Rakuten Group (TSE:4755): Assessing Valuation After Announcing ¥27 Billion Impairment for Q3 2025

Rakuten Group (TSE:4755) announced it expects to record an impairment loss of about JPY 27 billion in its third quarter results, putting a spotlight on how this move could impact short-term financials.

See our latest analysis for Rakuten Group.

This latest impairment announcement follows a stretch where Rakuten’s share price has shown modest movement, with 90-day and year-to-date share price returns both positive. This signals that momentum is building despite some ongoing business challenges. Over the last three years, long-term total shareholder return has been solidly positive, suggesting investors who stuck with the stock have generally been rewarded.

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With the impairment news and recent share price gains in mind, investors have to ask: is Rakuten Group now trading below its true value, or is the market already baking in expectations for future growth?

Most Popular Narrative: 2.1% Undervalued

Rakuten Group’s narrative-led fair value sits just above the latest close price. This suggests that, by analyst assumptions, the shares may have room to run. The story behind this calculation points to transformative changes at the business’s core, hinting at future catalysts investors should consider.

The adoption of advanced telecommunication technologies and strategic partnerships are set to improve Rakuten Mobile's network quality. This is expected to increase subscriber ARPU (Average Revenue Per User) and drive future revenue growth. Rakuten Symphony's strategic partnerships and technology offerings in private cloud solutions could boost earnings substantially as more global companies look to adopt efficient and innovative telecommunications technology, enhancing Rakuten Group's earnings growth.

Read the complete narrative.

What is the secret sauce behind this price target? The narrative centers on bold profit margin expansion and significant technology bets. Want to see which numbers forecast such a dramatic turnaround? Unlock the full story and discover what fuels this valuation.

Result: Fair Value of ¥979 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, profitability at Rakuten Mobile remains uncertain, and any challenges in sustaining financial flexibility could quickly reverse the current optimism.

Find out about the key risks to this Rakuten Group narrative.

Build Your Own Rakuten Group Narrative

If you see the story differently or want to investigate the numbers on your own terms, you can shape your own narrative in just a few minutes. Do it your way

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Rakuten Group.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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