SHIFT (3697) investor relations material

Executive summary

• Net sales for the nine months ended May 31, 2026, rose 21.4% year-over-year to ¥115,848 million, driven by robust sales activities and the consolidation of Nisseicom, Limited.

• FY2026 net sales guidance raised to JPY 160.0bn, reflecting strong sales momentum, successful M&A integration, and expansion of AI-related services.

• AI-related revenue accounted for up to 19% of total revenue, with AI gross margin at 43%, and AI net sales surged 3.1x quarter-on-quarter.

• Operating profit declined 4.3% year-over-year to ¥11,383 million, mainly due to increased recruitment expenses and a temporary drop in utilization rates.

• The company introduced its first-ever dividend (JPY 4.1/share) and a 20% total payout ratio policy.

Financial highlights

• Q3 net sales reached JPY 43.8bn (+29.9% YoY), with consolidated AI sales at JPY 7.9bn (18% of total).

• Adjusted operating profit for Q3 was JPY 5.2bn (+23.0% YoY), and adjusted operating margin was 11.9%.

• Gross margin was soft at 32.5%–32.8% in Q3, but expected to improve with higher utilization and AI revenue mix.

• SG&A ratio improved to 20.7% (YoY -1.5pts) from efficiency gains and AI BPaaS adoption.

• Adjusted net profit revised down to JPY 9.0bn due to a one-off impairment loss.

Outlook and guidance

• Full-year net sales forecast is ¥160,000 million (+23.2% year-over-year), with adjusted operating profit projected at ¥20,000 million (+13.4%).

• FY2027 targets: net sales of JPY 190–200 billion, gross margin of 34.5–35%, and operating profit of JPY 25.5–30.0 billion.

• Utilization expected to recover to prior-year levels in July, supporting margin improvement.

• Dividend forecast for FY2026 is ¥4.10 per share, marking the commencement of dividend payments.

• AI and large project wins are expected to drive future growth, with a focus on organic expansion and improved utilization.