Kokusai Electric (6525) investor relations material

Executive summary

• Quarterly revenue reached JPY 75.4 billion, up 46% year-over-year, driven by strong DRAM and logic foundry equipment and service sales, especially to non-China customers and AI-related demand.

• Operating profit increased 63.9% year-over-year to JPY 15.9 billion; adjusted operating income rose 59% to JPY 17.4 billion.

• Net income attributable to owners of the parent grew 70.6% year-over-year to JPY 11.6 billion; comprehensive income reached JPY 12.0 billion, up 56.4%.

• Orders received in Q1 reached JPY 140 billion, exceeding forecasts, with strong momentum expected to continue.

• Both revenue and profit exceeded previous forecasts, prompting upward revision of full-year guidance and dividend forecasts.

Financial highlights

• Revenue: JPY 75.4 billion (+46% YoY); adjusted operating income: JPY 17.4 billion (+59% YoY); net income: JPY 11.6 billion (+70.6% YoY).

• Gross profit margin: 40.7% (down 2.2 pts YoY, up 1.3 pts QoQ); gross profit: JPY 30.7 billion.

• Net cash position maintained at JPY 6.6 billion; free cash flow for Q1 was JPY 6.6 billion.

• R&D expenses: JPY 4.5 billion (5.9% of revenue); CapEx: JPY 4.8 billion; Depreciation: JPY 3.9 billion.

• Basic earnings per share increased to JPY 49.47 from JPY 29.08 year-over-year.

Outlook and guidance

• Full-year revenue forecast raised by 21% to JPY 340 billion (+45% YoY); adjusted operating income forecast up 42% to JPY 86 billion (+81% YoY).

• Adjusted net income forecast for FY27 raised by 40% to JPY 60 billion (+76% YoY); net income attributable to owners projected at JPY 55.5 billion (+84.4% YoY).

• Dividend forecast increased to JPY 65 per share, payout ratio projected at 25.2%.

• Equipment sales and service revenue expected to significantly exceed previous forecasts due to rapid capital investment by device manufacturers.

• WFE market for 2026 now expected to grow over 25% YoY to $140 billion, driven by AI-related investments.