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Introduction & Market Context
Rebase Inc (TSE:5138), the operator of Japan’s largest space matching platform Instabase, reported its first quarter fiscal year 2026 results on August 13, 2025, showing continued revenue growth despite seasonal challenges. The company, which connects users with over 41,000 rental spaces across Japan, demonstrated strong user acquisition while investing heavily in product development.
As shown in the following financial highlights, Rebase achieved double-digit revenue growth but experienced significant profit decline due to increased operational investments:
Quarterly Performance Highlights
Rebase reported revenue of 494 million yen for Q1 2026, representing a 20% year-over-year increase. However, operating profit fell 34% to 61 million yen, while net profit declined 31% to 42 million yen compared to the same period last year. The company attributed this profit decline to investments in strengthening its product development system and costs associated with office relocation.
The quarterly revenue trend shows consistent growth over the past several years, with Q1 typically representing a seasonally slower period for the company:
Operating profit and margin showed significant compression, with operating margin declining from 23% in Q1 2025 to 12% in Q1 2026:
The company’s financial summary reveals that while revenue grew substantially, operating expenses increased at a faster rate, rising from 303 million yen in Q1 2025 to 415 million yen in Q1 2026:
Growth Drivers
Despite the profit decline, Rebase demonstrated strong performance in key operational metrics. The number of users reached an all-time high of 406,000, representing a 29% year-over-year increase. This growth was attributed to increased usage related to lessons, workshops, and business activities.
As illustrated in the following chart showing user growth over time:
The total usage amount on the platform grew 23% year-over-year to 17.0 billion yen, showing healthy activity despite a slight decrease in average unit price to 4.2 thousand yen:
The number of listed spaces continued to expand, reaching 42,000 locations, a 16% increase compared to the same period last year:
Strategic Initiatives
Rebase outlined four key growth strategies for its Instabase platform, focusing on strengthening customer attraction, optimizing user experience, increasing average unit price, and maximizing the number of listed spaces:
The company highlighted several strategic partnerships and initiatives from Q1, including collaborations with Akerun, One Career, and WeWork, as well as the acquisition of UpNow as a subsidiary:
Rebase also articulated its approach to M&A, prioritizing companies that contribute to Instabase’s growth strategies, facilitate expansion of IT platform and real estate capabilities, and support new market entries:
Market Position and Outlook
Rebase estimates the current market size for its services at 3.797 trillion yen, with the company holding approximately 2% market share. The company projects the market will grow to 4.8 trillion yen by 2032, suggesting significant room for expansion:
The company’s Instabase platform serves a diverse range of use cases, with business usage accounting for 73% of activity, while courses and lessons (76%), sports and fitness (76%), and beauty and spa services (84%) represent other significant categories:
Rebase maintains a strong balance sheet with an equity ratio of 70%, providing financial flexibility to support its growth initiatives despite the near-term pressure on profitability. The company’s strategic investments in product development and expansion appear positioned to capitalize on the growing market for flexible space solutions in Japan, though investors will likely monitor whether these investments translate to improved profitability in coming quarters.
Full presentation:
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