Nidec (6594) Q1 2026 earnings summary

Executive summary

• Preliminary Q1 FY2025 results were disclosed ahead of full reporting due to ongoing investigations into country-of-origin labeling and trade/tariff issues at subsidiaries, with a three-month extension for official financial reporting.

• Net sales declined 1.6% year-over-year to JPY 637.9 billion, with operating profit up 2.3% to JPY 66.15 billion, but profit before tax fell 24.5% and net profit dropped 18.5%.

• EPS decreased 18.5% year-over-year to JPY 39.70.

• The company is executing a mid-term plan focused on structural reform, cost reduction, profitability, and global expansion.

• Results may be revised pending outcomes of additional investigations.

Financial highlights

• Net sales: JPY 637.9 billion, down 1.6% year-over-year.

• Operating profit: JPY 66.15 billion, up 2.3% year-over-year.

• Profit before tax: JPY 59 billion, down 24.5% year-over-year.

• Net profit attributable to owners: JPY 45.5 billion, down 18.5% year-over-year.

• Free cash flow for Q1 was JPY 9.8 billion, a significant improvement from the previous year.

Outlook and guidance

• Full-year financial forecast remains unchanged despite Q1 declines; FY2025 forecast: net sales JPY 2,600 billion, operating profit JPY 260 billion, operating margin 10%.

• Significant business conversion and profit improvement expected in Q3 and Q4, driven by high demand in alternator power generators and structural reforms.

• Ongoing focus on cost reduction: JPY 100 billion variable and JPY 50 billion fixed cost cuts targeted by 2027; mid-term plan targets operating profit ratio of 12% and ROIC of 12% by FY2027.

• Every JPY 1 change in USD/JPY impacts annual net sales by JPY 10 billion and operating profit by JPY 1.1 billion.