JBCC Holdings Inc.

Business Details

Comprised of three categories: system integration (SI), Services, and Systems. Targeting primarily domestic mid-tier and large enterprises (annual revenue of ¥50 billion to ¥200 billion) as the main customer base, the segment provides comprehensive offerings including core system modernization through ultra-rapid development (JB Agile), the cloud managed service "EcoOne," and multi-cloud-compatible security services. For FY2026 (ending March 2026), full-year revenue was ¥73,879 million, accounting for 97.2% of consolidated revenue, making it the mainstay segment. It is positioned as the growth driver of the medium-term management plan "CHALLENGE 2026."

Recent Overview

All three focus businesses—cloud, security, and ultra-rapid development—achieved growth substantially exceeding the market average

For FY2026 full year, Information Solutions revenue was ¥73,879 million (up 8.8% year-on-year), gross profit was ¥23,055 million (up 16.7% year-on-year), and gross profit margin was 31.2% (up from 29.1% in the prior year), with profitability significantly improved. Cloud grew 38.2% year-on-year and security grew 32.2% year-on-year, substantially outpacing the market average. In the SI category, gross profit margin sharply improved from 30.9% to 37.4% due to progress on large-scale ultra-rapid development projects. Meanwhile, the Systems category shrank as planned, down 9.1% year-on-year. In the coming fiscal year (FY2027, ending March 2027), the SI segment is expected to see temporary declines in revenue and profit due to strategic investment in AI-driven development, while continued strong growth in cloud and security is anticipated.

Key Products

Growth Drivers

• Expanding cloud migration demand: Changes to VMware's licensing structure and price increases/delivery delays in server equipment amid tight semiconductor memory supply-demand have accelerated migration from on-premises to cloud, leading to large-scale order wins centered on EcoOne (cloud revenue up 38.2% year-on-year)
• Rising security demand: Amid intensifying cyberattacks such as ransomware and growing information leakage risks accompanying generative AI adoption, demand for managed security services has expanded, achieving growth substantially exceeding the market average (up 32.2% year-on-year). The Ministry of Economy, Trade and Industry's new system, the "Security Measures Evaluation System for Strengthening Supply Chains" (expected to launch around the end of FY2026), is expected to further boost demand
• Steady progress in ultra-rapid development: Large-scale core system rebuilding projects have progressed steadily, with SI revenue up 12.0% year-on-year and gross profit margin significantly improving from 30.9% to 37.4%. The over 10-year track record of the AI-driven development methodology "JB Agile" functions as a competitive advantage
• Comprehensive multi-cloud x security proposals: Integrated proposals combining cloud and security have led to larger deal sizes and increased order wins, with overall Services category revenue up 13.0% year-on-year and gross profit also up 13.0%
• Expanding generative AI adoption: Deal sizes for Microsoft Copilot and Microsoft 365 have been growing, with AI-related demand emerging as a new growth driver. The company aims to differentiate through proprietary solutions such as ATTAZoo Governance and governance enhancement proposals
• Shift toward stock-type business: With a view toward transforming the business model from a "outsourced flow-type business" to a "collaborative stock-type business," the company is promoting the development of a recurring revenue model through the establishment of an AI Orchestration Platform

Risks

• Large-project execution risk: Multiple core system modernization projects are underway in ultra-rapid development, and delays in large-scale projects could have a significant impact on results
• Temporary decline in SI revenue and profit due to AI strategic investment: In the coming fiscal year (FY2027, ending March 2027), the company plans temporary declines in SI segment revenue and profit due to strategic investment in AI-driven development, with uncertainty regarding the timing and scale of investment returns
• Structural decline in the Systems category: Hardware and software sales are on a medium- to long-term declining trend due to progressing cloud migration (down 9.1% year-on-year in FY2026 full year), requiring continued compensation through growth in other categories
• Increase in selling, general and administrative expenses: SG&A expenses for FY2026 full year were ¥16,883 million (up 14.0% year-on-year), increasing at a pace exceeding revenue growth (up 8.8%), warranting close attention to the impact on profit margins
• IT talent shortage: Securing and developing advanced technical personnel could become a constraint on business expansion, requiring investment in developing AI-driven development talent. The ability to respond to large-scale projects requiring concentrated human resources is being tested
• Intensifying competition: As the cloud and security markets grow, competition with major system integrators and specialized vendors may intensify, requiring continuous expansion of differentiated services
• External environment risks: Economic uncertainty stemming from external factors such as tariffs, foreign exchange, and geopolitical risks could affect customer companies' IT investment decisions