Timee Q3 FY25 slides reveal 30.5% revenue growth, raises full-year profit forecast

Introduction & Market Context

Timee Inc. (215A) presented its third-quarter financial results for fiscal year 2025 on September 11, showing continued strong growth despite signs of moderation in some sectors. The company, which operates a platform connecting businesses with temporary workers, continues to benefit from Japan’s persistent labor shortage while implementing effective cost containment measures.

The stock closed at 2,129 yen on the presentation day, up 1.46% following the release of results that exceeded profit forecasts despite slightly missing revenue expectations.

Quarterly Performance Highlights

Timee reported robust financial performance for the third quarter, with net sales reaching 8.36 billion yen, representing a 27.3% year-over-year increase. More impressively, operating profit surged 70.6% to 1.83 billion yen, exceeding the company’s forecast range of 1.73-1.77 billion yen. This resulted in an operating profit margin of 21.9%, higher than the projected 20.6-20.7%.

As shown in the following financial highlights, the company’s year-to-date performance through the third quarter was equally strong:

For the first nine months of FY25, Timee achieved net sales of 24.8 billion yen, up 30.5% year-over-year, while operating profit jumped 82.5% to 5.0 billion yen. The company maintained a high average take rate of 29.1% and a solid fill rate of 86.1%, demonstrating its ability to efficiently match workers with job openings.

The company’s performance relative to its forecast shows that while net sales came in slightly below expectations, operating profit significantly exceeded projections:

Detailed Financial Analysis

Timee’s financial results reveal several important trends. The company has maintained consistent growth in transaction volume, which increased 27.9% year-over-year to 28.36 billion yen in the third quarter. This growth has been primarily driven by the logistics sector, which continues to utilize Timee’s services due to their cost advantages compared to traditional dispatch services.

The following chart illustrates the steady expansion of transaction volume across different industries:

Notably, the company has maintained a stable and high take rate of approximately 29.3%, which has supported revenue growth despite some moderation in transaction volume growth. This consistent take rate across different industries indicates strong pricing power:

Timee’s active client accounts grew 26.5% year-over-year, with steady growth across major industries. The company has also achieved a slight increase in transaction volume per active account, growing 1.1% year-over-year to 131.7 thousand yen, suggesting improved client engagement and usage.

Cost control has been a significant factor in Timee’s improved profitability, as shown in the following breakdown:

Strategic Initiatives

Timee outlined several strategic initiatives aimed at maintaining its market leadership and driving future growth. The company is focusing on establishing an "overwhelming No.1" position in the industry despite increasing competition, highlighting its 86% fill rate, 64% repeat worker rate, and large sales force of 741 representatives as key competitive advantages.

Industry diversification remains a priority, with particular emphasis on the elderly care sector, which saw transaction volume grow by an impressive 147% year-over-year. The hotel industry also showed solid growth of 21.2% year-over-year, as Timee works to establish these sectors as additional growth pillars beyond its core markets.

The company is also expanding geographically through collaborations with local governments and chambers of commerce, which has shown promising results in areas like Nikko City and Kutchan Town.

One of Timee’s innovative initiatives is its "Onboarding Burden Reduction Project," which aims to simplify the worker onboarding process. This project has shown strong results, with job openings growing 1.8 times year-over-year:

Additionally, Timee is developing a new service called "Timee Resume," which leverages user work history data to automatically generate resumes, potentially streamlining the recruitment process for both workers and employers.

Forward-Looking Statements

For the fourth quarter, Timee forecasts net sales of 9.31-9.47 billion yen, representing year-over-year growth of 18.5-20.6%, and operating profit of 1.67-2.03 billion yen, up 15.3-40.1% year-over-year:

The company has revised its full-year forecast, slightly lowering revenue expectations while raising profit projections. The updated forecast calls for annual net sales of 34.13-34.30 billion yen (down 0.7-3.9% from previous forecast) and operating profit of 6.77-7.13 billion yen (up 6.3-12.9% from previous forecast):

This revision reflects Timee’s successful cost containment efforts and operational efficiency improvements, which have more than offset the slight moderation in revenue growth. The company now expects an operating profit margin of 19.8-20.8%, compared to the previous forecast of 17.4-18.8% and significantly higher than the 15.8% achieved in FY24.

While Timee continues to benefit from Japan’s serious labor shortage, the company noted that the logistics industry may perform more weakly in the coming quarter, and there’s no clear recovery yet in some sectors. Nevertheless, the company remains focused on its growth strategy of vertical expansion in key industries, horizontal expansion into new regions, and creating non-linear growth through technological innovation and potential M&A opportunities.

Full presentation:

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