NITTOKU CO., LTD.

Business Details

A 'Line Builder' business that provides production systems capable of high-function multi-axis synchronous control via proprietary OS, based on technology that incorporates winding, handling, assembly, inspection, and other processes onto a conveyance system. The business manufactures, sells, and maintains Coil Winding Machines & Winding Systems, peripheral equipment, and assembly lines for a wide range of industries including electronic components, automobiles, communication devices, and precision instruments. It is also expanding into mechatronics areas that do not include winding processes, such as high-speed inspection handlers for the semiconductor industry, winding machines for the energy device industry, and Motor Manufacturing Equipment for AI Servers.

Recent Overview

Both revenue and profit reached record highs, driven by a sharp expansion in sales to the U.S. and a decline in the proportion of projects involving new development elements

In the full fiscal year ended March 2026, overseas sales to the U.S. and other regions were robust, and the proportion of projects involving new development elements decreased compared to the previous fiscal year, while efforts to pass on price increases and reduce costs proved effective. By region, sales to the U.S. surged approximately 4.3-fold to ¥11,756 million (from ¥2,709 million in the prior fiscal year), and export sales of individual products also increased significantly to ¥16,586 million (from ¥7,674 million in the prior fiscal year). Meanwhile, sales to Europe roughly halved to ¥2,894 million (from ¥5,711 million in the prior fiscal year), and the European subsidiary NITTOKU EUROPE GmbH. underwent an impairment test (no impairment loss was recognized). As a subsequent event, in April 2026 NITTOKU KYOTO Co., Ltd. acquired the laser processing systems business of Kataoka Corporation through a company split absorption (acquisition cost of ¥1,200 million, plus a loan of ¥800 million), aiming to create new revenue opportunities in laser-related businesses. In addition, AXON ENTERPRISE, INC. was disclosed for the first time as a major customer, with sales of ¥10,388 million.

Key Products

Growth Drivers

• Rapid expansion of sales to the U.S. (FY2026: ¥11,756 million, approximately 4.3 times the prior fiscal year's ¥2,709 million), driven by major customer projects such as AXON ENTERPRISE, INC.
• Increased capital expenditure demand driven by AI and digital-related investment as well as automotive electrification and safety enhancement
• Expanding orders for stepping motor, fan motor, and pump motor manufacturing equipment for power-saving and high-efficiency cooling in the AI server market
• Expansion of the strategic product lineup, including high-speed inspection handlers for the semiconductor industry, winding machines for the energy device industry, and roll-to-roll equipment for perovskite solar cells
• Development of new equipment for small precision motors (coreless motors and brushless DC motors) for humanoid robot joints and fingertips
• Creation of new revenue opportunities in laser-related businesses through NITTOKU KYOTO Co., Ltd.'s acquisition of the laser processing systems business (via company split from Kataoka Corporation)
• Expansion into emerging markets through the Indian joint venture NITTOKU FA INDIA PVT. LTD. (jointly funded with Daiichi Jitsugyo Co., Ltd.)
• Securing immediately productive talent through a 'satellite strategy' and business expansion through an 'M&A strategy'
• Improved profitability through a decline in the proportion of projects involving new development elements, along with price pass-through and cost reduction

Risks

• Risk of extended delivery times and additional costs on projects involving new development elements (multiple such cases occurred in FY2025, ending March 2025, the main cause of the significant profit decline in the prior fiscal year)
• Risk of deteriorating performance at the European subsidiary NITTOKU EUROPE GmbH. due to the economic slowdown in the European mobility industry (indications of impairment exist; an impairment test has been conducted)
• Impact on global trade and capital expenditure demand from changes in trade policy in various countries, including U.S. tariff measures
• Risk of sales concentration in a specific customer (AXON ENTERPRISE, INC.: sales of ¥10,388 million, approximately 25.6% of segment revenue)
• Revenue recognition risk for projects applying the percentage-of-completion method, associated with the trend toward larger-scale, longer-lead-time production equipment
• Integration and business development risk related to NITTOKU KYOTO Co., Ltd. (the laser processing systems business from Kataoka Corporation) (acquisition cost of ¥1,200 million plus a loan of ¥800 million)
• Litigation risk including arbitration-related costs (extraordinary loss of ¥565 million recorded in FY2026, ending March 2026)
• Increasing difficulty in securing immediately productive talent amid intensifying recruitment competition