NEOJAPAN Inc.
3921・Prime Market・Information & Communication
Software Business
A high-profit segment centered on groupware, mainly driven by cloud services and license sales
| Period | Current | Previous | Change |
|---|---|---|---|
| Segment sales (cumulative Q1 of FY2027, ending January 2027) | ¥1,581 million | ¥1,499 million (cumulative Q1 of FY2026, ending January 2026) | ↑ |
| Segment profit (cumulative Q1 of FY2027, ending January 2027) | ¥695 million | ¥653 million (cumulative Q1 of FY2026, ending January 2026) | ↑ |
| Cloud service sales (cumulative Q1 of FY2027, ending January 2027) | ¥1,137 million | ¥1,029 million (cumulative Q1 of FY2026, ending January 2026) | ↑ |
| Total cloud service monthly recurring sales (cumulative Q1 of FY2027, ending January 2027) | ¥1,125 million | ¥1,008 million (cumulative Q1 of FY2026, ending January 2026) | ↑ |
| desknet's NEO cloud sales (cumulative Q1 of FY2027, ending January 2027) | ¥930 million | ¥856 million (cumulative Q1 of FY2026, ending January 2026) | ↑ |
| desknet's NEO cloud average monthly churn rate (Q1 of FY2027, ending January 2027) | 0.21% | 0.38% (Q1 of FY2026, ending January 2026) | ↓ |
| AppSuite cloud user ratio (relative to desknet's NEO cloud) | approximately 21% | approximately 17% (up approximately 4 percentage points year on year) | ↑ |
| desknet's NEO average number of users per company | 87 users | – | — |
| Product sales (cumulative Q1 of FY2027, ending January 2027) | ¥426 million | ¥439 million (cumulative Q1 of FY2026, ending January 2026) | ↓ |
| Technology development sales (cumulative Q1 of FY2027, ending January 2027) | ¥18 million | ¥31 million (cumulative Q1 of FY2026, ending January 2026) | ↓ |
Business Details
This business is operated by NEOJAPAN Inc. itself and DELCUI Inc. (a U.S. subsidiary). Centered on the flagship product desknet's NEO, the segment provides groupware cloud services, license sales, support services, and customization. Revenue is composed of Cloud Services (71.9%), Products (27.0%), and Technology Development (1.1%). In the first quarter of FY2027 (ending January 2027), sales were ¥1,581 million (up 5.5% year on year) and segment profit was ¥695 million (up 6.5% year on year), making this the core business boasting a high profit margin.
Recent Overview
Strong cloud performance and improved churn rate drove increased sales and profit in the Software Business, with progress also seen in AI partnerships
In the first quarter of FY2027 (ending January 2027), Software Business sales were ¥1,581 million (up 5.5% year on year) and segment profit was ¥695 million (up 6.5% year on year). Cloud services led the growth at ¥1,137 million (up 10.5% year on year), raising their share of sales to 71.9%. The average monthly churn rate for desknet's NEO cloud improved significantly to 0.21% from 0.38% in the same period of the prior year. AppSuite cloud continued its high growth, up 36.2% year on year. On the other hand, Products (on-premises) declined 2.9% year on year due to a decrease in large-scale licenses, and Technology Development fell 42.3% year on year due to the shrinking of ongoing projects. In the AI field, the company is actively promoting external partnerships, including the three-way business alliance with ZETA, Inc. and LIVEX AI Inc., and the full-text search integration with Brains Technology, Inc.
Key Products
Growth Drivers
- Stable growth in monthly recurring sales driven by an increase in the number of users on desknet's NEO cloud set plans (up 8.6% year on year)
- Increase in the number of AppSuite cloud users driven by expansion of the Standard Plan (approximately 21% relative to desknet's NEO cloud, up approximately 4 percentage points year on year)
- Stabilization of the MRR base through improvement in the average monthly churn rate (from 0.38% to 0.21%)
- Creation of new demand through sales and adoption support for the generative AI product "neoAI Chat for desknet's"
- Entry into the retail media market through the deployment of the AI agent service "LiveX AI" and the three-way business alliance with ZETA, Inc. and LIVEX AI Inc.
- Integration of a generative AI-powered full-text search system with desknet's NEO through the business alliance with Brains Technology, Inc.
- Continued growth in support service sales (up 4.9% year on year)
Risks
- Intensifying competition with rival products and services due to rapid advances in AI technology
- Declining trend in large-scale license deals (total license sales down 17.9% year on year)
- Continued contraction of technology development sales (down 42.3% year on year)
- Risk of rising personnel costs due to intensifying competition to recruit skilled engineers
- Structural decline in on-premises (Product) sales as the shift to cloud progresses
- Impact on the business from changes in the macro environment, such as U.S. trade policy and exchange rate fluctuations
Last updated: April 27, 2026