Ryoyo Ryosan Holdings, Inc.

Business Details

Centered on Ryosan Company Limited and Ryoyo Electro Corporation (integrated into "Ryosan Ryoyo Corporation" effective April 1, 2026), this segment procures and sells semiconductors and electronic components both domestically and internationally. Its main customer base spans automotive, digital consumer electronics, and industrial equipment applications, and the segment operates globally through a network of subsidiaries spanning Asia, China, the United States, and Europe. It is the group's core business, accounting for approximately 70.8% of consolidated revenue.

Recent Overview

Revenue declined but profitability improved, though the key supplier's notice to terminate the distributor agreement poses a significant risk

Full-year revenue for the Device Business in FY2026 (ending March 2026) declined to ¥254,682 million (down 1.9% year on year), mainly due to lower sales of semiconductors and devices for televisions, office equipment, and industrial equipment. On the other hand, segment profit rose significantly to ¥5,732 million (up 27.9% year on year), driven by an improved sales mix toward higher-margin products, including new business wins. As a subsequent event, on April 2, 2026, Renesas Electronics, a key supplier, notified the company of its intent to terminate the distributor agreement, and discussions are ongoing. As a result, the earnings forecast for FY2027 (ending March 2027) remains undetermined.

Key Products

Growth Drivers

• Medium- to long-term expansion of semiconductor demand driven by AI and DX adoption
• Increased demand for automotive semiconductors driven by progress in vehicle electrification and autonomous driving
• Improved profit margins from a shift in sales mix toward higher-margin products
• Creation of procurement and sales synergies through the integration of Ryosan and Ryoyo Electro (Ryosan Ryoyo Corporation)
• Utilization of a global sales network spanning Asia, the United States, and Europe
• Contribution to future revenue from increased orders received (¥265,269 million in FY2026, ending March 2026, up 11.0% year on year)

Risks

• Risk of significant impact on the sales and procurement structure due to Renesas Electronics' notice to terminate the distributor agreement
• Risk of delayed demand recovery for semiconductors used in automotive and industrial equipment
• Continued weakness in the Chinese market and supply chain disruption from geopolitical risk (sales to China contracted 21.2% year on year to ¥88,044 million)
• Risk of inventory valuation losses due to fluctuations in semiconductor supply-demand balance
• Risk of higher procurement costs due to tariff measures in various countries
• Risk of higher import costs due to yen depreciation