SoftBank's payment giant PayPay applies for IPO in the US, with a valuation of up to $19.6 billion

SoftBank’s largest mobile payment platform in Japan, PayPay, has officially submitted IPO application documents to U.S. regulators, marking a key step toward its U.S. listing. This fintech company experienced delays due to the U.S. government shutdown but is now resuming its IPO efforts. Market expectations project its valuation to reach $19.6 billion, potentially making it the largest Japanese company to list in the U.S. in history.

After delays, SoftBank’s PayPay restarts its U.S. listing process

Supported by SoftBank Group, PayPay publicly filed its U.S. IPO application this week, planning to list on the Nasdaq under the ticker “PAYP.” The original plan was to go public last December, but regulatory review was delayed due to the U.S. government shutdown, postponing the listing schedule.

If this application proceeds smoothly, it will become the most significant Japanese company U.S. IPO since SoftBank’s semiconductor design company Arm Holdings successfully listed in 2023.

Currently, PayPay has not disclosed the offering size or price range. Reuters previously estimated that this IPO could raise over $2 billion, with the company’s overall valuation reaching approximately 3 trillion yen (about $19.6 billion). Lead underwriters include Goldman Sachs, J.P. Morgan, Mizuho, and Morgan Stanley.

Revenue nearly tenfold growth, poised to energize the U.S. IPO market

In terms of operational performance, as of the nine months ending December last year, PayPay’s revenue reached 278.5 billion yen, with a net profit of 103.3 billion yen, a significant increase from 29 billion yen in the same period the previous year. User base has grown to approximately 72 million registered users.

Matt Kennedy, senior strategist at Renaissance Capital, noted that with revenue growth and profit margin improvements, PayPay has the potential for a premium valuation:

The U.S. IPO market is in urgent need of a victory. A large company like this going public strongly could inject momentum into the relatively subdued market recently.

Holding Binance Japan, PayPay is positioning itself from mobile payments toward a digital financial ecosystem

Founded in 2018 by SoftBank and Yahoo Japan, PayPay initially focused on mobile payments, encouraging Japanese consumers to shift from cash to digital payments through cashback incentives. Over seven years, it rapidly expanded to become one of the most popular payment platforms locally.

Currently, PayPay’s business has extended from payments to credit, banking, securities, and insurance. Last year, it acquired a 40% stake in Binance Japan, integrating crypto asset deposit and withdrawal services. As SoftBank continues to monetize assets and invest in artificial intelligence, PayPay’s IPO is seen as a key part of its capital allocation strategy.

(AI is still hot! SoftBank invests an additional $30 billion in OpenAI and expands funding for Anthropic)

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