SHIFT (3697) Q4 2026 earnings summary

Executive summary

• FY2026 net sales reached ¥161.6bn (+24.5%) and adjusted operating profit ¥20.259bn (+14.8%), exceeding targets; Q4 adjusted operating profit rose 69% YoY.

• Sales reforms revived organic growth; AI services gained traction, and back-office AI delivered productivity equivalent to 113 FTEs.

• Growth reflected stronger sales, acquisition consolidation and rising AI-related services; recruitment costs and lower utilization constrained operating profit growth.

• Strategy targets ¥300bn in sales through AI-enabled services, productivity improvements and M&A-led expansion.

Financial highlights

• FY2026 net sales were ¥161.6bn, up 24.5%; gross profit was ¥54.2bn and reported operating profit was ¥17.445bn, up 11.6%.

• Adjusted operating profit was ¥20.259bn, up 14.8%; adjusted net income was ¥10.12bn, versus a ¥9bn target.

• Reported net income attributable to owners was ¥7.43bn, down 16.8%; ordinary profit fell 12.3% to ¥13.32bn, primarily amid a ¥3.861bn equity-method loss.

• Q4 net sales were ¥45.8bn, up 33%; adjusted operating profit was ¥7.1bn, up 69%, and adjusted net income was ¥4.4bn, up 40%.

• EBITDA was ¥21.604bn, up 14.5%; adjusted ordinary profit was ¥16.162bn, down 6.0%, and adjusted profit attributable to owners was ¥10.12bn, down 7.6%.

Outlook and guidance

• FY2027 base budget: revenue ¥190bn (+17.6%), adjusted operating profit ¥25bn (+23.4%; 13.2% margin) and adjusted net profit ¥16.5bn (+63.0%).

• FY2027 stretch targets: revenue ¥200bn (+24%), adjusted operating profit ¥31.4bn (+55%; 15.7% margin) and adjusted net profit ¥21.2bn (+109%).

• FY2027 gross-margin targets are 34.5% base and 36.0% stretch; stretch assumes 25% of sales with AI and 3% Native AI.

• FY2030 base targets are ¥300bn revenue and ¥52.5bn adjusted operating profit; stretch targets are ¥365bn and ¥87.5bn, respectively.

• Priorities include AI-driven productivity, service upgrades, business-domain expansion and strategic investment; FY2027 guidance allows flexible investment and contingency spending.