ELEMENTS (5246) Q2 2026 earnings summary

Executive summary

• Achieved record quarterly revenue of ¥1,507 million, up 55% year-over-year, and cumulative six-month revenue of ¥2,799 million, up 65.6% year-over-year, driven by strong eKYC, AI cloud-based authentication, and Polarify consolidation.

• Operating profit reached ¥207 million for the quarter and ¥327 million cumulatively, with EBITDA at ¥383 million for the quarter and ¥648 million for the half-year, both showing significant year-over-year increases.

• Net income attributable to shareholders turned positive at ¥196 million for the quarter and ¥297 million for the half-year, reversing prior year losses.

• Full-year guidance was upgraded, raising revenue, profit, and EPS forecasts based on robust first-half results and ongoing investment in new products.

• Continued focus on expanding core domestic services amid growing digital transformation demand.

Financial highlights

• Quarterly revenue: ¥1,507 million (+55% YoY); cumulative revenue: ¥2,799 million (+66% YoY); gross profit for the half-year: ¥2,177 million.

• Gross profit margin for the quarter: 79.4% (excluding Polarify: 88.6%).

• SG&A expenses rose 37% YoY to ¥988 million, with SG&A-to-sales ratio improving to 65.6%.

• Operating profit margin improved from 1.0% to 11.7% YoY; operating cash flow was ¥527 million, up from ¥202 million YoY.

• Cash and cash equivalents at period-end were ¥2,332 million; total assets at ¥6,766 million; net assets at ¥3,872 million.

Outlook and guidance

• Full-year revenue forecast raised to ¥5,600–5,700 million (from ¥5,100–5,300 million).

• Operating profit forecast increased to ¥300–400 million; EBITDA forecast revised up to ¥1,100–1,200 million; net income guidance raised to ¥200–300 million.

• Earnings per share guidance revised upward to ¥7.34–11.01.

• Continued investment in new products and long-term profit maximization expected to moderate profit growth pace in the second half.