ENVALITH
株式会社EduLab logo

EduLab, Inc.

4427・Growth Market・Information & Communication

Official website
株式会社EduLab logo
EduLab, Inc.4427

Business

EduLab, Inc. is a holding company (12 consolidated subsidiaries) that has conducted research and development in human ability measurement technology for over 20 years. It operates five businesses: licensing of the English proficiency assessment test "CASEC" and the children's test "EIKEN Jr."; AI solutions such as the AI-OCR "DEEP READ," AI automated scoring "DEEP GRADE," and English writing learning tool "UGUIS.AI"; outsourced academic testing for the Ministry of Education, Culture, Sports, Science and Technology (MEXT) and local governments; and operation of approximately 40 CBT test centers across 28 prefectures nationwide. Major customers are the public interest incorporated foundation Eiken Foundation of Japan (34.0% of net sales), MEXT (9.7%), and various local government and other public-sector organizations. Listed on the Tokyo Stock Exchange Growth Market.

Business Model

The company's revenue pillars consist of three businesses: Test Center Business (approximately 53% of net sales), Test Administration & Outsourcing Business (approximately 24%), and Test & License Business (approximately 11%). The Test Center Business generates volume-based revenue linked to the number of CBT test-takers, the Outsourcing Business is order-based through public tenders, and the License Business operates on a subscription/license model. The AI Business is expanding through license revenue from DEEP READ and the monetization of the new service UGUIS.AI. Through a capital and business alliance with the Zoshinkai Group (Z-kai), the company is pursuing synergies in both sales and operations.

Company Strengths

Since launching CASEC in 2001, the company has accumulated over 20 years of proprietary test technology combining IRT (Item Response Theory) and CAT (Computer Adaptive Testing). EIKEN Jr. has been offered since 1994 and has become widely adopted by schools and cram schools as an English test for preschoolers through elementary school students. This technological foundation serves as the source of differentiation versus other businesses (CBT and AI grading).

The CBT Test Center business, launched in 2020, has expanded to approximately 40 locations across 28 prefectures nationwide. In FY2025 (ending September 2025), it achieved net sales of ¥3,283 million and segment profit of ¥396 million (profit margin of 12.1%), representing a 28.5% year-on-year increase in profit. Strengthened operations through EdTech RISE, a joint venture with Z-Kai, allow the business to directly capture the market trend toward CBT adoption, functioning as social infrastructure.

The company has been awarded multiple large-scale public projects, including the Ministry of Education, Culture, Sports, Science and Technology's "National Assessment of Academic Ability," the Japan Sports Agency's "National Survey on Physical Fitness, Athletic Ability, and Exercise Habits," and the National Institute for Educational Policy Research's "OECD-PISA 2025 Main Survey Support Services." In FY2025 (ending September 2025), the order backlog for the Test Administration & Outsourcing Business stood at ¥375 million (up 112.0% year on year), confirming an accumulation of revenue for the next period.

ENVALITH's Perspective

In the first half of FY2026 (ending March 2026), net sales were ¥2,893 million (down 2.0% year on year) and operating profit was ¥154 million (down 10.0%), resulting in lower sales and profit. The disappearance of the ¥97 million foreign exchange gain recorded in the same period of the previous year, along with ¥58 million in special retirement benefits paid by the US subsidiary, weighed on results, and net loss attributable to owners of the parent for the interim period was ¥36 million (versus net income of ¥179 million in the same period of the previous year). The company describes the results as "generally solid and in line with plan," and has not revised its full-year forecast (net sales of ¥5,800 million, operating profit of ¥80 million, and net income of ¥10 million), though a recovery in the second half is necessary.

The Test Center Business maintained high growth, with net sales up 17.4% year on year and segment profit up 97.0%, functioning as the core growth engine and accounting for 59% of total company sales. Meanwhile, the Test Administration & Outsourcing Business suffered a sharp deterioration due to the drop-off of a single-year project recorded in the previous fiscal year, with net sales down 33.8% year on year to ¥517 million and segment profit down 57.2%. The structural risk stemming from the single-year nature of public-sector projects and dependence on bidding has become apparent, and the trend in acquiring new projects will be key to full-year performance.

The AI Business maintained growth with net sales of ¥112 million (up 5.7% year on year), but upfront running costs for a new service expected to be recorded in the second half caused the segment to fall into a segment loss of ¥15 million (versus segment profit of ¥37 million in the same period of the previous year). Whether UGUIS.AI's expanded functionality and the new service "EIKEN® Grade Simple Assessment" achieve monetization in the second half will be an important point of evaluation for achieving the full-year net income forecast of ¥10 million. The stabilization of foreign exchange gains/losses resulting from the reorganization of overseas subsidiaries (completion of liquidation in Singapore and implementation of debt-equity swap) can be viewed as a structural improvement.

Growth Strategy

Aiming to maintain profitability across all profit categories in the final year of the medium-term management plan through three pillars: accelerating CBT adoption, expanding the AI Business, and completing the rationalization of overseas affiliates

The company aims to achieve continued growth in the number of users at approximately 40 CBT test centers nationwide. It continues to optimize its operational structure through EdTech RISE with the Zoshinkai Group, achieving a segment profit margin of 10.3% (an improvement of approximately 4.2 percentage points year on year) in the first half of FY2026 (ending September 2026). The company aims to maximize the benefits of the accelerating CBT market environment.

The company is promoting the addition of speaking practice and learning diagnostic functions to UGUIS.AI (October to December 2025) and the expansion of sales of "EIKEN® Grade Simple Assessment powered by CASEC" (launched January 2026) from the second half onward. The goal is to absorb upfront running costs and eliminate the AI Business segment loss (¥15 million in the first half) for the full fiscal year.

In October 2025, Edutech Lab, Inc. absorbed and merged with DoubleYard, Inc., converting foreign currency-denominated loans into equity through a debt-equity swap. In February 2026, the liquidation of the Singapore subsidiary was completed, finalizing the reorganization of overseas affiliates in China, Hong Kong, and Singapore. This has significantly reduced foreign exchange valuation gains and losses arising from foreign currency-denominated receivables, improving the stability of business performance.

Due to the falloff of single-year projects from the previous consolidated fiscal year, first-half revenue declined significantly, down 33.8% year on year. While continuing to select projects with an emphasis on profitability, the company is promoting the acquisition of new large-scale public sector projects from entities such as the Ministry of Education, Culture, Sports, Science and Technology and the Japan Sports Agency. It aims to maintain profit margins by improving its cost structure through reducing outsourcing expenses and bringing operations in-house.

Last updated: July 17, 2026