Declining customer investment appetite and cuts to public-sector system budgets
First written in FY2016. 7 of 24 entries say "Restated". Latest entry: FY2026-H1.
Cyberlinks moved to the "Worse" side of this theme in 2017, 3 years before the typical company in this theme (2020).
The whole theme swung hardest in 2020: 16 of 36 companies on the "Worse" side.
2 other companies' latest entry also says "Other".
- FY2026-H1Revenue and profit growth in the public-sector cloud businessAnnual report
「In the public-sector cloud business, revenue and profit increased due to progress on various projects, including projects related to the unification and standardization of core systems at local governments and disaster-prevention administrative radio construction. As a result, revenue for the current interim consolidated fiscal period was ¥5,125 million, up 23.5% from the previous interim consolidated fiscal period, and segment profit, which is ordinary profit, was ¥1,232 million, up 76.7%.」
Amid the risk of fluctuations in public-sector system investment, progress on projects related to core-system standardization and disaster-prevention administrative radio construction resulted in higher revenue and profit in the public-sector cloud business. - FY2024-H1WorsenedAnnual report
「In the public-sector cloud business, revenue and profit declined because disaster-prevention and network construction projects decreased from the previous interim consolidated fiscal period, despite a contribution from a large system renewal project in the healthcare sector. As a result, revenue for the current interim consolidated fiscal period was ¥3,478 million, down 7.2% from the previous interim consolidated fiscal period, and segment profit, which is ordinary profit, was ¥235 million, down 19.7%.」
Although a large system renewal project in the healthcare sector contributed, the decline in disaster-prevention and network construction projects resulted in lower revenue and profit in the public-sector cloud business. Revenue was down 7.2% year on year, and segment profit was down 19.7%. - FY2024-Q1WorsenedAnnual report
「In the public-sector cloud business, revenue and profit declined because disaster-prevention and network construction projects decreased from the same period of the previous year, despite a contribution from a large system renewal project in the healthcare sector.」
Although a large system renewal project in the healthcare sector contributed, the decline in disaster-prevention and network construction projects resulted in lower revenue and profit in the public-sector cloud business. - FY2023Higher revenue and lower profit in the public-sector businessAnnual report
「In the public-sector cloud business, revenue substantially exceeded the previous fiscal year due to an increase in network construction projects and the contribution of 株式会社シナジー, which became a consolidated subsidiary in the previous consolidated fiscal year. Profit declined, however, because the company recorded ¥248 million in amortization of intangible assets and goodwill identified in the purchase price allocation associated with making 株式会社シナジー a subsidiary.」
The contribution of シナジー and an increase in network construction projects resulted in higher revenue in the public-sector cloud business, but profit declined due to ¥248 million in amortization of intangible assets, goodwill and other items. - FY2022-Q2RestatedAnnual report
「In the public-sector cloud business, revenue declined substantially because the impact of special-demand projects such as the digitization of disaster-prevention administrative radio systems and GIGA School-related projects had largely ended by March 2021, but profit increased as a result of efforts to reduce costs.」
While the substantial revenue decline in the public-sector cloud business due to the end of special-demand projects related to disaster-prevention administrative radio systems and GIGA School continued, profit increased through cost reductions. - FY2022-Q1RestatedAnnual report
「In the public-sector cloud business, revenue declined substantially because the impact of special-demand projects such as the digitization of disaster-prevention administrative radio systems and GIGA School-related projects had largely ended by March 2021.」
The decline in revenue in the public-sector cloud business due to the end of special-demand projects related to the digitization of disaster-prevention administrative radio systems and GIGA School has continued. - FY2021WorsenedAnnual report
「In the public-sector cloud business, revenue declined despite contributions from large system renewal projects in the healthcare information sector, mainly because the response to special-demand projects such as the digitization of disaster-prevention administrative radio systems and GIGA School-related projects was largely completed by March 2021.」
The end of special-demand projects related to disaster-prevention administrative radio systems and GIGA School materialized as lower revenue and profit in the public-sector cloud business. - FY2021-Q3ReframedAnnual report
「In the public-sector cloud business, the company monitors developments in national and local government policies and has established a framework for providing appropriate services in a timely manner, but the business is affected by cuts to public-works budgets, postponed information-system investments, downsizing, policy changes, a decline in the number of local governments due to municipal mergers and other factors, system integration among local governments, and revisions to the bidding system.」
The company organizes the risks of declining customer investment appetite and public-budget cuts by reporting segment, including its framework for monitoring policy developments and providing services appropriately and in a timely manner. - FY2021-Q2WorsenedAnnual report
「The company's response to special-demand projects such as the digitization of disaster-prevention administrative radio systems and GIGA School-related projects was largely completed by March 2021, after which business performance was somewhat sluggish. On a cumulative basis, however, both revenue and profit exceeded the same period of the previous year.」
Special-demand projects related to the digitization of disaster-prevention administrative radio systems and GIGA School were largely completed, after which the public-sector cloud business was somewhat sluggish. On a cumulative basis, both revenue and profit exceeded the same period of the previous year. - FY2021-Q1WorsenedAnnual report
「In particular, if the standardization and common use of local government information systems set out in the Digital Government Implementation Plan, approved by the Cabinet on 25 December 2020, are promoted, the business model for core local government systems could change substantially, which may affect the performance of the group.」
In addition to conventional risks such as public-budget cuts and postponed investments, the company explicitly identified the possibility that standardization and common use of local government information systems could substantially transform the business model for core local government systems. - FY2020-Q2Profit improvement from a higher gross marginAnnual report
「In the public-sector cloud services sector, revenue substantially exceeded the same period of the previous year, supported by demand for construction to digitize disaster-prevention administrative radio systems, which is expected to peak in the current consolidated fiscal year, as well as the contribution of a consolidated subsidiary acquired in the previous consolidated fiscal year. Although expenses increased due in part to measures to strengthen the financial reporting structure at the consolidated subsidiary, profit also exceeded the same period of the previous year, partly because gross margins on construction and system projects improved.」
In addition to demand for construction to digitize disaster-prevention administrative radio systems and the contribution of a consolidated subsidiary, higher gross margins on construction and system projects resulted in higher revenue and profit in the public-sector cloud services business than in the same period of the previous year. - FY2020-Q1Contribution from strong-performing projectsAnnual report
「In the public-sector cloud services sector, revenue substantially exceeded the same quarter of the previous year, supported by steady progress in the digitization of disaster-prevention administrative radio systems, which is expected to peak in the current fiscal year, as well as the contribution of a consolidated subsidiary acquired in the previous consolidated fiscal period. Although expenses increased due in part to measures to strengthen the financial reporting structure at the consolidated subsidiary, profit also exceeded the same quarter of the previous year.」
Amid the risk of fluctuations in public-sector system investment, revenue and profit in the public-sector sector exceeded the same quarter of the previous year due to steady progress in construction for the digitization of disaster-prevention administrative radio systems and the contribution of a consolidated subsidiary. - FY2019-Q3RestatedAnnual report
「In the public-sector cloud services sector, construction projects related to the digitization of disaster-prevention administrative radio systems increased substantially, and revenue exceeded the same period of the previous year. Although the profit margin declined from the same period of the previous year, profit also exceeded the previous-year level.」
Amid the risk of fluctuations in public-sector system investment, revenue and profit in the public-sector sector continue to exceed the same period of the previous year due to an increase in construction projects related to the digitization of disaster-prevention administrative radio systems. - FY2019-Q2RestatedAnnual report
「In the public-sector cloud services sector, construction projects, including the digitization of disaster-prevention administrative radio systems, increased substantially, and both revenue and profit exceeded the same period of the previous year.」
The company continues to disclose that revenue and profit in the public-sector sector exceeded the same period of the previous year due to an increase in construction projects, including the digitization of disaster-prevention administrative radio systems. - FY2019-Q1Increase in public-sector projectsAnnual report
「In the public-sector cloud services sector, construction projects, including the digitization of disaster-prevention administrative radio systems, increased substantially, and both revenue and profit exceeded the same period of the previous year.」
Unlike the profit decline caused by fewer system development and construction projects described through the previous fiscal year, revenue and profit in the public-sector sector exceeded the same period of the previous year due to an increase in construction projects, including the digitization of disaster-prevention administrative radio systems. - FY2018RestatedAnnual report
「In the public-sector cloud services sector, recurring revenue increased steadily, but revenue in the sector was lower than in the previous fiscal year because equipment sales and other revenue declined compared with the previous fiscal year, when projects related to the Local Government Information System Resilience Enhancement Model were recorded.」
The company continues to disclose a situation in which recurring revenue increases in the public-sector sector, while revenue remains below the previous-year level due to a decline in equipment sales and other revenue following projects recorded in the previous fiscal year. - FY2018-Q3Improvement in profitabilityAnnual report
「In the public-sector cloud services sector, recurring revenue increased, but revenue was lower than in the same period of the previous year because equipment sales and other revenue declined compared with the same period of the previous year, when projects related to the Local Government Information System Resilience Enhancement Model were recorded. On the other hand, profit exceeded the same period of the previous year due in part to a relatively higher profit margin.」
Equipment sales and other revenue declined following projects related to the Local Government Information System Resilience Enhancement Model, resulting in revenue below the previous-year level, while profit exceeded the previous-year level due in part to improved profit margins. - FY2018-Q2MaterialisedAnnual report
「In the public-sector cloud services sector, recurring revenue increased, but revenue was lower than in the same period of the previous year because equipment sales and other revenue fell sharply compared with the same period of the previous year, when projects related to the Local Government Information System Resilience Enhancement Model were recorded.」
While recurring revenue increased in the public-sector sector, the decline in equipment sales and other revenue following projects recorded in the same period of the previous year actually occurred, resulting in revenue below the previous-year level. - FY2018-Q1MaterialisedAnnual report
「In the public-sector cloud services sector, recurring revenue increased, but both revenue and profit were lower than in the same period of the previous year due to declines in equipment sales and construction projects.」
Declines in equipment sales and construction projects actually occurred in the public-sector sector, and both revenue and profit were lower than in the same period of the previous year despite higher recurring revenue. - FY2017RestatedAnnual report
「In the public-sector cloud services sector, the company's performance may be affected by cuts to public-works budgets, postponement or downsizing of information-system investments, a decline in the number of local governments due to municipal mergers and other factors, system integration among local governments, and revisions to the bidding system resulting from national or local government policies.」
The company continues to disclose the risks of declining private-sector investment appetite and public-sector budget cuts, postponed investments and changes to the bidding system. - FY2017-Q3RestatedAnnual report
「In the public-sector cloud services sector, although there were equipment sales and other revenue related to the Local Government Information System Resilience Enhancement Model, revenue in the sector exceeded the same period of the previous year due to a decline in system development and construction projects, while profit was lower than in the same period of the previous year.」
The decline in public-sector system development and construction projects has continued to appear as lower profit despite higher revenue. - FY2017-Q2MaterialisedAnnual report
「In the public-sector cloud services sector, although there were equipment sales and other revenue related to the Local Government Information System Resilience Enhancement Model, revenue in the sector exceeded the same period of the previous year due to a decline in system development and construction projects, while profit was lower than in the same period of the previous year.」
The decline in public-sector system development and construction projects has continued to materialize as lower profit despite higher revenue. - FY2017-Q1MaterialisedAnnual report
「In the public-sector cloud services sector, although there were equipment sales and other revenue related to the Local Government Information System Resilience Enhancement Model, revenue in the sector was slightly higher than in the same period of the previous year due to a decline in system development and construction projects, while profit was lower than in the same period of the previous year.」
The decline in public-sector system development and construction projects has materialized as an actual decline in profit, indicating that the risk of lower public-sector system investment has emerged. - FY2016First statedAnnual report
「If a prolonged domestic economic downturn caused by weaker consumer purchasing activity, the declining birthrate and aging population, population decline and other factors reduces customers' willingness to invest in information systems, this could affect the company's performance through sluggish acquisition of new customers and lower orders for additional services from existing customers. In the public-sector cloud services sector, the company's performance may also be affected by cuts to public-works budgets, postponement or downsizing of information-system investments, a decline in the number of local governments due to municipal mergers and other factors, system integration among local governments, and revisions to the bidding system resulting from national or local government policies.」
The company identifies declining private-sector customers' willingness to invest and public-sector budget cuts, postponed investments and changes to the bidding system as risks that could affect performance.