First-half profit ahead of plan, but 3Q will show how progress reflects the investment burden in the second half

The first half of the fiscal year ending December 2026 produced revenue of ¥2,068 million, up 27.1% year on year, operating profit of ¥382 million, up 45.3%, ordinary profit of ¥384 million, up 45.2%, and interim net profit of ¥283 million, up 45.8%. The full-year forecasts are revenue of ¥4,114 million and operating profit of ¥652 million, putting first-half progress at 50.3% and 58.7%, respectively. Revenue is roughly at the level of six months, while profit has reached just under 60% of the full-year plan, so profit is ahead of plan as of the first half.

However, it is too early to extrapolate the strong first-half performance directly to the full year. The earnings presentation projects second-half revenue of ¥2,045 million and operating profit of ¥269 million, with operating profit expected to decline 9.2% from the previous year's second half. Against first-half operating profit of ¥382 million, the second-half plan of ¥269 million indicates that part of the first-half profit growth will be absorbed by growth investment and higher recruiting-related costs. Maintaining the full-year forecast is positive in itself, but the high first-half profit progress rate does not yet warrant expectations for an upward revision.

Standalone second-quarter results were revenue of ¥1,072 million, operating profit of ¥165 million, ordinary profit of ¥167 million and interim net profit of ¥127 million. Revenue and profit increased year on year, but operating profit growth was limited to 20.6%, below the 45.3% increase for the first-half cumulative period. Standalone second-quarter gross margin was 46.0%, down 0.2 percentage points year on year, while the first-half cumulative margin was 48.9%, up 2.3 percentage points. In 3Q, it will be necessary to determine whether quarterly profitability is improving again or whether costs are increasing ahead of revenue as assumed in the second-half plan.

For the next earnings release, progress should be assessed against nine-month revenue of ¥3,085.5 million, equivalent to 75% of the full-year forecast, and operating profit of ¥489 million. It will also be important to see whether the full-year forecasts of ¥4,114 million in revenue and ¥652 million in operating profit are revised, whether the assumption of ¥269 million in second-half operating profit remains intact, and whether actual recruiting and capital investment spending is disclosed. Even if operating profit is ahead of plan, if second-half cost increases exceed expectations, both the margin outlook and full-year landing will need to be reassessed.