FY2027 first-half results: checking progress toward the full-year loss forecast

Revenue for the first quarter of the fiscal year ending March 2027 was ¥756.537 million, down 12.0% year on year. Operating loss was ¥145.875 million, ordinary loss was ¥146.275 million and net loss attributable to owners of the parent was ¥147.716 million, resulting in losses at all three profit levels. The full-year forecasts are revenue of ¥3,950 million, operating loss of ¥200 million, ordinary loss of ¥250 million and net loss of ¥400 million, and the company had not revised its forecasts as of the first quarter.

Revenue progress against the full-year forecast was only 19.2%, 5.8 percentage points below the 25% elapsed portion of the fiscal year at the end of the first quarter. Operating loss, meanwhile, had reached ¥145.875 million, or approximately 72.9% of the ¥200 million full-year loss forecast. On a simple comparison of amounts, the minimum checkpoints for maintaining the full-year forecast are that revenue reaches at least ¥1,975 million by the end of the first half and that the operating loss does not widen from ¥145.9 million.

Factors behind the first-quarter revenue decline included the absence of some of the government-related Uni-Voice demand seen in the same period of the previous year, Bluetooth product royalty revenue scheduled for the second half, lower contract development revenue due to changes in existing customers' development plans and the postponement of a large government-related project to the second quarter. Accordingly, the first-half results need to show, through project- and product-level revenue disclosures, whether this reflects a loss of demand or merely a shift in the timing of recognition.

Full-year results for the previous fiscal year were revenue of ¥3,924.475 million and operating loss of ¥201.117 million, broadly in line with the current-year forecasts of ¥3,950 million in revenue and ¥200 million in operating loss. With losses continuing for a second consecutive year, the main issues at the next earnings release will be the extent to which the operating loss narrows in the first half, whether the scale of revenue and profit required in the second half is realistic and whether the company explains why it is not revising its full-year forecasts.