Recruit Holdings shares climbed the most on record after the Japanese owner of Indeed.com forecast stronger-than-projected growth, easing investor concerns that artificial intelligence would disrupt its job-search business.
The stock jumped as much as 19%, its biggest intraday increase since the company went public in 2014, even as the Topix index fell, after issuing an outlook for ?787 billion ($5 billion) in operating profit on ?4 trillion in sales for the fiscal year to March 2027. That exceeds analysts¡¯ average projection for ?723 billion and ?3.9 trillion, respectively.
The rally reflects confidence in Recruit¡¯s HR Technology unit, where Indeed is leveraging AI to improve matching and raising average revenue from each job posting even as hiring demand remains soft. The Tokyo-based company has also been deploying excess cash to buy back its own shares, helping to lift investor sentiment.
¡°Improving this matching through AI creates benefits not only for employers but also for people seeking jobs,¡± Hisayuki Idekoba, Recruit¡¯s CEO, said in a post-results briefing Friday. Monthly active users in March increased 18% year-on-year to a record high, he added.
Recruit has also been rolling out its premium sponsored jobs product, where AI matching can identify high-quality applicants and reduce hiring time by half, according to the company.
Idekoba said AI is already driving measurable improvements despite a weak hiring environment, adding that Recruit¡¯s jobs business should be able to achieve more than 20% revenue growth and EBITDA margins above 50% when hiring demand normalizes.
¡°We highly rate Recruit as a firm that is using AI to improve efficiency and accelerate growth,¡± Keiichi Yoneshima, an analyst at Citigroup Global Markets Japan, wrote in a note.
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