Sankyo (6417) Q2 2027 earnings summary

Executive summary

• H1 FY3/2027 revenue fell 19.3% YoY to ¥81,025 million and operating income declined 30.0% to ¥27,307 million, mainly due to lower pachinko sales; results were broadly in line with full-year forecasts.

• Pachislot growth partly offset the pachinko decline, with revenue up 44.7% and operating income up 70.5% YoY.

Financial highlights

• Recurring income declined 28.8% to ¥28,428 million; net income attributable to owners of parent fell 28.8% to ¥20,499 million.

• Gross profit was ¥48,330 million, down 18.8%; SG&A rose 2.6% to ¥21,022 million, including a 47.4% increase in advertising expense.

• Net sales decreased ¥19,384 million YoY: pachinko contributed a ¥24,852 million decline, partly offset by pachislot growth of ¥7,748 million; ball-bearing sales fell ¥2,293 million.

Outlook and guidance

• FY3/2027 forecasts unchanged: revenue ¥174,000 million, operating income ¥56,000 million, recurring income ¥58,000 million and net income ¥40,000 million; H1 progress was 46.6%, 48.8%, 49.0% and 51.2%, respectively.

• Full-year unit targets are 225,500 pachinko machines and 127,000 pachislot machines; H1 progress was 46.6% and 36.3%, respectively.

• Five new pachislot titles are planned for H2; pachinko offerings from Q3 include mainstay series and titles with new gaming performance.