The interim period remained loss-making, requiring a sharp recovery from the third quarter onward to achieve full-year profitability

Revenue for the interim period of the fiscal year ending December 2026 was ¥388 million, up 1.3% from ¥383 million in the same period of the previous year. Progress against the full-year revenue forecast of ¥836 million was approximately 46.4%, about 3.6 percentage points below the simple 50% benchmark at the halfway point of the year. However, the company has explained that cancellations in its information services business occur around the fiscal year-ends of its main customers, financial institutions and corporations, while additional and new contracts tend to increase in the second half. It is therefore not appropriate to conclude that the company is falling short based solely on a simple time-based allocation.

On the earnings front, the company posted an operating loss of ¥43 million and an ordinary loss of ¥42 million, with losses widening from operating and ordinary losses of ¥35 million and ¥34 million, respectively, in the same period of the previous year. The interim net loss was ¥41 million, narrowing from ¥50 million in the same period of the previous year. As operating and ordinary earnings deteriorated while net income improved, the third-quarter results need to establish whether any improvement in operating earnings reflects improvements in fixed costs and the service mix in the core business rather than temporary extraordinary gains or losses.

The full-year forecasts remain revenue of ¥836 million, operating profit of ¥20 million, ordinary profit of ¥21 million and net profit of ¥18 million, with no revisions at this point. To move from an interim operating loss of ¥43 million to full-year operating profit of ¥20 million, operating earnings must improve by at least ¥63 million in total during the third and fourth quarters. In the fiscal year ended December 2025, the company returned to operating profit of ¥4 million and ordinary profit of ¥5 million, but still posted a net loss of ¥8 million. The key issue is how far the current forecast of profitability will extend through the income statement.

In the next results announcement, we will review not only cumulative revenue progress but also the size of the operating loss, the factors behind improvements in ordinary and net income, and the reasons for maintaining the full-year forecasts. Despite rising segment profit in the information services and advertising agency businesses, the company continues to report a consolidated operating loss. Whether it provides additional disclosure on corporate expenses, other income and expenses, and extraordinary gains and losses will help assess the likelihood of achieving full-year profitability.