SUBARU CO., LTD.

Business Details

A cram school (juku) business providing group lessons, individual tutoring, video-streamed lessons, and online individual tutoring to students ranging from preschoolers and elementary school pupils through high school graduates. The main market is the southern Kyushu area, centered on Kagoshima, Miyazaki, and Okinawa. The business is characterized by AI-driven independent learning support (Subaru LMS) linked with mock exam data to provide individually optimized learning support, and it began full-scale operation of "Subaru Kobetsu Online" from March 2026. Over 90% of revenue is generated from the single segment of education-related services.

Recent Overview

Revenue rose 2.5% year on year, but both operating and net losses widened compared to the prior-year period

Revenue for Q1 of FY2027 (ending February 2027) (March–May 2026) was ¥708 million (up 2.5% year on year), securing revenue growth, but the operating loss widened to ¥107 million (compared to -¥104 million in the prior-year period) and the net loss for the quarter widened to ¥86 million (compared to -¥66 million in the prior-year period). Enrolled student numbers remained below the prior year's level. On the other hand, the Preschool/Elementary Division (+10.1%), individual tutoring (+6.1%), and the High School Division (+2.4%) saw revenue growth. While the Kikuyo and Keyaki-dori classrooms were consolidated in March 2026, the company opened the Kobetsu Kengun classroom, established the Sokkai Seminar junior high entrance exam division, and launched Subaru Kobetsu Online in full. The full-year earnings forecast remains unchanged, maintaining revenue of ¥3,459 million and operating profit of ¥195 million.

Key Products

Growth Drivers

• Improved post-mock-exam study efficiency and higher student satisfaction through the introduction of "Subaru AI Hissho Navi"
• Increased student numbers in the High School Division's Okinawa operations due to a shift toward current high school students (2nd and 3rd year)
• Capture of new demand beyond geographic constraints through the full-scale launch of "Subaru Kobetsu Online"
• Strengthened individually optimized learning support through the integration of Subaru LMS with mock exam data
• Efficient use of human resources and reduced fixed costs through consolidation of school locations (Kikuyo and Keyaki-dori classrooms)
• Improved quality of educational services through expanded rollout of mutually interactive live lesson streaming in certain regions

Risks

• Declining demand for public high school entrance exams due to the falling birthrate and expanded private high school options resulting from free public high school tuition policies
• Reduced need to attend cram schools as public high schools increasingly fail to fill enrollment quotas, particularly pronounced in the southern Kyushu area
• Suppressed household spending on out-of-school education and stagnant enrollment growth due to elevated inflation and persistently high consumer price levels
• Continued risk that enrolled student numbers remain below prior-year levels and that the shortfall from the start of the fiscal year cannot be closed
• Increasing difficulty securing human resources amid labor shortages and rising personnel cost pressures
• Uncertainty in the operating environment stemming from global instability and financial market volatility