Japanese flea market operator Mercari Inc. today reported Y13.7 billion ($129.6 million U.S.) in losses — attributable to owners of the parent — for the fiscal year ended June 30, 2019. The company attributed the continuous losses to advertising and personnel expenses, according to its financials.

Mercari incurred Y7 billion ($66.3 million U.S.) in losses during the preceding fiscal year. Its operating loss surged to Y12.1 billion from Y4.4 billion, primarily associated with the increase in advertising and personnel expenses.

Its net sales, however, climbed 44.5% year-over-year to Y51.6 billion in FY2019.

Mercari said it plans to actively promote the U.S. and MerPay businesses with the company’s stable and continuous growth in Japan.

“As opposed to the Mercari business in Japan that has a stable earnings base, the U.S. business and Merpay business are still in the investment phase, and these strategic investments could result in an increase in losses recorded under consolidated operating profit/loss and consolidated profit/loss over the short term,” the company said without disclosing its earnings forecast.

Mercari’s monthly active users in the U.S. surpassed 2 million and the gross merchandise volume rose Y16.7 billion to Y40.2 billion after the exchange rate conversion. The company’s gross merchandise volume in Japan increased by Y143.4 billion to Y490.2 billion in FY2019.

Tokyo-based Mercari was founded in 2013. The company is a leading c-to-c marketplace in Japan where its competitors include Yahoo AuctionsJmty.jp, and Rakuma.

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