Nidec (6594) Q2 2025 earnings summary

Executive summary

• Net sales for the first half of FY2024 rose 11.8% year-over-year to ¥1,293.8 billion, marking a record high, with operating profit up 4.9% to ¥121.0 billion, both driven by growth across multiple business segments.

• Profit before income tax declined 30.9% to ¥100.2 billion, mainly due to yen depreciation and related valuation losses.

• Profit attributable to owners of the parent dropped 28.5% year-over-year to ¥75.6 billion, impacted by FX losses and higher costs.

• A new management system was implemented, focusing on group-wide integration and profitability.

• Major acquisitions, including Nidec PSA emotors and Linear Transfer Automation, contributed to segment growth.

Financial highlights

• Yen depreciation contributed to a ¥70.9 billion increase in revenue but negatively impacted profitability.

• Operating profit margin for 1H FY2024 was 9.4%, down from 10.0% year-over-year.

• Free cash flow for 1H FY2024 was ¥28.0 billion, down from ¥97.8 billion year-over-year.

• EPS decreased to ¥65.76 from ¥91.99 year-over-year (−28.5%).

• Interim dividend per share increased to ¥40.00.

Outlook and guidance

• FY2025 guidance: net sales ¥2,500,000 million (+6.5% YoY), operating profit ¥240,000 million (+48.3% YoY), profit attributable to owners ¥185,000 million (+48.6% YoY), EPS ¥160.98.

• Full-year guidance remains unchanged despite strong first-half results, reflecting management caution amid uncertainties.

• Management targets sales of ¥3 trillion in six years and ¥7 trillion by 2030, with a long-term milestone of ¥10 trillion.

• Water cooling module business expected to double revenue to ¥80 billion next fiscal year, driven by next-gen GPU launches.

• Assumed FX rates for Q3 onward: ¥145/USD and ¥155/Euro.