NEC (6701) Q2 2026 earnings summary

Executive summary

• Revenue for the first half of FY ending March 2026 rose 5.6% year-on-year to JPY 1,569.8 billion, driven by strong domestic IT and aerospace/defense segments.

• Non-GAAP operating profit for the first half increased by JPY 62.7 billion year-on-year to JPY 127.5 billion, reflecting improved profitability and operational efficiency.

• Adjusted operating profit reached JPY 131.6 billion, up JPY 70.6 billion year-on-year, with an adjusted OP margin of 8.4%.

• Upward revision of full-year forecast: non-GAAP OP increased by JPY 20 billion to JPY 340 billion.

• Major acquisition of CSG Systems International, Inc. announced to strengthen the telecom software and services business.

Financial highlights

• Gross profit for the first half increased to JPY 489.3 billion, with EBITDA at JPY 190.9 billion and EBITDA margin at 12.2%.

• Non-GAAP net profit for the first half reached JPY 78.6 billion, up JPY 41.2 billion year-on-year.

• Basic and diluted earnings per share rose to JPY 54.65, reflecting the share split.

• Cash flows from operating activities improved to JPY 177.4 billion.

• Dividend per share increased by JPY 2 to JPY 16 for the period.

Outlook and guidance

• Full-year revenue forecast for March 2026 is JPY 3,420 billion, with adjusted OP projected at JPY 330 billion and non-GAAP net profit at JPY 245 billion.

• Non-GAAP earnings per share forecast is JPY 183.78.

• ROIC for FY26/3 is forecast at 13.6%.

• Dividend per share for the full year maintained at JPY 32.

• Risk expenses for business environment fluctuations have been incorporated into projections.