Rakuten’s shares plunge after mobile losses fuel investor fears

JUST IN: Rakuten shares plunge as much as 12%, their biggest intraday drop since April last year, after mounting mobile-unit losses spook investors.

Rakuten shares just cratered 12 percent, the worst drop in over a year. And here's the twist, it happened in the same week the company posted its first net profit in six years. Investors looked past the good news, straight at the mobile unit, and did not like what they saw.

The rest of the business is genuinely humming. Fintech profit up 59 percent, internet services up 57 percent. But founder Hiroshi Mikitani bet big on Japan's wireless market six years ago, and that unit is still bleeding at basically the same rate as last year. Same wound, same bandage, and the debt keeps piling up.

Even Morgan Stanley's polite version was that mobile earnings growth was slightly weak. The stock was already down 14 percent this year before Wednesday. So the question that actually matters is whether Mikitani can finally stop the bleeding. Does Rakuten's mobile segment post a quarterly operating profit at its next earnings report?

This is Dave King, reporting for HIT.

Source Read the original reporting at japantimes.co.jp