AI inside Inc.

Business Details

AI inside Inc. holds the purpose of "Contributing to the evolution of humanity and the happiness of people through AI," and develops the AI-agent-equipped AI-OCR solution "DX Suite" as its core offering, alongside the multimodal AI integration platform "AnyData" and the education program "AI Growth Program." Revenue consists of recurring-type (monthly usage-based/fixed) and selling-type (initial fees, etc.) revenue, with recurring-type accounting for approximately 94.5% of sales. The company operates in the Artificial Intelligence Business, a single segment.

Recent Overview

Revenue and ordinary income increased, but operating income declined year-on-year due to higher SG&A expenses

In FY2026 (ending March 2026), the company achieved revenue growth to ¥4,747 million (+7.9% year-on-year). The number of DX Suite licenses increased to 3,203 (versus 3,057 in the prior period), and recurring-type revenue was solid at ¥4,487 million (+7.1% year-on-year). On the other hand, SG&A expenses expanded to ¥3,587 million (+12.4% year-on-year) due to increases in personnel expenses, R&D expenses, new office rent, advertising expenses, and other costs, causing operating income to decline to ¥310 million (-19.2% year-on-year). With the recognition of ¥185 million in subsidy income, ordinary income increased to ¥487 million (+20.1% year-on-year). As the ¥685 million impairment loss recorded in the prior period no longer applied, net income turned positive at ¥351 million. Cash and cash equivalents decreased to ¥3,566 million due to a ¥2,100 million time deposit placement associated with the head office relocation, among other factors. The company repaid ¥600 million of short-term borrowings, leaving a balance of ¥1,000 million. For FY2027 (ending March 2027), the company forecasts revenue of ¥5,230 million and operating income of ¥523 million, driven by the evolution of DX Suite and the full-scale launch of the Leapnet business.

Key Products

Growth Drivers

• Continued growth in DX Suite license count (3,203) and accumulation of recurring-type revenue supported by a low churn rate
• Evolution of DX Suite into an AI agent execution platform and acquisition of new customers/expansion of usage among existing customers through promotion of PolySphere's high reading accuracy
• Full-scale launch of the Leapnet business and establishment of a new revenue source through AI agent development and sales via alliance partner collaboration
• Continued revenue diversification through ongoing contributions from AnyData and AI Growth Program
• Expansion of corporate DX demand and growth of the outsourcing market against the backdrop of the declining birthrate, aging population, and shrinking working-age population
• Expansion of contract numbers through strengthening of partner sales channels

Risks

• Downward pressure on operating margin due to increases in SG&A expenses (personnel expenses, R&D expenses, new office rent, advertising expenses, web service usage fees, etc.) (operating margin declined to 6.5% in FY2026 (ending March 2026))
• Interest expense risk from the remaining ¥1,000 million short-term borrowings (¥17 million in interest expense recognized)
• Significant decrease in cash and cash equivalents (¥3,566 million) due to a ¥2,100 million time deposit placement, among other factors, and related liquidity management considerations
• Increased upfront investment costs associated with the launch of the Leapnet business and uncertainty regarding the timing of monetization
• Volatility in selling-type revenue (a significant decline of -39.0% year-on-year was recorded previously; the current period showed recovery but remains small in scale)
• Intensifying competition in the AI-OCR market and increased costs to respond to technological innovation
• Uncertainty regarding the continuity of subsidy income (¥185 million), which makes a significant contribution to ordinary income