Rakuten Group Inc. said Monday it plans to reorganize its financial units by consolidating its banking, brokerage, credit card and insurance operations as it grapples with mounting losses in its mobile business.
Under its restructuring plan, Rakuten Bank Ltd., Rakuten Securities Holdings Inc., Rakuten Card Co., and Rakuten Insurance Holdings Co. will be integrated into one group by October, the Japanese online retail giant said in a statement. The bank will play the leading role among the units to be streamlined.
File photo shows Rakuten Group Inc.'s headquarters in Tokyo's Setagaya Ward in February 2024. (Kyodo)
Improving collaboration across its fintech businesses, including those for data integration and AI utilization, is "crucial for providing innovative financial services and adding more value to customers," the group company said.
Rakuten Group hopes its financial businesses, which have been showing steady growth, could help increase revenue.
The company said it is now considering canceling earlier plans to float shares of Rakuten Securities, one of the biggest online brokerages in Japan, a move that was intended to improve its financial standing.
Rakuten Bank, which debuted on the Tokyo Stock Exchange's top-tier Prime Market in April last year, will remain listed, the group company said.
The reorganization comes as the technology conglomerate posted a 339.4 billion yen ($2.2 billion) net loss for the year ended December, marking the fifth consecutive yearly loss, due to its struggling mobile business.
The mobile operations of Rakuten, which entered the industry around 2020 to challenge existing giants such as NTT Docomo Inc., have been unprofitable due to the massive investments needed to install base stations nationwide.
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