TDK (6762) Q1 2027 earnings summary

Executive summary

• Net sales reached ¥741.0 billion in Q1 FY March 2027, up 38.3% year-over-year, with operating profit at ¥86.3 billion, up 53.0%, both setting record highs, driven by robust demand in AI data centers and new smartphone launches despite a decline in ICT-related product production.

• All business segments—Passive Components, Sensor Application Products, Magnetic Application Products, and Energy Application Products—achieved significant year-on-year growth in both sales and operating profit.

Financial highlights

• Net sales: ¥741.0 billion (+38.3% YoY); operating profit: ¥86.3 billion (+53.0% YoY); net profit attributable to owners: ¥80.6 billion (+94.4% YoY); EPS: ¥42.45.

• Foreign exchange movements contributed ¥72.5 billion to net sales and ¥11.3 billion to operating profit.

• Free cash flow for Q1: ¥21.4 billion, up ¥35.7 billion year-over-year.

• Gross profit margin slightly decreased to 30.7% from 31.7% YoY.

• Overseas sales accounted for 92.7% of total sales, up 0.6 percentage points YoY.

Outlook and guidance

• FY March 2027 projections unchanged: Net sales ¥2,580.0 billion (+3.0%), operating profit ¥295.0 billion (+8.3%), net profit attributable to owners ¥225.0 billion (+15.0%).

• Annual dividend forecast for FY2027 is ¥40.00 per share, up from ¥36.00 in FY2026.

• Q2 sales expected to grow across all segments, with projected increases in Passive Components (2%-5%), Sensor Application Products (3%-6%), Magnetic Application Products (6%-8%), and Energy Application Products (9%-12%).

• Exchange rate assumptions for the remainder of FY2027: ¥150/USD and ¥175/EUR.

• Company expects continued favorable performance but will monitor global trends and demand shifts.