Key Positives From The Results
Revenue came in at JPY 1,870M (+20.3% YoY) and operating income at JPY 101M (2.1x YoY), exceeding the revised guidance disclosed on 2/12 by +2.2% on revenue and +69.3% on operating income. Spot-type revenue accumulated beyond initial expectations in Q4, delivering JPY 41M of upside versus revised guidance. The launch of retail DX solutions for multiple major retailers drove top-line growth across both recurring and spot revenue streams, achieving robust growth while maintaining a recurring revenue ratio of 81.4%.
- Gross profit of JPY 1,048M (+17.2% YoY). GPM declined modestly to 56.1% (▲1.5pt YoY), but OPM improved to 5.4% (+2.3pt YoY)
- Eagle Eye installations reached 180 (+13.2% YoY). The wholesale distributor partner network is now complete with three partners — ITOCHU, Alfresa Healthcare, and Arata — and collaborative contract accumulation is ramping in earnest
- Operating CF of JPY 189M (vs. JPY 37M in the prior year), demonstrating a recovery in cash generation. FCF swung to a positive JPY 114M, with cash on hand rising to JPY 971M (+13.0% YoY)
- In the retail media space, purchase data linkages for advertising use were established in rapid succession with SMN, MBK Digital, and Hakuhodo DY ONE, laying the groundwork for monetization
- Obtained ISMS international certification, strengthening the security infrastructure essential for expanding business with major clients
Key Concerns From The Results
For FY03/2027, the company guides for revenue of JPY 2,200M (+17.6% YoY) with continued top-line growth, but operating income of JPY 80M (▲21.3% YoY) and GPM of 51.0% (▲5.1pt YoY), implying an earnings decline and margin compression. A deteriorating revenue mix from expanding collaborative contracts, cloud cost increases and yen depreciation, and front-loaded strategic investment expenses are all converging, ushering in a phase where the balance between top-line growth and profitability will be tested.
- Retail media and other recurring revenue at JPY 237M (▲13.5% YoY) declined. The pace of monetization for new data linkage deals remains an issue
- System-related costs surged to JPY 377M (+54.5% YoY). Incremental costs tied to the launch of large-scale projects compounded with FX headwinds, pushing the COGS ratio up to 43.9% (+1.5pt YoY)
- Accounts receivable ballooned to JPY 261M (+33.4% YoY), outpacing revenue growth. This is a seasonal factor driven by the concentration of spot-type revenue in Q4, but the collection cycle warrants monitoring
- Retained earnings carried forward remain negative at ▲JPY 419M. The mid-term plan states that shareholder returns will commence once retained earnings turn positive, but resolution will still require time
- An investment partnership operating loss of JPY 1M was recorded as a one-off loss related to CVC investments. Risk management as the CVC business scales is a point of debate
Focus Areas / Items To Monitor Going Forward
- FY03/2027 guidance calls for an operating loss in Q1 with the majority of operating income concentrated in Q4; the extent of the H1 deficit and the pace of recurring revenue accumulation will be critical to full-year achievability
- How far per-client revenue dilution progresses as Eagle Eye collaborative contracts expand. Tangible progress on the "upsell/cross-sell to raise customer ARPU" initiative outlined in the mid-term plan is key
- The timing and scale at which data linkages with Rakuten, Hakuhodo DY ONE, SMN, and MBK Digital in the retail media space begin to generate meaningful revenue will determine the probability of achieving the mid-term plan target (revenue exceeding JPY 3B in FY03/2029)
- Expected magnitude of the Q1 FY03/2027 operating loss and the tolerance guidelines for losses
- The gap in average revenue per client between collaborative and standalone contracts, and the track record of converting collaborative to standalone
- The share of collaborative contracts within the 180 Eagle Eye installations and the installation target for end of FY03/2027
- Drivers behind the decline in retail media and other revenue, and the outlook for a rebound in FY03/2027
- FX sensitivity of system-related costs and the policy for passing through cloud cost increases to customers
- Progress on the mid-term plan's M&A investment budget of over JPY 1B and priority areas
- Expected timing of collaboration synergies from the three CVC investments (ON&BOARD, ANOBAKA, Pegasus Tech Holdings)
- Specific timeline and KPI framework for the introduction of the in-house company system
- Expected timeline for resolving the negative retained earnings and commencing shareholder returns
- Remediation measures for the Q4-heavy concentration of spot-type revenue and the anticipated quarterly distribution for FY03/2027
Key Financial Highlights
| Item | Value | YoY |
|---|---|---|
| Revenue | JPY 1,870M | +20.3% |
| └ Recurring Revenue | JPY 1,523M | +6.8% |
| └ Spot Revenue | JPY 347M | +173.2% |
| Gross Profit | JPY 1,048M | +17.2% |
| Gross Profit Margin | 56.1% | ▲1.5pt |
| Operating Income | JPY 101M | +109.6% |
| Operating Income Margin | 5.4% | +2.3pt |
| Recurring Profit | JPY 108M | +121.6% |
| Net Income | JPY 80M | +508.5% |
| EPS | JPY 16.63 | +502.5% |
| EBITDA | JPY 167M | +76.1% |
| BPS | JPY 240.41 | +7.5% |
| ROE | 6.9% | +5.7pt |
| Eagle Eye Installations | 180 | +13.2% |
Against the revised guidance disclosed on 2/12 (revenue JPY 1,830M, operating income JPY 60M), spot-type deals accumulated beyond expectations in Q4, resulting in revenue beating by +2.2% and operating income by +69.3%. Net income of JPY 80M exceeded the revised guidance of JPY 45M by +77.5%.
Performance By Business Segment
| Segment | Revenue | YoY | Operating Income | YoY | Margin |
|---|---|---|---|---|---|
| Data Marketing (Consolidated) | JPY 1,870M | +20.3% | JPY 101M | +109.6% | 5.4% |
- Manufacturer Solutions (Recurring): JPY 952M (+8.0% YoY). Eagle Eye installations reached 180 (+13.2% YoY) as collaborative contracts via wholesale distributor partners continued to accumulate, sustaining steady growth
- Retail Solutions (Recurring): JPY 332M (+23.4% YoY). Multiple large-retailer engagements — including AI-powered promotional optimization and new store location prediction AI for Welcia — contributed for the full year, stabilizing at a high quarterly run-rate of JPY 103M in Q3–Q4
- Spot Revenue: JPY 347M (+173.2% YoY). Revenue was booked from multiple development projects as well as analytical report deliveries, with Q4 standalone reaching JPY 141M, a quarterly all-time high
- Retail Media & Other (Recurring): JPY 237M (▲13.5% YoY). Collaborations with new data linkage partners (SMN, MBK Digital, etc.) have commenced, but the revenue contribution remains limited
Progress Versus Full-Year Guidance
Against the revised guidance disclosed on 2/12 (revenue JPY 1,830M, operating income JPY 60M), spot-type revenue accumulated beyond expectations in Q4, resulting in achievement rates of 102.2% for revenue and 169.3% for operating income. Results fell short of the original plan (disclosed 2025/5/14) due to front-loaded spending on talent investment and AI solution development, but all profit line items exceeded revised guidance.
| Item | Value (Full-Year Actual) | Revised Guidance (2/12) | Achievement Rate |
|---|---|---|---|
| Revenue | JPY 1,870M | JPY 1,830M | 102.2% |
| Gross Profit | JPY 1,048M | JPY 1,013M | 103.5% |
| Operating Income | JPY 101M | JPY 60M | 169.3% |
| Net Income | JPY 80M | JPY 45M | 177.5% |
- New Manufacturer Solutions installations tend to ramp in April (start of the client fiscal year), aligned with client annual budgets
- Spot-type revenue tends to concentrate in Q2 and Q4, driven by delivery timing of major retail development projects
- FY03/2027 guidance assumes an extreme H2-weighted profile, with a Q1 operating loss and the majority of operating income booked in Q4
Guidance For The Coming Fiscal Year
FY03/2027 is positioned as the first year of the new mid-term management plan (FY03/2027–FY03/2029) and a period of intensified investment to build the foundation for medium-term earnings expansion. Revenue is projected to grow +17.6%, driven by the full-year contribution of major retail solutions and expanded Eagle Eye distribution via wholesale partners. On the other hand, operating income is guided lower due to GPM compression from a higher mix of collaborative contracts, cloud cost increases, higher personnel costs, and the inclusion of strategic investment expenses.
- Revenue: JPY 2,200M (+17.6%)
- Operating Income: JPY 80M (▲21.3%)
- Recurring Profit: JPY 78M (▲27.6%)
- Net Income: JPY 63M (▲21.4%)
- EPS: JPY 13.08 (▲21.3%)
Commentary On Shareholder Returns
No dividend for both FY03/2026 and FY03/2027. Retained earnings carried forward remain negative at ▲JPY 419M; the mid-term plan states the policy of "commencing shareholder returns once retained earnings turn positive."
Financial Position
The company achieved a net cash position (fully repaid long-term debt due within one year). While maintaining a high equity ratio of 75.9%, the company remains in a profit accumulation phase aimed at resolving the negative retained earnings of ▲JPY 419M.
- Key Figures
- Leverage Metrics
| Item | Value | Additional Information |
|---|---|---|
| Cash and Cash Equivalents | JPY 971M | +13.0% YoY |
| Total Assets | JPY 1,534M | +12.6% YoY |
| └ Total Current Assets | JPY 1,315M | +15.1% YoY |
| └ Total Non-Current Assets | JPY 218M | ▲0.7% YoY |
| Shareholders' Equity | JPY 1,163M | +7.7% YoY |
| └ Retained Earnings Carried Forward | ▲JPY 419M | Improved from ▲JPY 499M in prior year |
| Interest-Bearing Debt | JPY 0M | Fully repaid from JPY 5M in prior year |
| Accounts Receivable | JPY 261M | +33.4% YoY |
| Investment Capital | JPY 55M | +122.5% YoY, CVC investments |
| EBITDA | JPY 167M | Operating income 101 + D&A 65 |
News Released Alongside The Earnings Announcement
- 2026/05/15Variance between FY03/2026 full-year guidance (announced 2/12) and actual results. Spot-type order intake and revenue recognition in Q4 exceeded initial expectations, with revenue and all profit line items surpassing revised guidance Notice Regarding Variance Between Guidance and Actual Results
Major Announcements During The Quarter
- 2026/03/27Published a case study of Daiichi Sankyo Healthcare utilizing Eagle Eye as internal infrastructure. Accounts were extended beyond the research department to individual brand managers, advancing company-wide data utilization Daiichi Sankyo Healthcare Adopts ID-POS as Internal Infrastructure! Brand Managers Now Using the Tool Alongside the Research Division
- 2026/04/17Published a case study of Zenyaku Kogyo's Eagle Eye utilization. Leveraging purchase data analysis, the company revised product messaging for the cold medicine "Jikinin First Neo," resulting in sales tripling the following fiscal year Purchase Data Utilization Contributes to Tripling Sales of "Jikinin" Cold Medicine New Product
- 2026/04/23Jointly with Sony Group's SMN, verified the offline purchase impact of a major beverage manufacturer's TV CM × digital advertising. The purchase rate among the overlapping TV CM + digital ad exposure group was +41% versus the non-exposure group, demonstrating the effectiveness of the retail media domain True Data and SMN, Which Integrates Purchase Data for Advertising Solutions, Jointly Visualize Offline Purchase Impact of Major Beverage Manufacturer's Advertising
Large-Shareholding Filings / Material Proposals Over The Past Year
None
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