TEAR Corporation

Business Details

Provides funeral execution services not only at funeral halls but also at homes, temples, etc., along with ancillary funeral operations. Builds its customer base around the membership program "Tear no Kai (Membership Program)" and also conducts sales activities targeting affiliated organizations and companies. Hakkoden, Tokai Tenrei, and Tear Hokkaido (formerly Memoria Japan) were brought into the group through M&A, and as of the end of March 2026, the company operated 97 directly-operated halls and 222 group halls in total. In the first half of FY2026 (ending March 2026), external customer sales were ¥10,277 million, representing 90.0% of consolidated sales, making this the core business.

Recent Overview

Both the number of funerals and average revenue per case fell below the prior-year period, with segment profit down sharply by 23.1% year-on-year.

In the first half of FY2026 (ending March 2026) (October 2025 to March 2026), the number of directly-operated funerals decreased 5.4% year-on-year to 8,122 cases. In addition to existing halls falling below the prior-year period, the relocation closure of "Tear Kasadera" also had an impact. On a group total basis, Hakkoden recorded 1,186 cases (down 2.7% year-on-year), Tokai Tenrei recorded 904 cases (up 2.5% year-on-year), and Tear Hokkaido recorded 96 cases. Average funeral revenue per case decreased 1.0% year-on-year, as the rise in floral offering unit prices was offset by declines in altar and ancillary goods unit prices. A higher fixed-cost burden ratio and increased advertising and personnel expenses also weighed on profit, resulting in segment sales of ¥10,277 million (down 4.3% year-on-year) and segment profit of ¥1,834 million (down 23.1% year-on-year).

Key Products

Growth Drivers

• Year-on-year increase in latent funeral demand driven by demographic trends
• Revenue growth effect from the full-year contribution of Tear Hokkaido (became a subsidiary in July 2025, contributing for a full year from FY2026, ending March 2026)
• Increased utilization from the opening of new halls (H1 FY2026, ending March 2026: 2 directly-operated halls, 1 Tokai Tenrei hall, 1 FC hall)
• Expansion of the customer base through growth in "Tear no Kai" membership and strengthened sales activities toward affiliated organizations and companies
• Continuation of the group-formation strategy through M&A (including the consolidation of Kyoso Co., Ltd. as a subsidiary)

Risks

• Declining trend in average funeral revenue per case due to nuclear familyization and shrinking funeral scale (a structural industry issue)
• Continued trend of existing halls falling below the prior-year period in number of funerals, with risk of a rebound decline from the prior-year increase in funeral cases
• Profit pressure from a rising fixed-cost burden ratio and increased personnel expenses due to advertising costs and revisions to the wage system
• Increased goodwill amortization expenses (from M&A deals such as Tear Hokkaido) and risk of impairment losses
• Intensifying competition from the expansion of major funeral companies' service areas and new entrants from other industries