KARADANOTE, INC.

Business Details

Guided by the vision of "Supporting family health, increasing smiles," the company operates a family database (3.44 million members) centered on the pregnancy and childcare demographic, and develops three business areas: Life Event Marketing, Family Support (insurance agency "Kazoku no Hoken," housing-related "Kazoku no Ouchi," etc.), and Family Partnership. Following the divestiture of the bottled water delivery business, the company has pursued selection and concentration toward high-profitability businesses centered on the financial domain, and in the current fiscal year has adopted "establishing a profit-generating structure" as its policy, emphasizing free cash flow and profit margins. All of the company's businesses fall under this single segment.

Recent Overview

Achieved first profit turnaround following completion of structural reform; non-continuous growth in the financial domain anticipated through FPO subsidiary acquisition

For the cumulative nine months of FY2026 (ending March 2026) [August 2025 to April 2026], revenue decreased to ¥731 million (down 32.0% year on year) due to the streamlining of low-margin businesses as part of structural reform, while gross profit margin improved significantly to 72.6% (from 44.9% in the same period prior year), and operating profit turned positive at ¥146 million (compared to a loss of ¥66 million in the same period prior year). The number of Family Data members expanded to 3.44 million (up 13% year on year). On April 15, 2026, a settlement was reached in litigation with FPO Corporation, and on June 1 of the same year, the acquisition of all shares and subsidiary conversion was completed. While the company recognizes that a material event related to going-concern assumptions formally exists, it has determined that no material uncertainty exists. There is no change to the full-year earnings forecast (revenue of ¥1,055 million, operating profit of ¥244 million).

Key Products

Growth Drivers

• Deepening collaboration with Sumitomo Life Insurance Company: KPIs including acquisition of non-insurance services are progressing steadily, joint service development has begun, and the financial domain—now exceeding half of total revenue—is contributing to LTV expansion
• Continued expansion of Family Data membership (3.44 million, up 13% year on year): revitalization of the data platform through expansion into multiple domains such as end-of-life planning and career support, and enhancement of in-app features
• Subsidiary conversion of FPO Corporation (completed June 1, 2026): acquisition of recurring revenue and multi-channel expansion driving non-continuous growth in the financial domain and strengthening the mid- to long-term growth foundation
• Improved profit structure through divestiture of the bottled water delivery business and reduction of low-margin areas: gross profit margin significantly improved from 44.9% to 72.6% year on year
• Increasing social investment in measures to address the declining birthrate and expanding demand for online lead generation in the life insurance and housing industries
• Growing demand for high-quality leads driven by the thorough implementation of customer-oriented business operations and strengthened governance in the life insurance industry, prompting agencies to review their proposal and sales systems
• Improved profit margins and cash generation capability through the shift to management emphasizing free cash flow

Risks

• Material event related to going-concern assumptions: given that operating cash flow was negative for four consecutive fiscal years as of the end of the prior fiscal year, the company recognizes that an event or circumstance giving rise to material doubt exists even as of the end of Q3 (though it currently judges that no material uncertainty exists)
• Structural revenue contraction risk: cumulative Q3 revenue decreased 32.0% year on year due to the streamlining of low-margin businesses as part of structural reform, and the full-year forecast also anticipates a significant 16.9% year-on-year decline
• Dependence on specific customers/domains: the financial domain (collaboration with Sumitomo Life Insurance Company) accounts for more than half of revenue, meaning changes in the partnership relationship directly affect business performance
• Market contraction risk due to the declining birthrate: the absolute size of the core target demographic of pregnant women and childcare households is structurally shrinking, affecting the long-term maintenance and expansion of the data platform
• Goodwill and integration risk associated with the FPO subsidiary conversion: the subsidiary conversion was completed on June 1, 2026, and uncertainty remains regarding the integration process and realization of expected synergies
• Risk of delayed response to intensifying competition and technological innovation in the internet advertising market: the company must respond to intensifying competition in the lead generation market and stricter regulation of data utilization