After the sale of the IT staffing business, growth in the cloud-only business becomes the true valuation metric

FY2026 full-year revenue was ¥60.286 billion, comprising ¥51.770 billion from the cloud business and ¥8.516 billion from the IT staffing business. Segment profit was ¥16.027 billion for the cloud business and ¥1.318 billion for the IT staffing business, meaning that the cloud business generated most of the ¥17.345 billion operating profit. Following the transfer of the IT staffing business on 1 April 2026, the company is becoming increasingly focused on the cloud business from FY2027 onward. However, because the prior-year revenue and profit included in consolidated results will be removed, consolidated revenue growth alone will make it harder to measure the underlying strength of the business.

FY2027-Q1 consolidated revenue was ¥14.210 billion, up only 0.9% year on year, while cloud-business revenue was ¥14.210 billion, up 17.8%. The same period last year included ¥2.016 billion of IT staffing revenue, so cloud growth absorbed the revenue decline caused by the IT staffing business no longer being consolidated. However, segment profit was not disclosed for the quarter because the company changed to a single-segment presentation. In FY2027-H1, it will be important to determine whether the company discloses not only standalone cloud-business revenue but also segment profit, operating margin and the allocation of advertising and personnel expenses.

The company’s FY2027 full-year forecast is revenue of ¥59.700 billion, operating profit of ¥20.500 billion and net income attributable to owners of the parent of ¥25.200 billion. Revenue is planned to decline 1.0% from FY2026 actual revenue of ¥60.286 billion, while operating profit is expected to rise 18.2%, assuming improved margins from focusing exclusively on the cloud business after the transfer. The simple H1 revenue benchmark is 50% of the full-year forecast, or ¥29.850 billion, but seasonality and timing differences in revenue recognition have not been disclosed. Judgment therefore needs to be based on cloud-business year-on-year growth as well as simple progress against the forecast.

The first issue to confirm in FY2027-H1 is whether cloud-business revenue is tracking the medium-term plan’s organic-growth assumption of at least 15% CAGR. The second is whether the comparable operating margin after the IT staffing-business sale has improved further from the pre-sale consolidated operating margin of 28.8%. The third is whether the company will continue omitting profit details on the grounds that it has a single segment, or provide supplementary disclosure of cloud-business profit, margins and revenue by service. Without this disclosure, it will not be possible to separate flat consolidated revenue and higher operating profit into sustainable cloud growth and one-off effects from the structural change.