NEC (6701) Q3 2025 earnings summary

Executive summary

• Revenue for the nine months ended December 31, 2024, was JPY 2,321.8 billion, with strong performance in domestic IT services and aerospace/national security, and non-GAAP operating profit at JPY 162.3 billion, exceeding expectations and prompting upward forecast revisions.

• Adjusted operating profit increased to JPY 150.2 billion, up JPY 53.2 billion year-over-year, reflecting improved profitability and cost reductions.

• Net profit attributable to owners of the parent more than doubled year-over-year to JPY 108.4 billion, with EPS rising to JPY 407.

• Upward revision to full-year forecasts, with non-GAAP OP now expected at JPY 280 billion, up JPY 25 billion from previous guidance.

• Ownership in NEC Networks & System Integration Corporation increased to 73.90% via tender offer, with plans to make it a wholly owned subsidiary and delist.

Financial highlights

• Adjusted operating profit for the nine months reached JPY 150.2 billion, up JPY 53.2 billion year-over-year; margin improved to 6.5%.

• Non-GAAP net profit forecast for the year is JPY 182 billion, up JPY 17 billion.

• EBITDA increased to JPY 254.5 billion, up JPY 39.7 billion year-over-year.

• Dividend per share forecast for FY2025 is JPY 140, up from JPY 120 in FY2024.

• Free cash flow improved to -JPY 1.6 billion from -JPY 19.0 billion year-over-year.

Outlook and guidance

• Full-year revenue forecast raised to JPY 3,410 billion, with adjusted operating profit forecast at JPY 260 billion and non-GAAP OP at JPY 280 billion.

• Non-GAAP profit attributable to owners of the parent is expected to reach JPY 182 billion, with non-GAAP EPS at JPY 683.04.

• EBITDA forecast raised to JPY 405 billion; ROIC expected at 11.9%.

• Dividend per share guidance maintained at JPY 140.

• Segment guidance reflects continued strength in IT services and some risk in telecom services.