ORIX (8591) Q2 2027 earnings summary

Executive summary

• H1 net income reached ¥856.2bn, up ¥585.1bn YoY and equal to 162% of the FY27.3 forecast; adjusted profit was ¥317.5bn, excluding ¥538.7bn of after-tax KIOXIA gains.

• Record earnings also reflected growth in asset management, Aircraft, Ships and Insurance; Greater China impairments and U.S. business reviews remained areas of focus.

Financial highlights

• H1 revenue rose 9.6% YoY to ¥1,673.9bn; attributable net income increased 215.8% to ¥856.2bn, and continuing-operations pre-tax income rose 195.0% to ¥1,117.9bn.

• Q2 adjusted profit was ¥158.4bn versus ¥159.1bn in Q1; Q2 included ~¥100bn core profit, ~¥90bn from the ORIX Bank sale and ~¥30bn of Greater China impairments.

• KIOXIA sale and valuation gains were ¥417bn in Q2 and ¥538.7bn cumulative H1, after tax; H1 segment profit rose ¥749.6bn YoY to ¥1,147.4bn.

• H1 capital gains were ¥266.1bn; investment recoveries generated ~¥930bn cash inflows against ~¥340bn of new-investment outflows.

• Total expenses rose 11% to ¥1,434.4bn, while operating income increased 3.9% to ¥239.5bn; equity-method investment income was ¥809.6bn.

Outlook and guidance

• FY27.3 net income forecast remains ¥530bn; management cited steady adjusted-profit progress, while KIOXIA price volatility limits visibility on Q4 sale and valuation gains.

• At the September-end KIOXIA price of ¥18,095, estimated Q3 sale and valuation loss was ¥190bn after tax; each ¥1,000 share-price move changes after-tax gains by ¥12.8bn.

• Management cited an initial ~¥480bn adjusted-profit level after excluding KIOXIA-related profit from the original forecast; an update, dependent on share price, was expected by Q3 results at the latest.

• FY dividend forecast remains ¥187.36/share; policy provides for the higher of ¥156.10/share or 39% of adjusted EPS, based on adjusted net income excluding after-tax KIOXIA gains or losses.

• Full-year investment pipeline targets >¥800bn, including Aircraft, Ships, domestic real estate, PE and Osaka IR; the 11% ROE target remains unchanged, with further outlook review expected by the Q3 call.