FY2027-Q1 is the period for assessing the progress of the existing businesses before RINDO's contribution.

FY2026 revenue was ¥51,324 million and operating profit was ¥4,026 million, down 10.1% and 17.2%, respectively, from the previous fiscal year. The operating margin also fell 0.7 percentage points, from 8.5% to 7.8%, making it difficult to say that the decline in revenue and profit seen through the previous fiscal year was reversed by the existing businesses alone. In the next first-quarter results, the first point to confirm will be whether the weakness in the existing businesses has bottomed out, by comparing results with first-quarter revenue of ¥12,765 million and operating profit of ¥1,068 million in the year-earlier quarter.

The initial FY2027 forecast was revenue of ¥51,000 million and operating profit of ¥3,900 million. However, in the earnings forecast revision announced on 28 September, only the revenue forecast was raised by ¥6,000 million to ¥57,000 million, while the operating profit forecast was left unchanged at ¥3,900 million. As the increase in revenue was not accompanied by an increase in the profit forecast, it should be viewed as an increase in revenue scale resulting from a change in the scope of consolidation, rather than an improvement in the profitability of the existing businesses. When assessing first-quarter results, it will also be important not to treat full-year revenue of ¥57,000 million as a growth target for the existing businesses as such.

RINDO Entertainment is scheduled to become an 80%-owned subsidiary through an additional acquisition, with consolidation scheduled to begin in FY2027-Q2. Accordingly, revenue and operating profit from the existing businesses, including games, live entertainment, IP and DX, need to be assessed on the assumption that RINDO's full consolidation contribution is not yet included in first-quarter results. The clarity of the explanation in the first-quarter summary report regarding the scope of consolidation, acquisition timing and the start date for including RINDO's revenue and profit will also affect the comparability of the full-year forecast.

The first quarter should not be assessed solely on year-on-year changes. Key points include whether disclosure covers title-by-title trends in the games business, the breakdown between the VTuber platform and production businesses, recurring monetisation in the DX business, and the operating margin of the existing businesses excluding RINDO. If revenue falls below ¥12,765 million in the year-earlier quarter and operating profit falls below ¥1,068 million, the upward revision to the full-year revenue forecast will appear even more dependent on RINDO's contribution from the second quarter onward.