Trend Micro (4704) investor relations material

Executive summary

• Emphasis on AI-driven transformation, specialized data collection, and decision support, with reorganization into enterprise (Trend AI), consumer (Trend Life), and physical AI security (VicOne), plus the Magna AI infrastructure venture.

• Achieved record quarterly and annual net revenues and operating income for FY2025, with Q4 net sales up 5% and full-year net sales up 1.2%.

• Operating income margin improved to 21% for the year, driven by cost controls and strong enterprise performance.

• Strategic partnerships with NVIDIA and Wistron to enhance AI security and infrastructure, and launch of Magna joint venture targeting sovereign AI.

• Enterprise segment drove growth, while consumer segment faced headwinds from e-commerce disruption and regional weakness.

Financial highlights

• FY2025 net sales: ¥275,984M (+1.2% YoY); operating income: ¥57,777M (+20.1% YoY); net income: ¥34,523M (+0.5% YoY); Q4 net sales up 5% YoY.

• Total recurring revenue reached $1.7 billion, up 1% year-over-year.

• Cash and cash equivalents at year-end: ¥230,458M (+23% YoY).

• Dividend per share: ¥185 (+1% YoY), with a 70% payout ratio.

• Gross margin improved as cost of sales and operating expenses fell 2.8% year-over-year.

Outlook and guidance

• FY2026 guidance: net sales ¥301,500M (+9.2%), operating income ¥56,400M (-2.4%), net income ¥36,600M (+6%).

• ARR growth targeted at 13% and net sales growth at 9% for 2026, with a temporary margin dip due to increased investment.

• Enterprise (Trend AI) ARR targeted to grow 15% in 2026; consumer (Trend Life) ARR targeted at 6% growth.

• Sales growth expected in all regions, with Americas and Europe forecasted to grow ~10% and Asia Pacific in the mid-teens.

• Continued investment in hyper-growth areas (VicOne, Magna AI) and R&D expected to drive future expansion.