Recruit Holdings Co., Ltd.

Business Details

Operating in the US, Europe, and Japan as key markets, this segment runs Indeed (the world's largest job listing site) and Glassdoor (a workplace transparency platform). It has built a global talent marketplace with over 665 million job seeker profiles created on Indeed and 3.5 million corporate clients annually. The strategy centers on improving AI-driven matching accuracy and automating the hiring process (Simplify Hiring), monetizing through both pay-for-performance and subscription models. As of April 1, 2025, the staffing/recruitment area of the former Matching & Solutions Segment was transferred to this segment, strengthening integrated operations in the Japanese market.

Recent Overview

EBITDA+S margin improved significantly through monetization evolution and efficiency gains despite sluggish hiring demand

Full-year FY2026 (ending March 2026) segment revenue increased 6.3% year on year to ¥1,454,440 million, and EBITDA+S increased 21.5% to ¥549,995 million. Amid sluggish hiring demand in the US, monetization evolution—including a 17% increase in US average revenue per job—drove an 8.8% increase in revenue on a US dollar basis. EBITDA+S margin improved to 37.7% due to progress in efficiency measures including labor cost reductions. Average hires per minute rose from 27 in 2024 to 31 in 2025. For FY2027 (ending March 2027), HR Technology Segment revenue is projected at ¥1,653,700 million (+13.4% year on year), with an EBITDA+S margin of 41.0%.

Key Products

Growth Drivers

• Monetization evolution in the US market (achieving 17% growth in US average revenue per job even amid sluggish hiring demand, driving an 8.8% increase in revenue on a US dollar basis)
• Revenue expansion in Europe and other regions (up 19.2% on a US dollar basis for full-year FY2026, with +17.1% projected for FY2027 as well)
• Improved EBITDA+S margin (achieving 37.7%, with 41.0% projected for FY2027) through progress in efficiency measures including labor cost reductions
• Improved hiring efficiency for corporate clients (hires per minute increasing from 27 to 31) through AI-driven matching accuracy improvements and hiring process automation (Simplify Hiring strategy)
• Strengthened integrated operation of group staffing/recruitment-related businesses in Japan through Indeed PLUS and Recruit Agent
• Reduced time to hire through AI-driven products such as Indeed Smart Screening (average 20% reduction in time to hire in initial US tests)

Risks

• Risk of stagnant hiring demand in the US market (a softening labor market affecting job volumes, potentially limiting the ability of price increases alone to offset this)
• Declining revenue in the Japanese market (down 4.6% year on year for full-year FY2026, with continued low growth of -0.2% projected for FY2027)
• Foreign exchange risk (yen conversion effects from US dollar, euro, and Australian dollar directly impact results; the assumed rate for FY2027 is ¥154 to the US dollar)
• Intensifying competition amid rapid advances in AI and machine learning technology (competition with global players including LinkedIn)
• Risk of tightening regulations related to individual user privacy protection and data security
• Risk of intensifying competition from emerging players in the recruitment automation market

Business Details

As of April 1, 2025, the staffing/recruitment area was transferred to the HR Technology Segment, and the segment was renamed Marketing, Matching & Technology effective FY2026 (ending March 2026). Through vertical matching platforms in beauty, travel, dining, housing, and other fields, along with business support SaaS (Air Business Tools), the segment has built an ecosystem connecting approximately 98.65 million Recruit ID users with approximately 980,000 corporate clients. It provides integrated support for corporate clients' customer acquisition, reservations, payments, and operational efficiency.

Recent Overview

Beauty-led lifestyle sector drove overall growth, improving EBITDA+S margin to 27.4%

In FY2026 (ending March 2026), revenue increased 4.7% year on year to ¥563,584 million, and EBITDA+S increased 13.0% year on year to ¥154,976 million. The lifestyle sector, including beauty, was the largest growth driver at +6.6%, while the housing sector also grew solidly at +4.5%. For FY2027 (ending March 2027), revenue is forecast at ¥605,000 million (+7.1%), EBITDA+S at ¥181,500 million (+17.1%), and EBITDA+S margin at 30.0%. Transition to a GMV-linked revenue model is being rolled out progressively, starting with the beauty sector.

Key Products

Growth Drivers

• Revenue growth of +6.6% year on year in FY2026 (ending March 2026) in the lifestyle sector, including beauty, travel, dining, and Air Business Tools
• Stable revenue contribution from +4.5% year on year growth in the housing sector (SUUMO, etc.)
• Sophistication of the revenue model through progressive transition to a GMV-linked model (starting with the beauty sector and expanding to multiple verticals)
• Strong user base and expanding action volume (approx. 400 million in FY2025) supported by a cross-use rate exceeding three-quarters via Recruit ID
• Support for maximizing corporate clients' GMV through AI-driven service content and pricing improvement proposals
• Accumulation-type revenue growth from business support SaaS through Air Business Tools
• Profitability improvement targeting an EBITDA+S margin of 30.0% (+2.6pt year on year) in FY2027 (ending March 2027)

Risks

• Risk of declining advertising and reservation demand in beauty, travel, dining, and other sectors due to deterioration in the domestic consumption environment
• Impact on the housing sector (SUUMO, etc.) from rising interest rates and economic fluctuations in the housing market
• Risk of temporary revenue volatility during the transition period to a GMV-linked revenue model
• Intensifying competition and rising customer acquisition costs in SaaS businesses such as Air Business Tools
• Risk of changes in platform value due to shifts in individual users' information gathering and comparison behavior driven by AI adoption
• Reduced comparability with the prior period due to the segment's smaller scale following the transfer of the staffing/recruitment area (caution required when making simple comparisons with FY2025, ended March 2025)

Business Details

Provides staffing services including clerical staffing, manufacturing/light labor staffing, and various professional staffing in Japan, Europe, the US, and Australia. Staff members are pre-recruited and registered, and personnel matching client companies' desired conditions are selected and dispatched. The segment promotes unit-based management both domestically and internationally, aiming to maximize profit by having each unit execute the optimal strategy for its market. It also focuses on automating and improving the efficiency of the hiring process by leveraging the group's matching engine and other technologies.

Recent Overview

Japan revenue grew 5.2%, while overseas revenue was nearly flat, down 0.6%

Revenue in FY2026 (ending March 2026) increased 2.2% year on year to ¥1,703,436 million. Japan grew solidly, up 5.2% to ¥846,800 million, while Europe, the US, and Australia declined 0.6% to ¥856,500 million amid continued sluggish demand in overseas markets. EBITDA+S increased 2.4% to ¥99,744 million, with an EBITDA+S margin of 5.9%. RGF Staffing UK Limited was excluded from the scope of consolidation. For FY2027 (ending March 2027), Japan is expected to grow 3.1% and overseas 8.5%, with total revenue forecast at ¥1,802,500 million.

Key Products

Growth Drivers

• Expansion of staff placements driven by continued growth in domestic staffing demand in Japan
• Expansion of overseas revenue premised on an economic recovery in Europe, the US, and Australia (FY2027 forecast: overseas +8.5%)
• Rapid execution of optimal strategies for each market through unit-based management
• Promotion of hiring process automation and efficiency using the group's matching engine and technology
• Platformization of the staffing market through collaboration with the Simplify Hiring strategy

Risks

• Risk of slowing staffing demand and declining revenue due to an uncertain economic environment in Europe, the US, and Australia
• Margin pressure from rising staff recruitment costs and marketing expenses directed at corporate clients
• Foreign exchange rate fluctuation risk (yen appreciation reduces the yen value of overseas revenue)
• Impact on business operations from changes in labor laws and staffing regulations in each country
• Fluctuations in revenue scale due to portfolio restructuring, including the exclusion of RGF Staffing UK Limited from consolidation