Half of the full-year forecast consumed in H1; 3Q focus shifts to the likelihood of meeting the forecast after the upward revision

Revenue in the first half was ¥36,651 million, representing 50.0% progress against the full-year forecast of ¥73,300 million revised upward on 31 July. Operating profit was ¥5,497 million, or 52.4% of the ¥10,500 million full-year forecast; ordinary profit was ¥5,824 million, or 53.9% of the ¥10,800 million forecast; and net profit attributable to owners of the parent was ¥4,191 million, or 54.4% of the ¥7,700 million forecast. Revenue and profit both exceeded the simple benchmarks for six months elapsed, and the company is currently tracking the plan following the upward revision.

To achieve the full-year forecast, however, the company must generate revenue of ¥36,649 million and operating profit of ¥5,003 million in the second half. First-half revenue was ¥17,503 million for the SS business and ¥18,619 million for the IA business, with both businesses driving sales. In 3Q, the key question will be whether this high level in the first half was merely brought forward or reflects sustained demand from data centers and other large critical facilities, semiconductors and electronic components, inspection lighting, and industrial PCs.

For a mechanical progress check, 9-month cumulative revenue of ¥54,975 million and operating profit of ¥7,875 million can be used as benchmarks for 75% progress. These are monitoring benchmarks based on simple time apportionment, not company plans that take seasonality into account. The 3Q financial results report should be checked for 9-month cumulative results, the revenue and operating profit still required in 4Q, and whether the full-year forecasts are maintained or revised again.

The first-half earnings presentation materials assume a ¥200 million impact from US tariffs on full-year operating profit, a ¥1,680 million increase in SG&A expenses, and a ¥1,644 million positive impact from foreign exchange. In 3Q, we will assess how much of the tariff impact remains in both the first-half results and the full-year assumptions, whether the plan remains achievable based on sales volume and product mix excluding the benefit of yen depreciation, and how much further cost increases in 4Q are incorporated.