FY2027 1Q was in line with the full-year plan, but H1 will test whether the earnings growth pace is sustainable

FY2027 1Q revenue was ¥210.455 billion, up 7.5% year on year, and operating profit was ¥41.711 billion, up 12.0%. Operating margin also increased 0.8 percentage points from 19.0% in the same period a year earlier to 19.8%, indicating that growth in domestic systems development projects and operations services contributed to profit, rather than merely increasing revenue scale.

The full-year forecasts are revenue of ¥850 billion, operating profit of ¥175 billion, and profit attributable to owners of the parent of ¥119 billion. First-quarter progress was 24.8% for revenue, 23.8% for operating profit, and 24.5% for net profit. The difference between revenue and operating profit progress was only about 1 percentage point, with no significant delay against the plan as of 1Q. However, the simple H1 half-year figures of ¥425 billion in revenue and ¥87.5 billion in operating profit are not the company's formal interim targets and do not reflect seasonality, so they should be treated as reference points for assessment.

In FY2027-H1, the next period to review, the focus will be whether operating margin can remain around 19% and whether the momentum in Financial IT Solutions and IT Infrastructure Services, which drove first-quarter profit growth, continues. The latest disclosure did not provide order intake, order backlog, or business-specific KPIs such as AI-related services, and the monetary contribution from increased projects was described only qualitatively. Accordingly, the H1 results should provide important supplementary information on earnings sustainability, including whether the full-year forecasts are maintained or revised and trends in backlog, utilization, and individual services.