FY2027 revenue forecast raised on DDS agreement, but confirmation of recognized revenue remains the focus

Business revenue for the first quarter of the fiscal year ending March 2027 was ¥4 million, representing progress of approximately 23.5% against the then full-year forecast of ¥17 million. This was approximately 1.5 percentage points below the 25% implied by assuming revenue is generated evenly each quarter, but Ribomic's revenue depends on contract upfront payments and progress in technology evaluations, so it is too early to conclude from this figure alone that the full-year target will be missed. The first point to confirm in FY2027-H1 is whether revenue reaches ¥13 million, the simple 50% benchmark.

It was subsequently reported that the company expects to receive approximately ¥83 million in consideration under an evaluation agreement for DDS aptamer technology with an overseas biotech company, and the full-year business revenue forecast was raised from ¥17 million to ¥26 million. However, total contract consideration is not the same as current-period revenue under accounting rules. The amount recognized in FY2027-H1 may vary depending on when the evaluation begins, when deliverables are transferred, the contract term and whether multiple performance obligations are involved. The full contract amount should therefore not be treated as current-year sales.

In its first-quarter disclosure, the company treated the drug discovery business and related activities as a single segment and did not separately disclose revenue or profit for the drug discovery and drug discovery support businesses. Business revenue was only ¥3 million in FY2026, against research and development expenses of ¥803 million and selling, general and administrative expenses of ¥406 million, making the revenue base extremely small. Accordingly, unless segment-level amounts are disclosed, it will be necessary to assess from the number and term of contracts, payment terms and timing of revenue recognition whether the latest upward revision reflects a one-off evaluation agreement or leads to recurring contract wins in the drug discovery support business.

At the next earnings release, the key items to separate and review will be FY2027-H1 business revenue, the amount recognized under the DDS evaluation agreement, and other contract research and technology evaluation income. It will also be important to see whether the company discloses progress against the ¥26 million full-year forecast, the number of additional contracts, and the mix between contract upfront payments and recurring contract research income. If first-half revenue falls materially below ¥13 million, the company will need to explain whether revenue recognition is weighted toward the second half or the contract itself is limited in scale.