Renesas Electronics (6723) Q4 2025 earnings summary

Executive summary

• Fourth quarter revenue reached JPY 350.9 billion, up 19.9% year-over-year, with full-year revenue at JPY 1,321.2 billion, down 2.0% year-over-year, mainly due to a decline in Automotive, partially offset by Industrial/IoT growth.

• Gross margin improved to 59.3% in Q4 and 57.6% for the year, driven by lower manufacturing costs.

• Operating profit for Q4 was JPY 108 billion (30.8% margin), with full-year non-GAAP operating profit at JPY 386.9 billion, down 2.8% year-over-year.

• Net loss attributable to owners was JPY 51.8 billion, mainly due to impairment losses and finance costs.

• AI and Industrial/IoT demand were robust, while Automotive growth was moderate and China slowed.

Financial highlights

• Q4 revenue: JPY 350.9 billion; gross margin: 59.3%; operating profit: JPY 108 billion; EBITDA: JPY 127.8 billion; net profit: JPY 90 billion.

• Full-year revenue: JPY 1,321.2 billion; gross margin: 57.6%; non-GAAP operating profit: JPY 386.9 billion; EBITDA: JPY 389.8 billion; net loss: JPY 51.8 billion.

• Dividend maintained at JPY 28 per share, totaling JPY 50.8 billion.

• Free cash flow was JPY 328.2 billion, a positive turnaround from the previous year.

• Year-over-year, revenue declined 2.0%, but gross margin improved by 1.6% due to cost reductions.

Outlook and guidance

• Q1 2026 revenue forecast: JPY 375 billion, up 6.9% QoQ and 21.4% YoY; gross margin: 58.5%; operating margin: 32%.

• Non-GAAP Q1 2026 revenue guidance: JPY 367.5–382.5 billion, gross margin 58.5%, operating margin 32.0%.

• Automotive and IIoT expected to show moderate growth; AI and data center demand remain strong.

• No full-year numerical guidance provided yet; momentum is improving.

• Dividend for FY2025 set at JPY 28 per share; future dividends undecided.