Soracom (147A) Q3 2025 earnings summary

Executive summary

• Recurring revenue grew 21.2% year-over-year to 4,781 million JPY for Q3 YTD, maintaining double-digit growth.

• Total revenue increased 4.6% YoY to 5,705 million JPY, with incremental revenue expected to concentrate in Q4.

• Operating profit remained positive: 169 million JPY (Non-GAAP, down 74.0% YoY) and 123 million JPY (GAAP, down 80.9% YoY) for Q3 YTD.

• Full-year forecast revised downward due to timing shifts in incremental revenue, project delays, and investment losses.

• Growth strategies include global expansion, strategic alliances, and Gen AI × IoT initiatives.

Financial highlights

• Recurring revenue accounted for approximately 84% of total revenue in Q3 YTD.

• Gross profit margin was 57.6% in Q3 YTD, slightly down from 60.4% YoY; gross profit was 3,285 million JPY, nearly flat YoY.

• SG&A expenses rose 19.3% YoY to 3,161 million JPY, now 55.4% of revenue.

• Incremental revenue is expected to recover significantly in Q4, reaching 1.5 billion JPY.

Outlook and guidance

• FY25/3 full-year revenue forecast is 9,000 million JPY, up 13.5% YoY but 9.2% below initial guidance.

• Recurring revenue forecast at 6,550 million JPY, up 21.7% YoY.

• Non-GAAP operating profit forecast revised down to 721 million JPY, a 3.5% YoY decrease.

• Net income expected at 310 million JPY, 380 million JPY below prior forecast, due to revenue timing and impairment loss.

• Some recurring revenue delayed to next fiscal year due to project postponements.