ARCS (9948) Q1 2026 earnings summary

Executive summary

• Revenue reached a record ¥154,294 million, up 3.7% year-over-year for the first quarter ending May 31, 2025, driven by higher unit prices and increased customer visits despite ongoing inflation and consumer thriftiness.

• Operating profit was ¥3,874 million, nearly flat year-over-year (+0.1%), as higher gross profit was offset by increased personnel and card fees.

• Net income attributable to shareholders rose 5.1% year-over-year to ¥2,798 million, aided by lower corporate taxes.

• The group focused on productivity improvements, price competitiveness, and digital transformation to counteract inflationary pressures.

Financial highlights

• Gross profit increased 3.5% year-over-year to ¥38,612 million, with a gross margin of 25.0%.

• SG&A expenses rose 3.9% to ¥34,737 million, keeping the SG&A ratio steady at 22.5%.

• Operating margin was 2.5%, down 0.1 percentage points year-over-year.

• Ordinary profit declined 0.7% to ¥4,233 million, while net margin remained at 1.8%.

• EPS for the quarter was ¥51.85, up from ¥49.35 a year earlier.

Outlook and guidance

• Full-year revenue is forecast at ¥623,000 million (+2.4% year-over-year), with operating profit of ¥16,400 million (+2.9%) and net income of ¥11,200 million (+1.2%).

• No changes have been made to previously announced guidance.

• Interim and year-end dividends are projected at ¥37.00 each, totaling ¥74.00 per share for the year.