Sansan (4443) Q1 2025 earnings summary

Executive summary

• Net sales rose 27.7% year-over-year to ¥9,584 million, with annual recurring revenue (ARR) up 29.6% YoY to ¥35,133 million and gross profit also up 27.7% to ¥8,313 million with a gross margin of 86.7%.

• Adjusted operating profit increased 44.4% YoY to ¥207 million, despite higher personnel and rent expenses from headcount growth and head office relocation.

• Ordinary profit and profit attributable to owners were negative due to a significant increase in share-based payment expenses, resulting in an ordinary loss of ¥329 million and a net loss attributable to owners of parent of ¥372 million.

• The company expects to record a ¥416 million gain on sale of investment securities as extraordinary income in Q2 FY2024.

Financial highlights

• Operating profit swung from ¥120 million in Q1 FY2023 to a loss of ¥325 million in Q1 FY2024.

• Basic earnings per share dropped from ¥0.25 to ¥(2.96) year-over-year.

• Comprehensive income fell from ¥55 million to a loss of ¥500 million year-over-year.

• Gross profit grew 27.7% YoY to ¥8,313 million, with a gross margin of 86.7%.

• Share-based payment expenses surged to ¥500 million, impacting ordinary profit and net income.

Outlook and guidance

• Full-year net sales forecasted to grow 27.0%–30.0% YoY, reaching ¥43,026–¥44,042 million, with adjusted operating profit projected at ¥3,012–4,404 million (up 76.2–157.6%).

• Adjusted operating profit margin expected to improve by 2.0–5.0 points YoY, targeting 7.0%–10.0%.

• Medium-term policy aims for a 22%–27% CAGR in net sales through FY2026 and an 18%–23% adjusted operating profit margin by FY2026.

• No change to previously announced earnings forecasts.