Summary
The company has maintained its full-year guidance of JPY 1,466M in revenue and a JPY 30M operating loss. Both revenue and profit are heavily weighted toward 2H, so 3Q results will be the first real test of whether the plan is achievable. Disease Solutions drove 1H revenue growth, and the key question is whether pharma-related projects keep expanding. Welby My Karte revenue fell in 1H because some projects slipped into later periods. We want to see when the larger platform-provision projects will be recognized as revenue. We will also check whether the rise in work-in-process and contract liabilities at end-1H converts into 2H revenue. On the balance sheet, the company completed a JPY 50M third-party allotment with a September 30 payment date. In October, it also approved a third-party allotment by consolidated subsidiary WHS, with TISI as the allottee, further strengthening consolidated capital. 3Q results will show how quickly the operating loss is narrowing and what effect these capital measures are having.
Key Points for Next Quarter
| Key Points & Focus | Implications |
|---|---|
Full-Year Guidance Progress9M cumulative revenue vs. full-year guidance; YoY change in standalone 3Q revenue | 1H progress was 25.6% (our estimate), leaving JPY 1,090M to be booked in 2H (our estimate). Growth over the prior-year standalone 3Q figure of JPY 92M is the first gauge of whether the plan is achievable. |
Disease SolutionsYoY change in Disease Solutions Service revenue; build-up of platform operation projects | 1H revenue reached JPY 244M (+81.2%), driving overall growth. The focus is whether new PHR projects from pharma companies and oncology demand persist into 3Q. |
Welby My KarteRecovery in Welby My Karte Service revenue; booking of delayed projects | 1H revenue was JPY 132M (-13.7%), hit by some projects slipping into later periods. We will track the timing of large-project bookings alongside work-in-process of JPY 56M and contract liabilities of JPY 93M. |
ProfitabilityYoY trend in operating loss; Gross Profit Margin; SG&A growth | Meeting the full-year operating loss target of JPY 30M requires JPY 226M of operating income in 2H (our estimate). We will check how far the loss narrows from the prior-year standalone 3Q operating loss of JPY 172M (our estimate). |
Financial PositionEnd-3Q net assets, Equity Ratio, cash and deposits; impact of capital measures | At end-1H, the Equity Ratio was 6.7% and cash and deposits stood at JPY 435M. The JPY 50M third-party allotment, with a September 30 payment date, will be reflected at end-3Q. We will also track conversion of the convertible bonds (CB) and the consolidated capital boost from the WHS third-party allotment to TISI approved in October. |
Key Issues from Previous Results (FY12/2026 2Q Results)
1H revenue rose 30.7% to JPY 376M. However, the operating loss of JPY 256M was roughly flat with the prior-year JPY 249M loss. Full-year guidance is unchanged from the February 24, 2026 announcement, with revenue and profit concentrated in 2H. 3Q results will test both growth momentum and the sustainability of the balance sheet.
1. Progress Against 2H-Weighted Full-Year Guidance
- Previous Quarter: 1H revenue of JPY 376M represents 25.6% of the JPY 1,466M full-year target (our estimate). Standalone 2Q revenue was JPY 243M, up from JPY 167M a year earlier (our estimate).
- What to Watch This Quarter: Last year, revenue was skewed toward 4Q, at JPY 92M in standalone 3Q and JPY 255M in standalone 4Q. The 2H target of JPY 1,090M is about 3.1x prior-year 2H revenue of JPY 348M (our estimate). We want to see how much project volume has built up by 3Q.
- Key Metrics: 9M cumulative revenue vs. full-year guidance (prior-year 9M: JPY 380M); YoY change in standalone 3Q revenue; any revision to full-year guidance.
2. Sustainability of Disease Solutions Growth
- Previous Quarter: Revenue rose 81.2% to JPY 244M, driven by new PHR services ordered by pharma companies. Its share of total revenue rose to 64.9% from 46.8% a year earlier (our estimate).
- What to Watch This Quarter: Management says the PHR platform is now running across multiple projects and generating stable monthly revenue. The focus is whether the PHR platform contributes to 3Q revenue.
- Key Metrics: YoY change in Disease Solutions Service revenue; trend in revenue mix; PHR platform order progress.
3. Booking of Delayed Welby My Karte Projects
- Previous Quarter: Revenue fell 13.7% to JPY 132M, partly because some projects slipped into later periods. As of end-June 2026, users had registered 33,927 primary-care medical institutions, and cumulative app downloads reached about 1.25 million.
- What to Watch This Quarter: In platform provision, larger project sizes have lengthened order lead times. The focus is whether delayed projects are booked in 3Q. Work-in-process rose from JPY 3M at the prior fiscal year-end to JPY 56M, and contract liabilities rose from JPY 56M to JPY 93M. We will check whether these increases translate into 2H revenue.
- Key Metrics: YoY change in Welby My Karte Service revenue; registered primary-care medical institutions (33,927 at end-June); work-in-process and contract liability balances.
4. Balancing Upfront Investment and Narrowing Operating Losses
- Previous Quarter: Gross Profit rose 27.8% to JPY 255M, with a Gross Profit Margin of 68.0% (69.5% a year earlier; our estimate). SG&A rose 13.9% to JPY 512M on hiring and development spending, including JPY 98M of upfront investment.
- What to Watch This Quarter: Management says platform development spending is lifting the Gross Profit Margin of related products. The plan assumes JPY 226M of operating income in 2H (our estimate). How far the loss narrows from the prior-year standalone 3Q operating loss of JPY 172M (our estimate) will show how the plan is tracking. The 1H net loss was smaller than the recurring loss thanks to an JPY 18M gain on reversal of stock acquisition rights and a JPY 14M interim net loss attributable to non-controlling interests. We will again check the breakdown of extraordinary items and non-controlling interests in 3Q.
- Key Metrics: 9M cumulative operating loss (prior-year 9M: JPY -421M); YoY change in Gross Profit Margin; YoY change in SG&A.
5. Financial Position and Progress on Capital Measures
- Previous Quarter: Cash and deposits were JPY 435M, down JPY 275M from the prior fiscal year-end. Net assets were JPY 108M and shareholders' equity JPY 56M, for an Equity Ratio of 6.7% (20.9% at the prior fiscal year-end). Interest-bearing debt consisted of JPY 200M in short-term borrowings, plus JPY 317M in CBs.
- What to Watch This Quarter: The JPY 50M third-party allotment approved on September 15 had a September 30 payment date. Its effect on equity will be visible in the end-3Q balance sheet. We will also monitor CB conversions. TISI's alliance, announced October 20, includes a third-party allotment by WHS (Welby Healthcare Solutions). WHS is expected to remain a consolidated subsidiary after the capital increase, which will boost consolidated net assets. As this is a subsequent event after end-3Q, we will check the disclosure in 3Q results and its reflection in full-year results.
- Key Metrics: End-3Q net assets and Equity Ratio; cash and deposits; CB balance; payment status of the WHS third-party allotment.
Key Timely Disclosures This Period
- 2026/10/20Business Alliance with TISI and Third-Party Allotment by WHS - TISI will subscribe to a third-party allotment by WHS, making WHS an equity-method affiliate of TISI. The two will pursue joint sales to local governments, medical institutions, and insurers. WHS is expected to remain a consolidated subsidiary after the capital increase. The company expects a minor impact on FY12/2026 consolidated earnings, but the deal will increase consolidated net assets. As a subsequent event after end-3Q, its impact on the capital structure will be confirmed in full-year results.
- 2026/09/15Issuance of New Shares via Third-Party Allotment - 100,000 common shares were allotted to Representative Director and largest shareholder Takeshi Hiki, raising JPY 50M. The proceeds will fund PHR platform development from September to December 2026, supporting a shift toward recurring revenue built on annual usage fees. The measure strengthens equity, and with a September 30, 2026 payment date, it will be reflected in the end-3Q balance sheet.
- 2026/08/282Q Earnings Presentation (Business Plan and Growth Potential) - This document sets out the assumptions behind the 2H-weighted full-year plan and the growth strategy. It serves as a benchmark for assessing progress in 3Q results.
Previous Quarter Results (FY12/2026 2Q Actual)
The company operates a single segment, the PHR Platform Service business, through two services. Disease Solutions Service provides pharma companies with PSPs (patient support programs) and ePRO (electronic patient-reported outcomes) data collection. Welby My Karte Service provides a platform to medical institutions, insurers, and corporates. Through alliances with Chubu Electric Power, Suzuken, Nippon Life, TISI, and others, the company aims to extend PHR into regional healthcare and insurer markets. In 1H, Disease Solutions growth lifted revenue 30.7%. However, higher SG&A from development spending and hiring left the operating loss roughly flat YoY.
| Item | Amount | YoY | vs. Company Plan | Notes |
|---|---|---|---|---|
| Revenue | JPY 376M | +30.7% | - | Disease Solutions +81.2%, My Karte -13.7%. Progress vs. full-year guidance: 25.6% (our estimate) |
| Operating Income | JPY -256M | - | - | Prior year: JPY -249M. SG&A +13.9%; upfront investment of JPY 98M |
| Recurring Profit | JPY -257M | - | - | Prior year: JPY -250M |
| Interim Net Income Attributable to Owners of Parent Company | JPY -223M | - | - | Includes JPY 18M extraordinary gain on reversal of stock acquisition rights |
| EPS | JPY -26.70 | - | - | Prior year: JPY -29.44 |
Progress vs. Full-Year Guidance (Operating Income Basis): Not calculated. Both the full-year guidance (JPY 30M operating loss) and the 1H result (JPY 256M operating loss) are losses, so no progress rate is calculated. The company has not disclosed Recurring Profit guidance. For reference, revenue progress vs. full-year guidance was 25.6% (our estimate).
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