TIS (3626) Q3 2025 earnings summary

Executive summary

• Net sales for the first nine months of FY2025 rose 2.9% year-over-year to ¥416,561 million, with operating income up 2.7% to ¥48,884 million and net income attributable to owners up 7.1% to ¥34,474 million, driven by business expansion and strong IT investment demand, especially in digital transformation.

• Growth was supported by the launch of a new three-year Medium-Term Management Plan targeting sustainable growth and higher added value.

• Operating margin remained stable despite a decline in large-scale project activity and increased unprofitable projects.

• Orders received and order backlog increased year-over-year, with robust growth in software development.

• Extraordinary income included a ¥5,787 million gain on sales of investment securities and extraordinary losses included impairment loss and loss on valuation of shares in subsidiaries.

Financial highlights

• Net sales rose to ¥416,561 million (+2.9% YoY), operating income reached ¥48,884 million (+2.7% YoY), and net income attributable to owners was ¥34,474 million (+7.1% YoY).

• Gross profit margin improved to 27.8% (+0.3pt YoY), and operating margin was 11.7% (down 0.1pt YoY).

• Comprehensive income for the period was ¥41,481 million, up 7.8% year-over-year.

• Basic earnings per share increased to ¥148.13 from ¥133.53 year-over-year.

• Total assets as of December 31, 2024, were ¥521,741 million, with net assets at ¥341,337 million and an equity ratio of 63.1%.

Outlook and guidance

• Full-year performance is progressing in line with estimates; no change from previous forecasts.

• FY2025 full-year forecast: net sales of ¥555,000 million (+1.1% YoY), operating income of ¥66,500 million (+3.0%), and net income attributable to owners of ¥44,800 million (-8.3%).

• Decrease in net income forecast due to lower non-operating and extraordinary income compared to prior year.

• No changes to the previously announced earnings or dividend forecasts; total return ratio targeted at 50%.

• Management expects sustainable growth through high-value businesses and productivity enhancements, despite the end of large-scale development projects.