sinops Inc.
4428・Growth Market・Information & Communication
sinops Business (Single Segment)
A single-business company providing AI-based demand forecasting and automated ordering services for the distribution industry
| Period | Current | Previous | Change |
|---|---|---|---|
| Revenue (cumulative first quarter) | ¥483 million | ¥454 million | ↑ |
| Operating profit (cumulative first quarter) | ¥26 million | ¥43 million | ↓ |
| Operating margin (cumulative first quarter) | 5.5% | 9.6% | ↓ |
| Ordinary profit (cumulative first quarter) | ¥42 million | ¥44 million | ↓ |
| Net income (cumulative first quarter) | ¥29 million | ¥31 million | ↓ |
| ARR (Annual Recurring Revenue) | ¥1,593 million | ¥1,385 million (estimated for the same period last year) | ↑ |
| Number of paid cloud service stores | 3,317 stores | 3,215 stores (same period last year) | ↑ |
| Number of paid cloud service accounts | 13,496 accounts | 12,413 accounts (same period last year) | ↑ |
| Number of contracted companies | 121 companies | 120 companies (same period last year) | ↑ |
| Food supermarket share | 37.2% | 36.7% | ↑ |
| Overall retail industry share | 19.1% | 18.9% | ↑ |
| Total assets | ¥2,223 million | ¥2,438 million | ↓ |
| Equity ratio | 84.0% | 77.9% | ↑ |
Business Details
Deploys the "sinops series" of AI services for the distribution industry, covering the three layers of retail, wholesale, and manufacturing, with demand forecasting and automated ordering at its core. Comprised of four services: cloud service (sinops-CLOUD), package sales, implementation support, and support. Maintains a 37.2% share among food supermarkets, capturing IT investment demand driven by labor shortages and logistics challenges. ARR stood at ¥1,593 million (up 15.0% year on year).
Recent Overview
Cloud and support services performed well, but operating profit fell 39.4% year on year due to higher cost of sales and outsourcing expenses
In the first quarter of FY2026 (ending December 2026), revenue increased to ¥483 million (up 6.5% year on year), but cost of sales rose 15.6% year on year due to increased manufacturing personnel and communication costs associated with cloud service expansion, causing gross profit to decline 6.1%. In addition, SG&A expenses rose 3.8% due to increased outsourcing costs from greater use of partner companies, resulting in operating profit falling to ¥26 million (down 39.4% year on year). On the other hand, the recording of ¥10 million in subsidy income and ¥5 million in foreign exchange gains limited the decline in ordinary profit to ¥42 million (down 5.7% year on year), with limited impact on net income. The full-year earnings forecast (revenue of ¥2,344 million, operating profit of ¥390 million) remains unchanged, and the decline in first-quarter profit is regarded as being within the scope of the plan.
Key Products
Growth Drivers
- Expansion of cloud revenue through progress in upsell and cross-sell to existing users (up 21.9% year on year in the first quarter)
- Expansion of the recurring revenue base through continued ARR growth (¥1,593 million, up 15.0% year on year)
- Increased IT investment by retailers amid the logistics industry's "2024 problem" and social demand for food waste reduction
- Steady market penetration through expansion of food supermarket share to 37.2% and overall retail share to 19.1%
- Revenue expansion of DeCM-PF (leveraging the Ministry of Economy, Trade and Industry's subsidy program "Demonstration Project for Logistics Efficiency Supporting Sustainable Logistics")
- Cultivation of a medium- to long-term revenue pillar through promotion of proposals and pilot trials for sinops-WLMS with existing and new users
- Low risk of SaaS substitution by generative AI (service characteristics closely tied to human operations and decision-making)
Risks
- Rising cost of sales due to increased manufacturing personnel and communication costs associated with cloud service expansion (up 15.6% year on year in the first quarter), leading to a decline in gross margin
- Increased outsourcing costs from greater use of partner companies pushed up SG&A expenses, causing a significant decline in operating margin from 9.6% to 5.5%
- Implementation support revenue was weak, down 19.1% year on year, with timing shifts in new implementations posing a risk factor for revenue volatility
- DeCM-PF and sinops-WLMS require continued investment over several years, with limited short-term revenue contribution
- With food supermarket share reaching a high level of 37.2%, growth potential in the core market is diminishing
- An uncertain business environment ahead, including continued price increases, geopolitical risk, and unstable exchange rates
- Risk of rising cost ratio and SG&A ratio due to increasing labor costs (wage increase pressures)
Last updated: March 26, 2026