Q1 revenue declined, but profit is ahead of plan; H1 will determine whether demand is recovering

Revenue from April through June 2026 was ¥3,127 million, down from ¥3,367 million in the year-earlier period. Operating profit was ¥58 million, down 1.5% year on year, while ordinary profit rose 1.2% to ¥76 million and profit attributable to owners of the parent rose 3.8% to ¥53 million. The weakness in revenue and the performance at the profit levels are therefore not moving in tandem. The first point to confirm in H1 is whether this combination seen in Q1 was temporary or continued into Q2.

The company's full-year forecasts are revenue of ¥12,500 million, operating profit of ¥150 million, ordinary profit of ¥140 million and profit attributable to owners of the parent of ¥100 million. These forecasts had not been revised as of Q1. Q1 progress was 25.0% for revenue, compared with 38.7% for operating profit, 54.3% for ordinary profit and 53.0% for net profit. This only shows that profit is ahead of revenue at the Q1 stage and does not guarantee that the forecasts will be achieved through the second half. After Q1, the company needs to generate ¥9,373 million in revenue and ¥92 million in operating profit over the remaining 3 quarters to meet its full-year plan.

H1 results in the year-earlier period were revenue of ¥6,123 million and an operating loss of ¥50 million. To match that revenue level based on current-year Q1 revenue of ¥3,127 million, Q2 revenue alone would need to be ¥2,996 million. This is not the company's H1 plan, but merely a benchmark for comparison with the year-earlier period. It is nevertheless useful for assessing whether the Q1 revenue decline continued into Q2. In the next earnings report, we will look for cumulative H1 revenue and operating profit, Q2 standalone revenue and profit, and any revision to the full-year forecasts.