FY2026 full-year guidance: operating profit is broadly within reach, but revenue depends on acceptance of work in the fourth quarter

For the first 3 quarters of FY2026, revenue was ¥14,311 million, up 16.1% year on year, and operating profit was ¥1,736 million, up 118.9%. Full-year guidance remains unchanged at revenue of ¥20,000 million and operating profit of ¥1,800 million, representing progress rates of 71.6% for revenue and 96.5% for operating profit. Profit is substantially ahead of revenue in terms of progress: the operating margin for the first 3 quarters was approximately 12.1%, compared with 9.0% based on full-year guidance.

Working back from full-year guidance, the fourth quarter requires revenue of ¥5,689 million and operating profit of ¥64 million. The hurdle for operating profit alone is low, but 28.4% of full-year guided revenue remains to be generated. The company has historically disclosed seasonality in telecommunications equipment construction and other businesses, with acceptance of work concentrated from March through August and selling, general and administrative expenses incurred throughout the year. Accordingly, the strong profit progress through the third quarter cannot be equated directly with achieving the full-year revenue target.

Compared with prior-year results, revenue was ¥14,804 million in FY2024 and ¥19,067 million in FY2025, against full-year FY2026 guidance of ¥20,000 million. The plan calls for revenue to increase a further 4.9% after its substantial growth in FY2025. At the next earnings announcement, it will be necessary to check fourth-quarter acceptance results, revenue recognition for incomplete construction projects, and the progress of order backlog conversion. In particular, if operating profit exceeds guidance but revenue falls short, it will be necessary to determine whether profit is temporarily ahead because of progress on high-margin projects or the timing of expense recognition.

Key disclosures to watch at the next earnings announcement include not only results against full-year guidance, but also the segment breakdown of revenue, standalone fourth-quarter operating profit, changes in the timing of acceptance, and changes in the provision for construction contract losses. The company did not prepare a cash flow statement in its third-quarter financial results and has not disclosed full-year operating cash flow, so whether the achievement of profit is accompanied by cash collection can only be confirmed in the annual results.