Orders and demand remain solid, but staff expansion and investment in new features are weighing on interim-period margins

Revenue from January through June 2026 was ¥3,887.297 million, up ¥41.391 million, or 1.1%, from ¥3,845.906 million in the year-earlier interim period. Operating profit, however, was ¥339.400 million, down ¥79.509 million, or 19.0%, from ¥418.909 million a year earlier. Calculated as a percentage of revenue, the operating margin fell by approximately 2.2 percentage points, from about 10.9% in the year-earlier interim period to about 8.7% in the current interim period. The key change in these results was the substantial decline in profit despite the revenue base being maintained.

Interim-period progress against the full-year forecast was approximately 49.8% for revenue, calculated as ¥3,887.297 million ÷ ¥7,800 million; 42.4% for operating profit, calculated as ¥339.400 million ÷ ¥800 million; and 43.1% for net profit, calculated as ¥249.864 million ÷ ¥580 million. Revenue had reached roughly half the full-year forecast, while profit progress was lower. To meet the full-year forecast, the amounts required in the second half on a simple calculation are ¥3,912.703 million in revenue, ¥460.600 million in operating profit and ¥330.136 million in net profit. The simple 75% progress benchmarks for cumulative third-quarter results are ¥5,850 million in revenue and ¥600 million in operating profit.

The company explained that operating profit declined because, although demand for new implementation projects and replacement demand from existing customers remained solid, it was focusing on strengthening its staffing structure and investing in the development of new functions. However, it has not disclosed a breakdown by factor showing how many millions of yen each of personnel-related costs, new-feature development costs and other investment expenses reduced profit. The reported business consists of a single systems business segment, so segment margins and product-level profitability cannot be assessed.

The full-year forecasts of ¥7,800 million in revenue, ¥800 million in operating profit, ¥854 million in ordinary profit and ¥580 million in net profit, together with the ¥10 annual dividend forecast, remained unchanged as of the interim results. In the third quarter, it will be important to assess not only whether profit progress approaches the simple benchmark of ¥600 million, but also whether the operating margin has recovered from 8.7%, whether the increase in investment costs has run its course, and whether stronger demand is converting into profit.