Assess in Q1 whether operating profit can make a sharp recovery to ¥882 million in FY2027

In FY2026, consolidated revenue increased 34.4% year on year to ¥5,864 million, while operating income turned from an operating loss of ¥441 million in the previous fiscal year to an operating profit of ¥179 million. By contrast, the FY2027 company forecast calls for revenue of ¥7,325 million, up 24.9% year on year, and operating profit of ¥882 million, up 394.2%. In addition to revenue growth, the plan calls for the operating margin to rise from 3.0% in FY2026 to approximately 12.0% in FY2027, making Q1 a period for assessing the initial progress of this margin improvement.

However, the full-year forecast currently available does not include standalone Q1 guidance for revenue or operating profit. Accordingly, ¥1,831 million in revenue is merely a mechanical benchmark based on dividing the full-year forecast by 4, not the company’s formal quarterly plan. Revenue from Smart Venue’s facility rentals, events and partnership agreements may be concentrated in particular periods depending on event and contract timing, so it would not be appropriate to conclude that the plan is on track based solely on 25% progress.

The FY2027 forecast calls for ordinary income of negative ¥6 million and net income attributable to owners of the parent of negative ¥44 million, indicating that ordinary and bottom-line income are expected to remain in the red after operating income turns profitable, due to financial expenses and other factors. In Q1, it will therefore be necessary to check not only whether operating profit reaches ¥0 million or more, but also how much of the difference remains between operating profit, ordinary income and net income. If only operating profit improves while the ordinary loss widens, the quality of the full-year forecast will deteriorate.

The results should be reviewed for whether the full-year forecast was maintained or revised, progress rates for revenue and operating profit, and profit contributions by segment. In particular, it will be important to see whether the company discloses which items will drive the planned increase of approximately ¥704 million in operating profit, from ¥179 million in FY2026 to ¥882 million in FY2027, including Smart Venue utilization rates and contract revenue, Mobility MRR and reductions in corporate expenses.