KAWAI MUSICAL INSTRUMENTS MANUFACTURING CO.,LTD.
7952・Prime Market・Other Products
Business
Kawai Musical Instruments Manufacturing traces its roots to a piano maker founded in 1927 and now operates a group of 23 companies at home and abroad across three businesses: Musical Instrument Education, Materials Processing, and IT-related operations. In its core Musical Instrument Education Business, the company manufactures and sells grand pianos, upright pianos, digital pianos and other instruments, and also operates Music School / Gymnastics School locations both in Japan and overseas, publishes sheet music, and provides tuning services, covering the entire value chain. Manufacturing sites are spread across Indonesia, China, and Japan (including the Shizuoka Ryuyo Plant, among others), and sales are conducted globally through a network of local subsidiaries and distributors in North America, Europe, Asia and elsewhere. In the Materials Processing Business, the company handles special-profile rolled metal products and soundproof rooms, supplementing group earnings. Major customers span a wide range, including individual music enthusiasts, music school students, professional performers, and corporate clients such as research institutions and medical facilities.
Business Model
The company adopts a composite model combining one-time revenue from musical instrument sales with recurring revenue from monthly tuition fees at Music School / Gymnastics School. Domestically, it links directly-operated stores and its agency network with music schools, creating a cyclical structure that guides school students toward becoming instrument purchasers. Overseas, local subsidiaries handle sales and school operations, while the expansion of directly-operated stores creates opportunities for brand experience. The stable operating profit from the Materials Processing Business underpins the earnings of the group as a whole.
Company Strengths
At the 19th International Chopin Piano Competition in November 2025, three of the six prize winners chose the SK-EX. Winners at the Paderewski International Piano Competition in December of the same year and the Takamatsu International Piano Competition in February 2026 also chose the SK-EX, and this consecutive track record of adoption on the world's most prestigious stages objectively substantiates the brand's reputation.
The company operates local sales subsidiaries in North America, Europe, Asia, and Oceania, and newly opened four directly-operated stores in total (two in Australia and two in the U.S.) between July 2025 and February 2026. Domestically, the Kawai Music School, established in 1956, operates nationwide, and the depth of customer touchpoints achieved by linking instrument sales with music school operations is a proprietary asset that is difficult for competitors to replicate in a short period.
While the Musical Instrument Education Business recorded an operating loss of ¥852 million in FY2026 (ending March 2026), the Materials Processing Business secured net sales of ¥10,343 million and operating profit of ¥756 million (operating margin of 7.3%). Increased sales of metal-processed products driven by growing semiconductor demand and strong performance of the Nasal soundproof rooms contributed to results, and the segment functions as the group's only consistently profitable segment.
ENVALITH's Perspective
Performance Trend
Revenue for FY2026 (ending March 2026) was ¥72,049 million (down 1.2% year on year), marking a fifth consecutive period of declining revenue. Operating profit was ¥113 million (down 64.2% year on year), remaining at a near-zero level. On the other hand, ordinary profit rose sharply to ¥952 million (up 100.6% year on year), and profit attributable to owners of parent increased significantly to ¥1,141 million (up 181.7% year on year); however, this improvement was driven by non-recurring factors such as foreign exchange gains of ¥791 million and gains on redemption of investment securities of ¥655 million. In terms of the external environment, the continuation of China's double reduction policy, intensifying price competition in Europe, and uncertainty over US tariff policy have weighed on demand for musical instruments. While solid performance in the high value-added segment in North America and Japan provided some support, the overall pace of recovery fell short of expectations.
Growth Strategy
Under the "KAWAI 10-Year Plan," the company is pursuing higher value-added products, market share expansion, and sales channel expansion.
Rebranding of the Grand Piano "GX Series" and expansion of the "Shigeru Kawai Series" centered on the full concert piano "SK-EX." The company aims to enhance brand value through continued selection achievements at the Chopin, Paderewski, and Takamatsu International Piano Competitions, among others, thereby improving the mix from mass-market to high value-added price ranges.
A total of 4 new directly managed stores were opened between July 2025 and February 2026: 2 stores in Australia and 2 stores in the United States. Using these directly managed stores as bases, the company aims to create product experience opportunities through partnerships with music professionals and artist support, promoting regional music development and penetration of the Kawai brand. Development of new markets such as Latin America is also being pursued in parallel.
The company is promoting the strengthening of digital marketing and dealer development, including the e-commerce market, to expand customer touchpoints via online channels. By combining these with existing face-to-face sales channels, the company aims to expand its reach to a broader customer base and improve sales efficiency.
In October 2025, the company opened its first showroom dedicated to soundproof rooms, the "Kawai Acoustic System Soundproof Showroom," in Tokyo. Since its opening, this showroom has contributed to an increase in orders for soundproof rooms, contributing to revenue expansion in the acoustics business within the Materials Processing Business. This strengthens the function of supplementing earnings in the Musical Instrument Education Business.
For FY2027 (ending March 2027), consolidated financial forecasts call for net sales of ¥80,000 million (up 11.0% year on year), operating profit of ¥1,800 million, ordinary profit of ¥1,900 million, and profit attributable to owners of parent of ¥1,600 million. Sales recovery in overseas markets is assumed to be the main driver of revenue growth. The assumed exchange rates are 1 US$ = ¥155, 1 euro = ¥185, and 1 yuan = ¥22.
Last updated: July 19, 2026