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Financial results presentation7725INTER ACTION CorporationElectrical Equipment and Precision Instruments

Financial Results Presentation Materials for the Fiscal Year Ending May 2026

In the fiscal year ended May 2026, revenue and earnings declined due to sluggish sales of IoT-related products to domestic customers and weak sales in the Industry 4.0 promotion business. In the fiscal year ending May 2027, the Company expects substantial increases in revenue and earnings, driven by the recognition of revenue from large overseas orders and other factors.

Worth reading
70In focus
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Direction
Mixed performance
Direction inferred from the company’s description.
Scale
27.7
Year-on-year decrease in revenue (%)
Wording
Avoiding a definitive answer
How definitive the wording is.

Contents of this document

Financial results presentationQ4 of the fiscal year ending May 202613 items taken from the company’s own explanation
Financial Results Figures (The key points of this material are explained below)
Net Sales¥4,822 million-27.7%
Operating profit¥702 million-50.5%
Ordinary income¥835 million-39.7%
Net income¥530 million-45.8%
Gross Profit Margin60.5%; year-on-year change: Not disclosed
Operating profit margin14.6%; year-on-year change: Not disclosed
Results for the three months of the current quarter
Net Sales
¥1,120 million-17.9%
Operating profit
¥43 million-69.9%
Ordinary income
¥38 million-65.6%
Profit attributable to owners of parent for the quarter
¥35 million-54.5%
Operating profit margin
3.9 %
Full-year earnings forecast
Net Sales
¥7,212 million
Operating profit
¥1,599 million
Ordinary income
¥1,620 million
Profit attributable to owners of the parent
¥1,049 million
Earnings per share
¥103.41
Progress against full-year forecast　通期の予想に対して、いまどこまで進んだかの割合です。
Net Sales1.2 %
Operating profit-2.8 %
Ordinary income-2.7 %
Profit attributable to owners of the parent-0.9 %
NotesCompared with the consolidated earnings forecast for the fiscal year ending May 2026, revised as of the third quarter
What the company explained in this material
Self-assessment against the planThe company's self-assessment against its own plan.
Performance was broadly in line with the forecast
Breakdown of Factors Affecting the ChangeReasons cited by the Company for the change in the figures.
Sluggish sales of products to domestic customers in the IoT-related business; weak sales of precision vibration isolation systems and gear testers in the Industry 4.0 promotion business; exclusion of Air Gases Technos from the consolidated accounts; strong sales to overseas customers; and selling, general and administrative expenses exceeding assumptions
Assumptions Underlying the Business OutlookThe assumptions used by the company in preparing its forecast.
The first quarter is expected to remain subdued as it will be a preparation period for large projects, while growth is expected to accelerate in stages from the second quarter onward as large projects and additional orders progress. Numerical assumptions for foreign exchange rates, raw material prices and other factors: Not disclosed.
New initiatives
  • Initiatives targeting physical AI solutions and expansion of the product lineup
  • Development, launch and promotion of 3 semiconductor-related measurement products
  • Planning of 2 new products and identification of partners
  • Expansion of the growth investment budget for the fiscal years ending May 2027 to May 2029 to ¥11 billion
  • A special dividend of ¥10 is scheduled to be paid in the fiscal year ending May 2027
  • Change to a board structure chaired by an outside director
  • The executive compensation system is scheduled to change to BBT-RS
Key KPIsA metric the company considers important as a management benchmark.
  • IoT-related business order intake¥4,566 million
    Year on year against the same period last year+84.2%
  • IoT-related business order backlog¥2,645 million
    Year on year against the same period last year+169.8%
  • Industry 4.0 promotion business order intake¥1,369 million
    Year on year against the same period last year-17.9%
  • Industry 4.0 promotion business order backlog¥382 million
    Year on year against the same period last year+58.2%
  • Base revenue¥755 million
  • ROE (consolidated)4.7 %
Segment results
IoT Business
Net Sales
¥2,952 million-22.9%
Orders received
¥4,566 million+84.2%
Order backlog
¥2,645 million+169.8%
Industry 4.0 Promotion Business
Net Sales
¥1,860 million-9.7%
Orders received
¥1,369 million-17.9%
Order backlog
¥382 million+58.2%
Other (formerly environmental energy business)
Net Sales
¥9 million-98.8%
Medium-term management plan targets
Base revenue
Target value¥3,000 million
Target fiscal yearFiscal year ending May 2030
Gross Profit Margin
Target value50.0% or higher
Target fiscal yearFiscal year ending May 2030
Operating income per employee
Target value¥30 million
Target fiscal yearFiscal year ending May 2030
Operating profit growth rate (CAGR)
Target value15.0% or higher
Target fiscal yearFiscal year ending May 2030
ROE (consolidated)
Target value15.0% or higher
Target fiscal yearFiscal year ending May 2030
Financial targets
Gross Profit Margin
Actual results60.5 %
Target50.0% or higher
Operating income per employee
Actual results¥8 million
Target¥30 million
Operating profit growth rate (CAGR)
Actual results-53.4 %
Target15.0% or higher
ROE (consolidated)
Actual results4.7 %
Target15.0% or higher
Market Size / Share
Physical AI-related application marketSmart factories: US$154.9 billion in 2024 and US$272.6 billion in 2030, approximately 1.8 times larger. Mobility: US$104.6 billion in 2026 and US$378.4 billion in 2033, approximately 3.6 times larger. Wearable AI: US$61.5 billion in 2026 and US$359.3 billion in 2034, approximately 5.8 times larger.
Market expansion potentialMore than ¥1 billion from regaining domestic share in eye modules and developing the South Korean market, and more than ¥3 billion from modifications to light-source equipment
Orders received and order backlog
Consolidated orders received
¥5,935 million+26.4%
Consolidated order backlog
¥3,028 million+102.1%
Number of employees
Number of Employees123 People
As ofEnd of May 2026
Annual Dividend
Annual¥55 per share
Interim¥10 per share
End of period¥45 per share
Year-end special dividend¥10 per share
Acquisition of treasury shares
Acquisition amount1,000 approximately million yen
Contents of this document
ItemDetails
Document typeFinancial results presentation
Fiscal Period CoveredQ4 of the fiscal year ending May 2026
Net Sales¥4,822 million (YoY -27.7%)
Operating profit¥702 million (YoY -50.5%)
Ordinary income¥835 million (YoY -39.7%)
Net income¥530 million (YoY -45.8%)
Gross Profit Margin60.5%; year-on-year change: Not disclosed
Operating profit margin14.6%; year-on-year change: Not disclosed
Results for the three months of the current quarterNet Sales ¥1,120 million (YoY -17.9%) / Operating profit ¥43 million (YoY -69.9%) / Ordinary income ¥38 million (YoY -65.6%) / Profit attributable to owners of parent for the quarter ¥35 million (YoY -54.5%) / Operating profit margin 3.9 %
Full-year earnings forecastNet Sales ¥7,212 million / Operating profit ¥1,599 million / Ordinary income ¥1,620 million / Profit attributable to owners of the parent ¥1,049 million / Earnings per share ¥103.41
Progress against full-year forecastNet Sales 1.2 % / Operating profit -2.8 % / Ordinary income -2.7 % / Profit attributable to owners of the parent -0.9 % / Notes Compared with the consolidated earnings forecast for the fiscal year ending May 2026, revised as of the third quarter
Self-assessment against the planPerformance was broadly in line with the forecast
Segment resultsIoT Business Net Sales ¥2,952 million (YoY -22.9%) / Orders received ¥4,566 million (YoY +84.2%) / Order backlog ¥2,645 million (YoY +169.8%) / Industry 4.0 Promotion Business Net Sales ¥1,860 million (YoY -9.7%) / Orders received ¥1,369 million (YoY -17.9%) / Order backlog ¥382 million (YoY +58.2%) / Other (formerly environmental energy business) Net Sales ¥9 million (YoY -98.8%)
Breakdown of Factors Affecting the ChangeSluggish sales of products to domestic customers in the IoT-related business; weak sales of precision vibration isolation systems and gear testers in the Industry 4.0 promotion business; exclusion of Air Gases Technos from the consolidated accounts; strong sales to overseas customers; and selling, general and administrative expenses exceeding assumptions
Key KPIsIndicator name IoT-related business order intake / Value ¥4,566 million / Year on year against the same period last year ¥84.2 million, Indicator name IoT-related business order backlog / Value ¥2,645 million / Year on year against the same period last year ¥169.8 million, Indicator name Industry 4.0 promotion business order intake / Value ¥1,369 million / Year on year against the same period last year ¥-17.9 million, Indicator name Industry 4.0 promotion business order backlog / Value ¥382 million / Year on year against the same period last year ¥58.2 million, Indicator name Base revenue / Value ¥755 million / Year on year against the same period last year Not disclosed, Indicator name ROE (consolidated) / Value 4.7 % / Year on year against the same period last year Not disclosed
Number of employeesNumber of Employees 123 People / As of End of May 2026
Assumptions Underlying the Business OutlookThe first quarter is expected to remain subdued as it will be a preparation period for large projects, while growth is expected to accelerate in stages from the second quarter onward as large projects and additional orders progress. Numerical assumptions for foreign exchange rates, raw material prices and other factors: Not disclosed.
Medium-term management plan targetsBase revenue Target value ¥3,000 million / Target fiscal year Fiscal year ending May 2030 / Gross Profit Margin Target value 50.0% or higher / Target fiscal year Fiscal year ending May 2030 / Operating income per employee Target value ¥30 million / Target fiscal year Fiscal year ending May 2030 / Operating profit growth rate (CAGR) Target value 15.0% or higher / Target fiscal year Fiscal year ending May 2030 / ROE (consolidated) Target value 15.0% or higher / Target fiscal year Fiscal year ending May 2030
Financial targetsGross Profit Margin Actual results 60.5 % / Target 50.0% or higher / Operating income per employee Actual results ¥8 million / Target ¥30 million / Operating profit growth rate (CAGR) Actual results -53.4 % / Target 15.0% or higher / ROE (consolidated) Actual results 4.7 % / Target 15.0% or higher
Annual DividendAnnual ¥55 per share / Interim ¥10 per share / End of period ¥45 per share / Year-end special dividend ¥10 per share
Acquisition of treasury sharesAcquisition amount 1,000 approximately million yen / Period Not disclosed
Orders received and order backlogConsolidated orders received ¥5,935 million (YoY +26.4%) / Consolidated order backlog ¥3,028 million (YoY +102.1%)
Market Size / SharePhysical AI-related application market Smart factories: US$154.9 billion in 2024 and US$272.6 billion in 2030, approximately 1.8 times larger. Mobility: US$104.6 billion in 2026 and US$378.4 billion in 2033, approximately 3.6 times larger. Wearable AI: US$61.5 billion in 2026 and US$359.3 billion in 2034, approximately 5.8 times larger. / Market expansion potential More than ¥1 billion from regaining domestic share in eye modules and developing the South Korean market, and more than ¥3 billion from modifications to light-source equipment
New initiativesInitiatives targeting physical AI solutions and expansion of the product lineup, Development, launch and promotion of 3 semiconductor-related measurement products, Planning of 2 new products and identification of partners, Expansion of the growth investment budget for the fiscal years ending May 2027 to May 2029 to ¥11 billion, A special dividend of ¥10 is scheduled to be paid in the fiscal year ending May 2027, Change to a board structure chaired by an outside director, The executive compensation system is scheduled to change to BBT-RS
Items this document does not state (7)
Selling, general and administrative expensesUnit price and quantity metricsNumber of stores and locationsRisk amount incorporated into the outlookPayout ratioCapital expendituresKey points of the Q&A

These are items the company does not state in this document. We do not leave them blank, nor fill them in from other sources or by inference.

The reasons the company gives

The company's own explanation, not something inferred from the numbers.

The decline in revenue and earnings in the fiscal year ended May 2026 was primarily attributable to sluggish sales of products to domestic customers in the IoT-related business and weak sales of precision vibration isolation systems and gear testers in the Industry 4.0 promotion business. In the fiscal year ending May 2027, performance is expected to be driven by the recognition of revenue from large orders and additional orders from major overseas customers.

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Financial Results Presentation Materials for the Fiscal Year Ending May 2026 | INTER ACTION Corporation (7725) timely disclosure | Komori