ORO co.,ltd.

Business Details

Primarily targeting project-based businesses (advertising, IT services, consulting, etc.), the segment develops and sells the cloud ERP "ZAC" and "Reforma PSA" for small businesses. The company has built a stable base of recurring monthly revenue through its shift to a SaaS-type monthly billing model. In the first quarter of FY2026 (ending December 2026), revenue was ¥1,503 million (up 12.2% year on year) and segment profit was ¥655 million (up 4.8% year on year), progressing largely in line with the plan.

Recent Overview

In Q1 of FY2026 (ending December 2026), revenue and profit both progressed largely in line with the plan, achieving year-on-year growth in both revenue and profit.

In the first quarter (January to March 2026) of FY2026 (ending December 2026), the Cloud Solutions Business posted revenue of ¥1,503 million (up 12.2% year on year) and segment profit of ¥655 million (up 4.8% year on year), progressing largely in line with the plan. ZAC license fees, maintenance fees, and SaaS monthly service fees grew steadily to ¥1,126 million (up 9.3% year on year). Peripheral products such as dxeco and Semrush also grew strongly, reaching ¥126 million (up 51.0% year on year). On the other hand, the segment profit margin declined to 43.6% from 46.7% in the same period the prior year, reflecting the impact of rising costs. There is no change to the full-year earnings forecast, and the company continues to aim to achieve its plan.

Key Products

Growth Drivers

• Expansion of the recurring monthly revenue base through steady accumulation of ZAC license fees, maintenance fees, and SaaS monthly service fees
• Expansion of ZAC implementation support and customization revenue (¥192 million in Q1 2026, up 11.4% year on year)
• Increase in average revenue per account (ARPA) through the expansion of peripheral solutions such as dxeco and Semrush (up 51.0% year on year)
• Continued growth of Reforma PSA (¥59 million in Q1 2026, up 11.0% year on year)
• Development and provision of new products and services in response to growing corporate demand for DX promotion and AI utilization
• Expansion into overseas markets through the start of ZAC sales in Vietnam in 2026

Risks

• Uncertainty regarding the scale and number of new contracts, including instances where the acquisition of mid-sized projects has fallen short of the initial plan
• Cost increase pressure reflected in the declining trend in segment profit margin (43.6% in Q1 2026 versus 46.7% in the same period the prior year)
• Increased hiring costs and burden of expanding the development organization amid intensifying competition for talent
• Uncertainty in addressing local needs and building sales structures in overseas expansion, including in Vietnam
• Emergence of competing products and changes in the market environment due to the rapid development of new technologies such as generative AI
• Risk of temporary revenue fluctuations due to the timing of revenue recognition of contract liabilities following the shift to the SaaS model