Dentsu Group (4324) Q2 2026 earnings summary

Executive summary

• H1 FY2026 net revenue rose 3.7% year-over-year to JPY 583.1 billion, with organic growth of 0.3% and underlying operating profit up 6.6% to JPY 72.0 billion.

• Statutory net profit turned positive at JPY 46.3 billion, reversing a prior year loss, aided by asset sales.

• Japan delivered strong organic growth of 5.0%, while Americas and APAC saw organic declines and EMEA was broadly flat.

• The midterm plan focuses on profitability, cost reduction, and AI-driven transformation.

• Q2 2026 saw consolidated organic growth broadly flat, with operating margin at 11.9%, slightly above expectations.

Financial highlights

• Operating margin improved to 12.3% for H1 FY2026, up 30bps year-over-year.

• Underlying basic EPS was JPY 147.29, up 17.8% year-over-year.

• Statutory operating profit was JPY 83.9 billion, net profit JPY 46.3 billion, including one-off gains from asset sales.

• Net debt reduced to JPY 83.8 billion at end-June 2026.

• Cash flow from operations reached JPY 95.1 billion in H1.

Outlook and guidance

• Full-year 2026 organic growth guidance reiterated at 0%-1%, with operating margin target of 13%.

• Japan's full-year organic growth forecast raised to just over 3%; Americas revised down to circa -4%.

• Net revenue forecast: JPY 1,230.2 billion; underlying operating profit: JPY 166.3 billion.

• Basic EPS for the year projected at JPY 268.50.

• Midterm plan targets 2%-3% organic growth and 16% operating margin by 2028.