SUBARU CO., LTD.
9778・Standard Market・Services
Business
Kabushiki Kaisha Subaru traces its origins to its founding in 1965 (incorporated in 1972) and operates as a single-segment company running cram schools (juku) primarily across the southern Kyushu area, including Kagoshima, Miyazaki, Kumamoto, and Okinawa. It provides exam-preparation instruction across a wide age range—from preschoolers and elementary school students to junior high and high school students, as well as high school graduates—through diverse formats including group instruction, individualized tutoring, and video-based lessons (Toshin Satellite Prep School). As of the end of February 2025, the company operated 65 school locations with 438 classrooms and a seating capacity of 13,662, and is listed on the Standard Market of the Tokyo Stock Exchange.
Business Model
The company recruits students directly based on its enrollment guidelines, with tuition fee income as its main revenue source. By segment, sales are highest in the junior high school division at ¥1,771 million (51.3% of total), followed by the preschool/elementary division at ¥931 million, the high school division at ¥454 million, and individual tutoring at ¥199 million. Because the cost structure is dominated by fixed costs, changes in student numbers directly affect profit margins. The company aims to improve profitability by reducing fixed costs through school consolidation and by enhancing learning support through AI-powered Subaru LMS (Learning Management System).
Company Strengths
Since its founding in 1965, the company has expanded to 65 campuses across Kagoshima, Miyazaki, Kumamoto, and Okinawa. Its history of over 50 years and track record of community-based instruction have built a foundation of trust among parents and students, and its brand recognition and strength in southern Kyushu function as a barrier to entry against competitors.
The company links mock exam data with its AI-equipped self-directed learning support system, "Subaru LMS," to provide optimized learning support tailored to each student. It has also been developing live lecture streaming infrastructure, building a system that delivers high-quality educational services regardless of time or location.
Total net assets stood at ¥3,570 million as of the end of February 2025. Total capital expenditure for the fiscal year of ¥180 million (including ¥95 million for investment real estate in Kumamoto City and ¥47 million for the new Nakayama campus site, among others) was funded entirely from internal funds, maintaining a financial management approach that does not rely on external borrowing.
ENVALITH's Perspective
Performance Trend
Revenue peaked at ¥3,840 million in FY2022 and declined for five consecutive fiscal years to ¥3,376 million in FY2026. Cumulative Q1 of FY2027 (ending February 2027) came to ¥708 million (up 2.5% year on year), turning to a slight revenue increase, but gross profit shrank to ¥25 million (versus ¥27 million in the same period a year earlier) due to an increase in cost of sales to ¥683 million (versus ¥665 million a year earlier). Operating loss of ¥107 million worsened year on year. As external factors, the decline in the competitiveness ratio for public high schools resulting from the free public high school tuition policy has depressed demand from the junior high school segment, while sustained high consumer prices have suppressed household spending on tutoring. The full-year forecast calls for a significant improvement, with revenue of ¥3,459 million (up 2.4% year on year), operating profit of ¥195 million, and net income of ¥133 million (up 232.5% year on year), but given the Q1 progress, achieving this will require a substantial recovery in the second half.
Growth Strategy
Aiming to rebuild the revenue structure through DX initiatives, strengthening of the Okinawa Senior High School Department, online expansion, and optimization of school locations
Introduced the AI-powered 'Subaru AI Success Navigator' (Subaru AI Hissho Navi) from FY2026, strengthening individually optimized learning by linking mock exam data with the Subaru LMS (Learning Management System). Aims to suppress student withdrawal and drive word-of-mouth acquisition through improved academic performance and satisfaction among enrolled students.
Fully launched 'Subaru Kobetsu Online' from March 2026. Aims to capture demand from outside the existing market area through a new approach targeting students unable to attend physical school locations. Also seeks to standardize educational quality through combination with mutual live-lesson streaming.
In light of the declining trend in ronin (repeat) students, shifted operations to focus primarily on 2nd- and 3rd-year high school students. Leveraging the external environment of growing preference for advancing directly from high school, achieved increased enrollment of 2nd- and 3rd-year high school students. An increase in student numbers has been confirmed in the Okinawa division.
In March 2026, consolidated Kikuyo School and Keyaki-dori Classroom with nearby classrooms, while simultaneously establishing Kobetsu Kengun Classroom and the Sokkai Seminar Junior High School Entrance Exam Division. Aims to optimize labor costs and facility costs by optimizing the school location portfolio in response to market trends.
Promotes the diversification of the university entrance examination system and raises awareness of the need to begin studying from elementary and junior high school age, encouraging early enrollment and long-term retention. Aims to support demand for the junior high school department amid the headwind of declining competition rates for public high schools due to free high school tuition.
Last updated: July 17, 2026