Serverworks Co.,Ltd.

Business Details

A cloud-specialist business providing end-to-end resale, integration, and managed services for AWS and Google Cloud. AWS Resale (stock-type) accounts for approximately 90% of revenue, with Cloud Integration (flow-type) and MSP (stock-type) complementing earnings. The domestic cloud market continues to grow rapidly, driven by DX promotion and the spread of generative AI, with the strategic collaboration agreement with AWS (signed in 2023) positioned as a core strategy. In the first quarter of FY2027 (ending February 2027), revenue reached ¥11,933 million (up 29.4% year on year), continuing high growth.

Recent Overview

Q1 of FY2027 (ending February 2027) saw revenue up 29.4% and operating profit up 99.6%, marking substantial growth in both revenue and profit

In the first quarter of FY2027 (ending February 2027) (March to May 2026), revenue reached ¥11,933 million (up 29.4% year on year) and operating profit reached ¥398 million (up 99.6% year on year), achieving high growth. Resale (revenue of ¥10,754 million, up 29.9% year on year) led the growth, while Cloud Integration (¥686 million, up 30.5% year on year) and MSP (¥484 million, up 17.2% year on year) also remained solid. The company completed acquisition of AWS AI Competency certification and concluded a reseller agreement with Anthropic, establishing a framework for AI-related infrastructure construction and operation. Ragate Corporation was newly added as an equity-method affiliate. The full-year earnings forecast remains unchanged.

Key Products

Growth Drivers

• Rapid expansion of cloud demand driven by DX promotion and the spread of generative AI (AWS's large-scale investment plans in domestic cloud infrastructure in Japan)
• Acceleration of enterprise and SMB project acquisition through the four-year strategic collaboration agreement with AWS (signed in 2023)
• Expansion of stock-type resale revenue through increased AWS usage fees among existing customers (rising ARPU) and new account acquisition
• Capture of AI-related infrastructure construction and operation projects through acquisition of AWS AI Competency certification and conclusion of a reseller agreement with Anthropic
• Strengthened multi-cloud capabilities through collaboration with the Google Cloud business (subsidiary G-gen)
• The high-margin characteristics of the MSP business and structural expansion of operational outsourcing demand
• Increasing system complexity from generative AI and IoT adoption boosting demand for Cloud Integration and MSP

Risks

• Risk of order losses associated with an increase in large-scale, highly complex Cloud Integration projects (a provision for order losses of ¥220 million was recorded in FY2026 ending February 2026)
• Risk of dependence on AWS due to revenue concentration in AWS Resale (approximately 90% of revenue) and exposure to AWS pricing and policy changes
• Rising labor costs and growth constraints due to a shortage of cloud specialist engineers and intensifying hiring competition
• Pressure on profitability from increased strategic discounting associated with larger project sizes
• Risk of rising AWS procurement costs due to unstable foreign exchange fluctuations (a foreign exchange loss of ¥10 million was recorded in non-operating expenses)
• Increasing security risks and rising costs for data protection measures
• Risk of economic downturn due to geopolitical risks, including the situation in the Middle East, and trends in rising long-term interest rates and financial and capital markets