monetization efficiency relative to hiring demand. In other words, we believe AI-driven improvements in matching are precisely what are delivering strong revenue growth for our business. In the HR matching market, where a lot of manual work still remains, we believe that utilizing AI to automate and simplify the latter stages of the hiring process will help us increase our market share. I believe this is precisely how we will move closer to achieving the realization of simplify hiring, using technological evolution to make hiring so easy, that finding your next job is as simple as a single push of a button. The growth we've achieved through AI-driven improvements in matching, also strengthens my confidence in our future growth. Today, across our global Indeed platform, we're seeing 31 hires per minute, meaning we're helping someone get hired roughly every two seconds. And as we continue to expand our use of AI, we want to do even more to support people around the world in finding their next job. The second strategy is, help businesses work smarter, improving the performance and productivity for business clients in Japan. By driving their sustainable growth, we aim to increase our revenue over the medium to long term. This strategy is driven by Marketing Matching Technologies, or MMT. MMT operates one of the largest matching platforms in Japan, connecting an account base of approximately 99 million recruit IDs of individual users, and approximately 980,000 business clients, across multiple verticals such as beauty and housing and real estate. Individual users with recruit IDs generate a total of approximately 400 million actions annually, and approximately 90% of all these actions are linked to points. Individual users use multiple vertical platforms through this points program, and the cross-use rate exceeds three-fourths. This structure encourages individual users to continue to take actions on our matching platforms. On the other hand, for business clients, our solutions function in beauty and dining as core operating systems that enable the digitalization of operations through integrated business support SaaS solutions. Meanwhile, in housing and real estate and bridal, more than 200 consultation counters nationwide function as offline infrastructure that provides end-to-end support for closing transactions. Operational data, such as sales, reservations, service details, staff utilization, and customer attributes, is accumulated as unique data in the databases of our business support SaaS and consultation counter services. By using this unique data to provide AI-driven proposals tailored to each business client, we aim to increase business clients' gross merchandise value, GMV, on our platforms. Additionally, since last fiscal year, we have been rolling out a GMV-linked revenue model. We will continue to promote, help businesses work smarter, contributing to improving productivity and profitability of our business clients in Japan, and achieving sustainable growth for these clients, which we in turn aim to drive our mid- to long-term revenue growth. And the third strategy is, prosper together, in other words, seeking mutual prosperity with all stakeholders. The company has set five sustainability goals to be achieved over the 10-year period by FY 2030. I would like to introduce one of them. Traditional hiring practices unintentionally create barriers to employment that cannot be solved by speed and matching improvements alone. In response, we set a goal of helping 30 million job seekers facing barriers get hired by FY2030. To achieve this, we have been working to break down six common barriers that affect job seekers globally, including education and disabilities. Indeed, which spearheads our HR technology business, is working to promote the adoption of skills-first hiring, an approach that evaluates candidates based on the skills they have gained through training, professional history, and other past experience, regardless of whether or not they face any barriers. Through these efforts, we successfully helped a cumulative total of approximately 18.8 million job seekers facing barriers get hired through the last fiscal year. We remain committed to reducing barriers in the job market, by promoting skills-first hiring practices. Lastly, I would like to talk about the consolidated financial guidance and dividend guidance for the 67th fiscal year. With regard to our full-year financial guidance for the 67th fiscal year, we expect consolidated revenue to be 4.03 trillion yen which is equal to an increase of 9% year over year, and EBITDA plus S to be 949 billion yen which is equal to an increase of 19.5% year over year. The dividend per share for the 67th fiscal year is planned to increase by 1 yen, compared to the prior year to 26 yen, aligned with our policy of continuous, stable dividends. We will also continue to proactively work to deliver shareholder returns. In the 66th fiscal year, we returned 713.1 billion yen to shareholders through dividends and share repurchases, and our net cash stood at 765.9 billion yen as of the end of March. As for our capital allocation policy for the next three fiscal years starting this fiscal year, we are making no changes to the current order of priorities. We intend to maintain year-end gross cash and cash equivalents at around 750 billion yen. If we execute a strategic acquisition, we intend to fund most of the required amount with debt while taking our credit ratings into account. We will continue to carefully consider whether to execute share repurchases, as well as their scale and timing, while considering strategic M&A in the future, taking into account the trends in the economy and capital markets as well as our financial situation. Regarding the on-site inspection of our domestic staffing subsidiaries by the Japan Fair Trade Commission, I would like to deeply apologize for the concern caused to all of you. As a company, we take the fact that we received this on-site inspection very seriously. Regarding the details of this matter, as we are currently at the stage of fully cooperating with the inspection, we kindly ask for your understanding that it is difficult to provide further explanation at this annual general meeting of shareholders. We will continue to sincerely cooperate with the inspection moving forward. Although US job demand is showing signs of bottoming out from its post-pandemic decline, it remains negative on a year-over-year basis, and economic uncertainty continues. However, as I lead our product development at the forefront of this historic technological revolution driven by AI, what I feel is not anxiety. Instead, I feel a profound sense of conviction and confidence that our mission has never felt more real, and that we are steadily moving closer to achieving it. An extreme future where AI replaces most jobs will not happen overnight. People are still very much needed for work, and people find joy in working. The fundamental demand for work is unchanging, and I am confident that the growth cycle of the job market will return. As Recruit's history has proven, times of change are the absolute best moments to invest in the future. In preparation for the next market recovery, we will seize this major wave of AI innovation while flexibly rethinking even our own ways of operating. We will accelerate the evolution of both our products and our organization. Together as a group, we are fully committed to meeting the expectations of our shareholders and maximizing sustainable corporate value. Thank you very much for your continued support. This concludes my presentation.