Showcase Inc.

Business Details

A SaaS segment supporting companies' website optimization and conversion rate improvement. It comprises the flagship "NaviCast Series" (including the EFO tool "FormAssist"), the "ProTech Series" for online identity verification/eKYC, the "Omotenashi Suite" platform connecting companies and customers, and joint DX support development (cloud integration) with major corporations. Its customer base spans a wide range of industries including financial institutions, telecom carriers, and secondhand dealers, and it maintains a stable earnings structure centered on subscription-based recurring revenue.

Recent Overview

Profit margin improved significantly due to expanding eKYC demand and improved cost structure, achieving over 400 cumulative adoptions.

In FY2026 (ending March 2026, an irregular 15-month fiscal period), the DX Cloud Business recorded net sales of ¥1,376 million and segment profit of ¥534 million. The profit margin improved substantially to 38.8% from 29.7% in the prior period. The cumulative number of companies adopting ProTech ID Checker surpassed 400, steadily growing against the backdrop of the amendment to the Act on Prevention of Unauthorized Use of Mobile Phones effective April 2026 and the enforcement of the amended Act on Prevention of Transfer of Criminal Proceeds effective April 2027. In February 2025, the company began offering "NaviCast AI-OCR" and "ProTech My Number IC Authentication." Acquisition of "SOC 2® Type 2" certification has enhanced credibility with major financial institutions and others. Depreciation and amortization decreased substantially year over year, and the fading impact of the large-scale impairment (software) recorded in the prior period contributed to the improved profit margin.

Key Products

Growth Drivers

• A sharp expansion in demand for eKYC and My Number card identity verification driven by the amended Act on Prevention of Transfer of Criminal Proceeds scheduled to take effect in April 2027 and the amended Act on Prevention of Unauthorized Use of Mobile Phones effective April 2026
• Revenue expansion from growth in the cumulative number of companies adopting ProTech ID Checker (from over 380 to over 400 companies) and increases in unit price and usage volume
• Enhanced functionality and higher customer unit prices for the NaviCast and ProTech Series through the introduction of new services such as "NaviCast AI-OCR" and "ProTech My Number IC Authentication"
• Accelerated new customer acquisition and improved credibility with major financial institutions and telecom carriers through acquisition of "SOC 2® Type 2" certification
• Expansion of the Cloud Integration Business through DX support deployment to AI Fusion Capital Group companies following participation in the AI Fusion Capital Group
• Continued expansion of the domestic DX market and rapid growth of the non-face-to-face transaction market

Risks

• Revenue volatility risk in the Cloud Integration Business due to lengthening order lead times
• A declining trend in account numbers across the SaaS business overall (impact of services that have been offered for an extended period)
• Risk of additional impairment of fixed assets (software) related to the DX Cloud Business (a large-scale impairment was already recorded in FY2024 (ended December 2024))
• Information security incident risk amid increasingly sophisticated cyberattacks (response being strengthened through SOC 2® Type 2 acquisition)
• Risk of intensifying competition with competitors and delayed response to technological innovation (e.g., generative AI)
• Risk of timing misalignment in demand expansion due to changes or delays in the legal amendment schedule

Business Details

The Information & Communications Business is a business operated by ReYuu Japan Co., Ltd. (TSE Standard: 9425) involving the sale, purchase, and rental of used communication devices such as smartphones, tablets, and personal computers. It operates through both corporate channels and individual-focused online channels. Following the share transfer dated March 25, 2025, ReYuu was excluded from the scope of consolidation, and in FY2026 (ending March 2026, an irregular 15-month fiscal period), only the income statement figures through the first quarter of the consolidated fiscal period are consolidated. This segment has effectively ceased to exist.

Recent Overview

ReYuu was deconsolidated following the share transfer dated March 25, 2025; this segment has ceased to exist.

In FY2026 (ending March 2026; January 1, 2025 to March 31, 2026), ReYuu was excluded from the scope of consolidation following a share transfer dated March 25, 2025 (transfer amount: ¥1,267 million). As a result of the deconsolidation, total assets excluding goodwill decreased by ¥2,005 million, goodwill decreased by ¥109 million, total liabilities decreased by ¥1,146 million, and non-controlling interests decreased by ¥495 million, while investment securities increased by ¥180 million and retained earnings increased by ¥77 million. A gain on sale of shares of affiliated companies of ¥900 million was recorded as extraordinary income. This segment's profit/loss was consolidated only through the first quarter of the consolidated fiscal period, and there will be no further contribution to results going forward.

Key Products

Growth Drivers

• (As this segment has been deconsolidated, there are no future growth drivers)
• Prior to deconsolidation, the establishment of a dedicated procurement department and the development of procurement networks functioned as growth drivers by increasing procurement volume
• Prior to deconsolidation, the development of transaction routes for both sales and procurement in global channels and an increase in transaction volume were expected

Risks

• This segment has already been eliminated from the group's consolidation as a result of the deconsolidation of ReYuu Japan Co., Ltd.
• Even prior to deconsolidation, operating losses had been recorded over multiple periods, reflecting underlying earnings structure challenges that had not led to profitability
• Risk of cost escalation due to difficulty and rising costs in procuring used devices (past instances of procurement difficulty during the COVID-19 pandemic led to deteriorating results)
• The goodwill balance was eliminated due to deconsolidation (¥0 million balance at end of FY2026 (ending March 2026)), resolving the risk of further impairment
• There may remain a risk of valuation losses related to investment securities in ReYuu (recorded at ¥180 million)

Business Details

This segment comprises two pillars: the Owned Media business, which operates multiple SEO media outlets including lifestyle comparison media centered on smartphone information media, and Advertising-Related Services, which provides managed advertising and SNS advertising management services. Revenue is centered on affiliate referral fees and advertising placement fees. While the growth rate compared to the prior consolidated fiscal year is moderate, the segment stably generates net sales and operating profit.

Recent Overview

Moderate year-over-year growth in revenue and profit provided stable performance, while segment assets declined significantly.

In FY2026 (ending March 2026, an irregular 15-month fiscal period), the segment recorded net sales of ¥342 million and segment profit of ¥62 million. While the growth rate compared to the prior consolidated fiscal year (12 months) was moderate, the segment is noted as stably generating net sales and operating profit. Segment assets decreased from ¥48 million at the end of the prior period to ¥24 million. The provision of SNS advertising management and other services continued, maintaining the business foundation.

Key Products

Growth Drivers

• Stable contribution to net sales from Advertising-Related Services through the expansion of SNS advertising management services
• Continuous revenue generation through the stable operation of the SEO media group, including multiple lifestyle comparison media outlets
• Capturing seasonal demand associated with the autumn launch season of new iPhone models

Risks

• Risk of a sharp decline in search traffic due to changes in Google's SEO algorithm (the segment was actually affected by this in the first half of 2024)
• High dependence on revenue from smartphone-related media, exposing performance to fluctuations in the device market
• Due to the nature of the affiliate revenue model, risk of unit price declines resulting from advertisers' budget cuts or the emergence of competing media

Business Details

Operated by the subsidiary Showcase Capital Inc., this segment comprises three pillars: the "SmartPitch" platform, which matches startups with corporations, VCs, and CVCs online; investment and growth support for domestic and international technology ventures; and fundraising support for listed companies. In FY2026 (15 months), fund distribution income expanded, achieving substantial year-over-year growth in both revenue and profit.

Recent Overview

Turned profitable due to substantial expansion in fund distribution income; also pursuing proprietary investment in ReYuu.

In FY2026 (15 months), fund distribution income at Showcase Capital Inc. expanded substantially, resulting in net sales of ¥183 million (versus ¥30 million in the prior period) and segment profit of ¥75 million (versus -¥17 million in the prior period), marking a turnaround to profitability. Other income (mainly fund distributions) expanded roughly sixfold to ¥179,259 thousand from ¥28,643 thousand in the prior period. Meanwhile, revenue from SmartPitch's platform arising from contracts with customers remained at only ¥277 thousand. The company is also pursuing new proprietary investments, including underwriting stock acquisition rights issued through a third-party allotment by ReYuu Japan Co., Ltd.

Key Products

Growth Drivers

• Revenue-boosting effect from the expansion of fund distribution income (approximately sixfold increase year over year in FY2026 (ending March 2026))
• Enhanced platform value from an increase in the number of startups and investors registered on SmartPitch
• Advancement of new proprietary investments, including underwriting stock acquisition rights in ReYuu Japan Co., Ltd.
• Increased demand for investment matching amid the expansion of the startup ecosystem
• Expanded investment opportunities through the utilization of M&A knowledge and expertise gained via participation in the AI Fusion Capital Group

Risks

• Risk of significant performance volatility in adverse market conditions due to a revenue structure dependent on fund distribution income and gains/losses on investment securities valuations
• Extremely small platform revenue from SmartPitch (revenue arising from contracts with customers) at ¥277 thousand in FY2026 (ending March 2026), indicating low self-sustaining core business revenue
• Risk of recording valuation losses on investment securities due to business failures or impairment of value at portfolio startups
• Risk of related-party transactions and conflicts of interest arising from expanded proprietary investment in group affiliates (such as ReYuu)
• Difficulty in period-over-period comparison due to the change in fiscal year-end (irregular 15-month fiscal period), making it difficult to grasp performance trends
• Segment assets decreased from ¥162 million in the prior period to ¥97 million, and the reduction in investment capital may constrain future revenue opportunities

Business Details

The Information & Communications Business, operated by ReYuu Japan Co., Ltd. (TSE Standard: 9425), is a business primarily engaged in the sale of used smartphones. It comprises two sub-segments: the Reuse-Related Business and Other Business. Following the share transfer dated March 25, 2025, ReYuu was excluded from the scope of consolidation, and only the first quarter of the consolidated fiscal period (January–March 2025) is consolidated in the income statement for the current consolidated fiscal year (FY2026, ending March 2026).

Recent Overview

ReYuu was deconsolidated following the share transfer dated March 25, 2025; this segment has been eliminated from the group.

In the current consolidated fiscal year (FY2026, ending March 2026, an irregular 15-month fiscal period), the company partially transferred shares of ReYuu Japan Co., Ltd. on March 25, 2025, excluding it from the scope of consolidation. Only the first quarter (January–March 2025) is consolidated in the income statement. As a result of the deconsolidation, a gain on sale of shares of affiliated companies of ¥900,196 thousand was recorded as extraordinary income. Total assets excluding goodwill decreased by ¥2,005,234 thousand, goodwill decreased by ¥109,102 thousand, total liabilities decreased by ¥1,145,929 thousand, and non-controlling interests decreased by ¥494,873 thousand.

Key Products

Growth Drivers

• As this segment has been deconsolidated, growth drivers for the group have ceased to exist
• Continued holding of investment securities in ReYuu (¥179,500 thousand) as a proprietary investment retains exposure to value fluctuations

Risks

• This segment has already been eliminated from the group's consolidation as a result of the deconsolidation of ReYuu Japan Co., Ltd. in March 2025
• Risk of value fluctuation in the held investment securities in ReYuu (¥179,500 thousand) (a valuation loss on investment securities of ¥39,001 thousand was recorded in the current period)
• Risk of revenue pressure from difficulty and rising costs in procuring used devices (no direct impact on group performance following deconsolidation)
• Risk of intensifying competition and device price fluctuations in the mobile communications market (no direct impact on group performance following deconsolidation)

Business Details

"Other Business" is a business segment not included in the four reporting segments of DX Cloud Business, Advertising & Media Business, Investment-Related Business, and Information & Communications Business, and mainly comprises the Management Administration Outsourcing Business and other operations. It is positioned to serve group-wide administrative and support functions, with a limited revenue scale. In FY2026 (ending March 2026, an irregular 15-month fiscal period), net sales to external customers were ¥30 million (with total sales including intersegment sales at ¥50 million).

Recent Overview

Continued management administration outsourcing function even after ReYuu's deconsolidation; internal sales increased.

In FY2026 (January 1, 2025 to March 31, 2026, an irregular 15-month fiscal period), net sales to external customers were ¥30 million (with total sales including intersegment internal sales at ¥50 million), and segment profit was ¥14 million. Following the deconsolidation of ReYuu Japan Co., Ltd. in March 2025, the Information & Communications Business ceased to exist, simplifying the group structure. Intersegment internal sales changed from ¥30 million in the prior period to ¥20 million [as stated], and the role of the group's internal administrative function continues.

Key Products

Growth Drivers

• Increase in internal sales due to the expansion of management administration outsourcing within the group
• Increased demand for administrative functions accompanying the expansion of DX support to group companies following participation in the AI Fusion Capital Group
• Potential for expanded role through the consolidation of administrative functions following group restructuring (such as the sale of ReYuu)

Risks

• Small segment scale means limited impact on the group's overall performance
• Detailed financial information such as segment assets is undisclosed, making it difficult to assess profitability
• Risk that business content and scale may fluctuate due to changes in group structure (such as the sale of ReYuu)
• The allocation method for company-wide expenses results in large adjustment amounts, making it difficult to grasp the segment's actual standalone condition

Business Details

The "Others" segment consolidates business segments not included in the four reporting segments of DX Cloud Business, Advertising & Media Business, Investment-Related Business, and Information & Communications Business, and mainly corresponds to the Management Administration Outsourcing Business and similar activities. In FY2026 (ending March 2026, an irregular 15-month fiscal period), net sales to external customers remained at approximately ¥29 million, making it a complementary category with limited contribution to the group's overall revenue and profit. Segment assets are disclosed as zero.

Recent Overview

Net sales remained flat while segment profit declined slightly year over year.

In FY2026 (January 1, 2025 to March 31, 2026, an irregular 15-month fiscal period), net sales to external customers were ¥29 million, flat compared to the prior period (¥29 million). Meanwhile, segment profit (operating profit) declined slightly to ¥14 million from ¥16 million in the prior period. Intersegment internal sales decreased to ¥20 million (from ¥29 million in the prior period), which appears to be a contributing factor in the profit decline due to the contraction of intra-group transactions. Segment assets continue to be disclosed as zero.

Key Products

Growth Drivers

• Recording of internal sales associated with management administration outsourcing within the group (intersegment internal sales of ¥20 million)
• Potential expansion of intra-group transaction opportunities following participation in the AI Fusion Capital Group

Risks

• Details of the segment's business content and revenue structure are undisclosed, making independent performance evaluation by investors difficult
• As a complementary category not included in the reporting segments, its priority and future prospects within the group strategy are unclear
• Segment assets are disclosed as zero, making it impossible to evaluate asset efficiency
• Intersegment internal sales have decreased year over year, posing a risk of downward pressure on revenue due to the contraction of intra-group transactions