NOVA SYSTEM CO.,LTD.
5257・Standard Market・Information & Communication
Business
NOVA SYSTEM CO.,LTD. is an independent software development company established in 1982. Its business consists of a single segment, the Software Development Business, offering two services: "System Integration (SI)" and "Cloud Services". SI accounts for 98.4% of net sales, with a primary focus on the financial industry, including life insurance, non-life insurance, banks, and trust banks. SI for the insurance industry is a key area, accounting for 49.0% of SI net sales in FY2025 (ending December 2025). The company is based in Osaka and Tokyo, with additional offices in Hiroshima and Kokura, and listed on the TSE Standard Market in March 2023. In June 2025, it made VIET NHAT SOFTWARE JOINT STOCK COMPANY of Vietnam a subsidiary.
Business Model
Over 90% of net sales derive from SI contract development under agreements with prime contractor SIers and user-affiliated SIers. The company accumulates industry-specific "business knowledge" through the cumulative track record of system development, creating a cyclical model that leads to recurring orders for maintenance, renewals, and similar work. It operates a labor-intensive structure in which revenue is recognized in proportion to the utilization of engineers, and it responds to demand fluctuations through a collaborative framework with partner companies. Cloud Services (Order Revolution, etc.) is offered as a SaaS-type subscription, building recurring revenue through monthly usage fees.
Company Strengths
The company began SI operations for the life insurance industry in 1985 and has over 40 years of development track record. It handles individual insurance product systems, corporate pension systems, core banking systems, and more, with a track record of transactions with multiple insurance companies, led by Nissay Information Technology Co., Ltd. The insurance industry's share of SI sales reached 49.0% in FY2025 (ending December 2025).
In FY2025 (ending December 2025), the major customers were IBM Japan, Ltd. (29.7% of net sales), Nissay Information Technology Co., Ltd. (18.1%), and SCSK Corporation (14.7%), together accounting for 62.5%. Continuous partnerships with major SIers form a stable order-receiving base.
Through the promotion of sales measures for Cloud Services such as "Order Revolution," the company achieved Cloud Services sales of ¥108,699 thousand (up 18.6% year on year) in FY2025 (ending December 2025). In addition, orders received increased to ¥6,794,951 thousand (up 5.6% year on year), and the order backlog, which forms the sales base for subsequent periods, stands at ¥1,196,577 thousand.
ENVALITH's Perspective
Performance Trend
Revenue continued its growth trend, rising from ¥4,626 million in FY2022 to ¥5,423 million in FY2023, ¥6,462 million in FY2024, and ¥6,716 million in FY2025. On the other hand, operating profit peaked at ¥528 million in FY2024 before falling sharply to ¥325 million in FY2025 due to the impact of unprofitable projects. In Q1 FY2026, revenue was ¥1,718 million (up 2.4% year-on-year), operating profit was ¥121 million (up 26.6% year-on-year), and the gross profit margin was 21.8% (versus 19.2% in the same period of the previous year), indicating a clear recovery in profitability. As an external factor, software investment across all industries is expected to increase 4.4% versus FY2025, with resilient IT investment demand providing a tailwind. The full-year forecast calls for ambitious targets of ¥7,535 million in revenue (up 12.2% year-on-year) and ¥617 million in operating profit (up 90.3% year-on-year), making progress from Q2 onward the key focus.
Growth Strategy
Expanding the business domain along three axes: deepening business knowledge, AI proposal-driven activities, and expanding Cloud Services
Building on continued orders driven by deepening relationships with existing customers, the company is expanding into new development areas for insurance and banking through AI technology utilization and proposal-driven activities. SI sales in 1Q FY2026 (ending March 2026) grew steadily, up 2.5% year on year, with orders and development progressing as planned at the start of the fiscal year.
The company is promoting sales measures for its proprietary Cloud Services, aiming to build up recurring revenue by increasing the number of stores adopting the service. Cloud Services sales in 1Q FY2026 (ending March 2026) came to ¥31 million, a slight decline of 1.9% year on year, indicating that further strengthening of measures is still needed to accelerate growth.
The Yodoyabashi office was opened in 1Q FY2026 (ending March 2026) to strengthen mid-career recruitment and expand the sales activity base. SG&A expenses increased 12.2% year on year due to opening costs and higher recruitment expenses, reflecting an upfront investment phase. This is expected to strengthen order-taking capacity and human resource infrastructure over the medium to long term.
Reflecting on how unprofitable projects significantly weighed on profits in FY2025, the Project Risk Management Group has become fully operational. In 1Q FY2026 (ending March 2026), cost of sales decreased year on year and gross margin improved, with the effects of the strengthened management framework beginning to show in the numbers.
Last updated: July 17, 2026