CEO Comment Volume 44, 2010.02
Financial Results for Q2 of Fiscal Year Ending June 2010 and Declaration of New Context Company in the “Real-Time Web Era”
Kaoru Hayashi
President & Group CEO
(Details were explained at the financial results presentation on February 15.)
Highlights of financial results for Q2 of FY ending June 2010
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1. From this quarter, Kakaku.com, Ltd. and DG Communications, Inc. were excluded from consolidation. For operating income, the estimated 1.6 billion yen negative effect of th exclusion of Kakaku.com from consolidation was offset by approximately 400 million yen from the remaining companies.
2. While sales did not meet our initial forecast released at the beginning of the current fiscal year, income outperformed our forecast.
3. Net income improved by 1 billion yen although sales sharply dropped and operating income decreased by 1.1 billion yen compared with the preceding quarter.
Our financial results for the first half of the current fiscal year roughly met our initial projections. While the “Twitter business,” the growth of which we are supporting as a group-wide project, is not expected to start making a full-fledged contribution to profit any earlier than the second half of the year, its B services (for business customers) have started to make progress in conjunction with the U.S. side, as seen in terms of advertising space on the official Japanese Twitter site that is sold out through March.
Creation of Digital Garage’s business value in the real-time web era
The Digital Garage Group advocates “this year’s slogan” and announces it at the general kickoff meeting of all employees every year. We chose the following slogan for this year:
Be part of our Dynamic Ecosystem
"The beginning of the real-time web era"
We defined Twitter, a real-time and next-generation global social network, as the “real-time web.” Our message from that is we will make a contribution to society by being “part of the dynamic ecosystem in the new Internet world,” while going a half step ahead of the innovative changes brought by the network. (The background image was created by in-house designer Yukinori Hidaka, who expressed the multi-faceted aspects of Digital Garage through the image of “Digital Garage Island.”)
In addition to promotional activities for users carried out by our subsidiary, CGM Marketing, Inc. and being led by the “Twitter Company,” our internal organization established at the end of November, the Twitter business has been promoting the diffusion and use of Twitter in Japan as a group-wide project through the Japanese version of Twitter (http://twitter.jp/) and the official Twitter site for Japanese mobile phones (http://twtr.jp/).
As a result, “Twitter” grew remarkably quickly in Japan during the last six months, involving users from not only the business, culture and art worlds, but also mass media and politics, including Prime Minister Hatoyama. Moreover, Twitter continues to grow and expand in Japan at a similar pace to this day. I believe the advent of Twitter, which enables information transmitted from a single consumer to ripple through the world in just a few seconds, seems to be signaling the global arrival of the real-time web era, where both the sender and receiver can instantaneously share information on the same subject, regardless of distance.
Meanwhile, Digital Garage further strengthened its collaboration with Twitter, Inc. of the U.S. by making an approved additional investment (our fourth) on January 26.
The Digital Garage Group will make a sustainable contribution to
society by continuing to provide new business value while carefully
observing and flexibly responding to an environment that changes from
day to day in the real-time web era. We sincerely appreciate your
continued support and guidance for both the Digital Garage Group and
Digital Garage, Inc.
