Rakuten Securities’ Q1 profit plunges despite flattish revenue

Rakuten Securities’ Q1 profit plunges despite flattish revenue

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Japanese internet conglomerate Rakuten Inc. reported on Thursday the revenue of its broker subsidiary Rakuten Securities stayed flattish both over the quarter and the year to nearly JPY 12.2 billion in January-March of 2016.

The broker’s operating income, however, dropped 20.4% year-on-year to and 9.9% on the quarter to JPY 4.7 billion in the first quarter of the year. This is the lowest value the broker has posted in the past two yearsm except for the second quarter of 2014 when its operating income was slightly over JPY 3.7 million.

Rakuten Securities Q1 2016 revenue

The holding company said its securities services are suffering from the negative impact of volatile market conditions in the stock segment. It refrained from providing a forecast for this segment.

Rakuten Securities saw its forex trading volume at JPY 108.4 billion in the January-March period, increasing by 19.4% from nearly JPY 77 billion in the previous quarter which was the worst for the broker in 2015. The figure includes the volume generated by FXCM Japan Securities since the second quarter of 2015, which Rakuten Securities acquired earlier in 2015.

Rakuten Securities Q1 2016 fx trading volume

Meanwhile, Rakuten Securities’ trading volume from stock broking stood somewhat low at some JPY 11 billion in the first three months of the year, which is 5.6% lower than a year earlier, yet 9.4% higher than in the previous quarter.

Rakuten Securities Q1 2016 stock broking volume

Tokyo-based Rakuten Securities is a multi-asset broker, which product portfolio includes diverse trading instruments, including more than 40 currency pairs, options, futures, commodities, stocks and bonds.

Earlier this month, the broker announced it will include MetaTrader 4 (MT4), the world’s most popular forex trading platform, to its offering, starting end-August this year. It already supports the platforms Market Speed FX and iSpeed FX. The move is rather uncommon, since Japanese forex brokers usually rely on their own, in-house forex platforms.

Rakuten Securities acquired in 2015 from US forex broker Forex Capital Markets, or FXCM, its two units FXCM Japan and FXCM Asia, aka FXCM Hong Kong, which is now branded Rakuten Securities Hong Kong Ltd., or Rakuten Securities HK.

Rakuten Inc. is a holding company and its subsidiaries are active in a number of intenet-based businesses, including finance, retail e-commerce, travel, e-money, and internet banking. It is listed on the Japanese stock exchange.

Source: Rakuten Inc

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