Japan Aviation Electronics Industry (6807) Q2 2026 earnings summary

Executive summary

• Net sales for 1H FY2025 declined year-over-year, mainly due to lower sales in mobile devices and challenging market conditions.

• Profitability was impacted by increased costs from new product launches, unfavorable product mix, exchange rate fluctuations, and higher raw material and trial production costs.

• Operating profit and net profit dropped significantly, with comprehensive income increasing 24.7% year-over-year due to improved other comprehensive income.

• Segment performance varied, with mobile and automotive markets declining, while aviation and space remained firm but oil drilling was weak.

Financial highlights

• Net sales for 1H FY2025 were JPY 1,104 billion, down 3% year-over-year; operating profit dropped to JPY 48 billion (4.3% margin), a 48% decrease; net profit fell to JPY 31 billion (2.8% margin), down 53%.

• Gross profit fell to ¥18,088 million from ¥22,490 million year-over-year, with gross margin compression.

• Basic earnings per share dropped to ¥46.23 from ¥98.45 year-over-year.

• Capital investments reached JPY 107 billion, depreciation was JPY 96 billion, and cash and cash equivalents at period-end were ¥48,023 million.

• Net assets increased to ¥136,886 million, with an equity ratio of 62.0%.

Outlook and guidance

• FY2025 full-year net sales projected at JPY 2,250 billion, slightly up year-over-year; operating profit forecast at JPY 100 billion (4.4% margin), net profit at JPY 60 billion (2.7% margin).

• Full-year net sales forecast revised to ¥225,000 million (up 1.5% year-over-year), with operating profit expected at ¥10,000 million (down 36.0%).

• Ordinary profit forecast at ¥9,000 million (down 39.3%), and profit attributable to owners of parent at ¥6,000 million (down 48.2%).

• Annual dividend forecast maintained at ¥60.00 per share.

• Market recovery in industrial and oil drilling segments is now expected in the next fiscal year.