Risks of Quality Shortfalls, Delivery Delays, and Cost Increases in Large-Scale, Short-Deadline Contracted Development
First written in FY2017-Q3. 14 of 27 entries say "Mitigated", first in FY2020. Latest entry: 2026-11-06.
The whole theme swung hardest in 2024: 2 of 7 companies on the "Worse" side.
1 other company's latest entry also says "Mitigated".
- FY2027-H1MitigatedAnnual report
「In terms of earnings, in addition to the fading impact of a loss-making project incurred in the first quarter of the previous year, more stringent project management helped contain subcontracted processing costs. As profitability normalized, the Company changed from an operating loss in the year-earlier period to a substantial operating profit.」
The fading impact of loss-making projects and more stringent project management contained subcontracted processing costs, normalizing the profitability of contract development. - 2026-08-05MitigatedResults
「一方、利益面では、前年同四半期に発生した不採算案件の影響が解消し、外注費等の売上原価が減少しました。これにより、売上総利益は黒字に転換し、営業損失も前年同四半期から大幅に縮小しました。」
前年同期に発生した不採算案件の影響が解消し、CuBe事業の売上総利益が黒字化、営業損失も縮小した。 - FY2026MaterialisedAnnual report
「Although the first quarter was affected by the occurrence of an unprofitable project, revenue was concentrated in the fourth quarter, when revenue recognition is weighted, and the business therefore recorded operating profit for the full fiscal year.」
Although unprofitable projects arose due to work hours exceeding estimates and other factors, the concentration of revenue recognition in the fourth quarter was also confirmed in the results, and quality, cost and timing risks associated with contract development continue to materialize. - FY2026-H1MaterialisedAnnual report
「An unprofitable project caused by actual work hours exceeding the estimate arose during the first quarter accounting period, among other factors, and we therefore continued to record an operating loss during the current interim accounting period.」
An unprofitable project caused by actual work hours exceeding the estimate arose and became a factor behind the CuBe business's operating loss. - FY2025MitigatedAnnual report
「In terms of expenses, we achieved some improvement in cost efficiency by thoroughly managing outsourced development from the design stage.」
The company states that it managed outsourced development from the design stage and improved cost efficiency in response to outsourcing, quality and cost risks associated with contract development. - FY2025-H1WorsenedAnnual report
「In terms of costs, we continued working to reduce costs such as the cost of sales, but recorded an operating loss because outsourcing expenses and other costs were incurred upfront. As a result, revenue from the CuBe business was ¥331.813 million, up 17.9% from the same period of the previous year; gross profit was ¥49.417 million, down 30.4%; and operating loss was ¥68.458 million, compared with an operating loss of ¥33.384 million in the same period of the previous year.」
While outsourcing expenses and other costs were incurred upfront and revenue increased 17.9%, gross profit fell 30.4% and the operating loss widened from ¥33.384 million to ¥68.458 million. - FY2024MitigatedAnnual report
「In terms of costs, outsourcing and promotional expenses were incurred upfront, but we continued working to reduce costs such as the cost of sales, resulting in operating profit.」
Although outsourcing and promotional expenses continued to be incurred upfront, the CuBe business recorded operating profit through its efforts to reduce the cost of sales, mitigating the profitability risk associated with contract development from the previous fiscal year. - FY2024-Q3WorsenedAnnual report
「In terms of costs, we continued working to reduce costs such as the cost of sales, but recorded an operating loss because outsourcing and promotional expenses were incurred upfront. As a result, revenue from the CuBe business was ¥394.819 million, up 4.2% from the same quarter of the previous year; gross profit was ¥111.423 million, up 13.2%; and operating loss was ¥43.320 million, compared with an operating loss of ¥42.243 million in the same quarter of the previous year.」
While continuing to reduce the cost of sales, outsourcing and promotional expenses were incurred upfront, and the CuBe business's operating loss widened slightly from ¥42.243 million in the same quarter of the previous year to ¥43.320 million. The risk of costs preceding revenue continues to materialize. - FY2024-Q2MitigatedAnnual report
「In terms of costs, we continued working to reduce costs such as the cost of sales, but recorded an operating loss because outsourcing and promotional expenses were incurred upfront. As a result, revenue from the CuBe business was ¥281.397 million, up 24.1% from the same quarter of the previous year; gross profit was ¥70.963 million, up 35.2%; and operating loss was ¥33.384 million, compared with an operating loss of ¥41.873 million in the same quarter of the previous year. The CuBe business's operating loss includes ¥19.654 million in amortization of goodwill.」
While continuing to reduce the cost of sales, outsourcing and promotional expenses were incurred upfront. The operating loss narrowed from ¥41.873 million in the same quarter of the previous year to ¥33.384 million. - FY2024-Q1MitigatedAnnual report
「In terms of costs, we continued working to reduce costs such as the cost of sales, but recorded an operating loss because outsourcing and promotional expenses were incurred upfront. As a result, revenue from the CuBe business was ¥125.197 million, up 34.8% from the same quarter of the previous year; gross profit was ¥25.572 million, up 55.5%; and operating loss was ¥27.739 million, compared with an operating loss of ¥31.727 million in the same quarter of the previous year.」
Outsourcing and promotional expenses were incurred upfront and the operating loss continued, but revenue and gross profit increased, narrowing the operating loss from the same quarter of the previous year. - FY2023WorsenedAnnual report
「In terms of costs, costs for strengthening competitiveness in development activities and promotional investment in sales activities came first. As a result, revenue from the CuBe business was ¥561.317 million, down 8.8% year on year; gross profit was ¥166.907 million, down 14.2%; and operating loss was ¥19.588 million, compared with operating profit of ¥9.538 million in the previous fiscal year.」
Due to upfront spending on strengthening competitiveness and promotional investment, the CuBe business shifted from operating profit to an operating loss of ¥19.588 million. The risk of higher costs and lower profitability associated with contract development also worsened for the full fiscal year. - FY2023-Q3WorsenedAnnual report
「On the cost side, costs for strengthening competitiveness in development activities and investing in sales promotion activities came ahead of the resulting returns. As a result, revenue from the CuBe business was ¥378.920 million, down 13.6% year on year, gross profit was ¥98.426 million, down 37.3%, and the operating loss was ¥42.243 million, compared with operating profit of ¥16.859 million in the same period of the previous year.」
Upfront costs for strengthening competitiveness and investing in sales promotion reduced revenue and gross profit in the CuBe business. The business shifted from operating profit in the same period of the previous year to an operating loss, worsening risks related to the profitability of commissioned development and cloud services. - FY2023-Q2WorsenedAnnual report
「As a result, revenue from the CuBe business was ¥226.760 million, up 1.5% year on year, gross profit was ¥52.469 million, down 30.4%, and the operating loss was ¥41.873 million, compared with an operating loss of ¥20.930 million in the same period of the previous year. The CuBe business's operating loss includes ¥19.430 million in goodwill amortization.」
In the CuBe business, revenue increased slightly, while gross profit declined 30.4% and the operating loss widened from ¥20.930 million in the same period of the previous year to ¥41.873 million. - FY2022MitigatedAnnual report
「On the cost side, the company worked to improve development efficiency and reduce the cost ratio for each project, resulting in an improvement in the profit margin from the previous fiscal year.」
The profit margin improved through greater development efficiency and lower cost ratios for individual projects, and the CuBe business turned around from an operating loss to operating profit. - FY2022-Q3MitigatedAnnual report
「On the cost side, the company worked to improve development efficiency and reduce the cost ratio for each project, resulting in an improvement in the profit margin from the previous fiscal year. As a result, revenue from the CuBe business was ¥438.358 million, up 25.7% year on year, gross profit was ¥156.975 million, up 53.7%, and operating profit was ¥16.859 million, compared with an operating loss of ¥44.761 million in the same period of the previous year.」
The company worked to improve development efficiency and reduce the cost ratio for each project, improving the profit margin. The CuBe business turned around from an operating loss in the same period of the previous year to operating profit of ¥16.859 million. - FY2022-Q2MitigatedAnnual report
「On the cost side, the company worked to improve development efficiency and reduce the cost ratio for each project, resulting in an improvement in the profit margin from the previous fiscal year.」
The company worked to improve development efficiency and reduce the cost ratio for each project, improving the CuBe business's profit margin from the previous fiscal year. The operating loss continued, however. - FY2022-Q1MitigatedAnnual report
「On the cost side, the company worked to improve development efficiency and reduce the cost ratio for each project, resulting in an improvement in the profit margin from the previous fiscal year.」
The company worked to improve development efficiency and reduce the cost ratio for each project, and stated that the CuBe business's profit margin improved from the previous fiscal year. - FY2021MitigatedAnnual report
「Although delays in business negotiations and implementation work resulting from the spread of the novel coronavirus from the beginning of the fiscal year caused revenue to fall below the same period of the previous year, the company substantially improved its profit margin by strengthening and streamlining its development structure.」
In the CuBe business, revenue declined because of delays in business negotiations and implementation work, while the profit margin improved substantially through improvements and greater efficiency in the development structure. - FY2020MitigatedAnnual report
「The company tightened management of development costs, which had reduced the profit margin in the previous fiscal year, and improved the margin.」
The company stated that it improved the profit margin by tightening development-cost management in response to excess development costs for large projects and other projects in the previous fiscal year. However, the CuBe business continued to post an operating loss. - FY2019RestatedAnnual report
「In commissioned development, revenue declined because fewer large commissioned development projects were delivered than in the previous fiscal year, and the profit margin deteriorated substantially in some projects.」
The decline in deliveries of large commissioned development projects and the deterioration in the profit margin of some projects were also confirmed in the annual results. - FY2019-Q3RestatedAnnual report
「In addition, some large projects incurred development costs above expectations and failed to secure sufficient profit.」
The company continues to report instances in which large commissioned development projects incurred development costs above expectations and failed to secure sufficient profit. - FY2019-Q2MaterialisedAnnual report
「In addition, some large projects incurred development costs above expectations and failed to secure sufficient profit, resulting in a substantial deterioration in the profit margin in the commissioned development field.」
Large projects incurred development costs above expectations, resulting in projects that failed to secure sufficient profit and an actual deterioration in the profit margin in the commissioned development field. - FY2018WorsenedAnnual report
「Meanwhile, selling, general and administrative expenses and cost of sales both increased because commissioned development projects generally became smaller, reducing development efficiency, and the company made proactive investments in cloud-service development, including hiring personnel and changing the allocation of its development structure.」
Cost of sales and selling, general and administrative expenses increased as smaller commissioned development projects reduced development efficiency and the company made upfront investments in cloud development. - FY2017RestatedAnnual report
「As commissioned system development projects become larger and their delivery deadlines shorter, costs may increase beyond expectations if the planned quality cannot be secured or development cannot be completed within the development period. In system development, the company outsources part of its operations to secure production capacity, improve production efficiency and utilize technical capabilities, but productivity or quality may fail to meet expectations.」
The company continues to face risks in commissioned development, including larger-scale projects and shorter deadlines, as well as quality, delivery-time and cost risks arising from outsourcing. - FY2017-Q3First statedAnnual report
「As commissioned system development projects become larger and their delivery deadlines shorter, costs may increase beyond expectations if the planned quality cannot be secured or development cannot be completed within the development period. In system development, the company outsources part of its operations to secure production capacity, improve production efficiency and utilize technical capabilities, but productivity or quality may fail to meet expectations.」
With the launch of the CuBe business, the company disclosed as new risks the increasing scale and shorter deadlines of commissioned system development, along with the possibility of inadequate quality, delivery delays and higher costs arising from outsourcing.