Q1 saw growth in both core business segments, but the quality of net income was weak due to the reversal of investment gains.

The first quarter of the fiscal year ending March 2027 covered the 3-month period from 1 April to 30 June 2026. Revenue was ¥1,689 million, up 29.6% year on year, operating income was ¥83 million, up 129.7%, and ordinary income was ¥83 million, up 110.8%. By contrast, net income attributable to owners of the parent was ¥69 million, down 71.5% year on year. Revenue and operating income suggest an improvement in the core business, but net income was affected by non-operating and extraordinary gains and losses, as well as the tax burden.

By segment, the IT Tools business generated revenue of ¥1,006.723 million and segment profit of ¥121.977 million, with revenue up 41.5% year on year and profit up 68.4%. The IT Services business also posted revenue of ¥682.741 million and segment profit of ¥88.706 million, with revenue up 15.3% and profit up 44.6%. Thus, 1Q revenue and profit growth was supported by expansion in both businesses, although the IT Tools business had the higher growth rate. A key point for H1 will be whether this gap narrows.

Net income included an extraordinary gain of ¥84.445 million on the sale of investment securities and a ¥7 thousand gain on the reversal of stock acquisition rights in 1Q. Since net income declined year on year despite the gain on the sale of investment securities, the reversal of one-off gains recorded in the prior-year quarter appears to have been substantial. The quarterly securities report does not show a numerical figure for revenue from the Investment business in its segment revenue disclosure, leaving limitations on the disclosure-based comparability of the Investment business's revenue scale with the core businesses.

At the next interim results announcement, the cumulative revenue and segment profit of the IT Tools and IT Services businesses should be reviewed to determine whether the increase in operating income reflects sustained gross-profit growth or temporarily low expenses. For extraordinary income, the amount and reason for the gain on the sale of investment securities should be confirmed, and the portion of interim net income attributable to owners of the parent generated by ordinary business activities should be separated out.