A sharp recovery in the fourth quarter is needed to achieve the full-year plan

Cumulative revenue for the nine months of FY2026 ending September was ¥2,145.3 million, and operating profit was ¥124.8 million. The full-year forecast is ¥3,150 million in revenue and ¥230 million in operating profit, implying progress of 68.1% for revenue and 54.3% for operating profit. Since 75% of the fiscal year had elapsed by the end of the third quarter, operating profit was further behind than revenue, indicating a high dependence on the fourth quarter for earnings.

On a simple calculation, the company needs fourth-quarter revenue of ¥1,005 million and operating profit of ¥106 million to meet its full-year plan. In the previous fiscal year, fourth-quarter revenue was approximately ¥623.6 million, calculated by subtracting cumulative nine-month revenue of ¥2,192.9 million from full-year revenue of ¥2,816.6 million. Operating profit was approximately negative ¥5.2 million, calculated by subtracting cumulative nine-month operating profit of ¥195.6 million from full-year operating profit of ¥190.3 million. Accordingly, fourth-quarter revenue this fiscal year would need to increase by approximately 61% year on year, while operating profit would need to improve by approximately ¥111 million.

For the fourth quarter, the company expects recurring revenue to build as the user base for totono expands and anticipates that upfront investment costs will have run their course. However, it has not specifically disclosed the completion timing for the service transition included in the full-year plan, the amount of recurring revenue, or the fourth-quarter burden from M&A expenses and AI research and development costs. The company left its full-year forecast unchanged in its third-quarter results, but has not quantified the profit required over the remaining 3 months.

At the next FY2026 full-year results announcement, it will be important to disclose standalone fourth-quarter revenue and operating profit and identify the factors behind the plan's achievement, broken down into totono, Sumasapo Thank You Call and other new initiatives. In particular, it will be necessary to determine whether fourth-quarter operating profit of ¥106 million resulted from a recovery in gross profit, a reduction in upfront investment, or temporary revenue. Beyond meeting the full-year forecast, the key issue is whether the fourth-quarter profit level can be sustained into FY2027.