TIS (3626) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 net sales rose 4.1% year-over-year to ¥571.7 billion, operating income up 6.9% to ¥69.0 billion, and net income attributable to owners increased 2.3% to ¥50.0 billion, driven by strong IT investment demand and digital transformation despite a decline in large development projects.

• Operating margin improved to 12.1%, with order backlog and orders received growing, especially in software development.

• Segment performance was mixed, with growth in Offering Service, Industrial IT, and Regional IT Solutions, but a decline in Financial IT due to fewer large projects.

• Extraordinary income included a ¥8.6 billion gain on sale of investment securities, while extraordinary losses included a ¥4.2 billion impairment loss.

Financial highlights

• Gross profit margin improved to 28.0% (+0.4p YoY); operating margin rose to 12.1% (+0.3p YoY).

• ROE was 15.3%, down 0.7 points year-over-year.

• All key metrics exceeded fiscal 2025 estimates, with net income 11.6% above plan.

• Cash and cash equivalents at year-end increased to ¥121.3 billion, up ¥18.6 billion from the prior year.

• Annual dividend per share increased to ¥70, with a payout ratio of 32.6%.

Outlook and guidance

• Fiscal 2026 forecasts net sales at ¥582.0 billion (+1.8%), operating income at ¥73.0 billion (+5.7%), and net income at ¥49.0 billion (-2.0%), with operating margin rising to 12.5%.

• Dividend to increase to ¥76 per share, and treasury stock repurchase of up to ¥42 billion planned.

• Focus remains on sustainable growth, high-value services, and productivity improvements under the Medium-Term Management Plan (2024-2026).

• Segment outlook: growth in Offering Service, Industrial IT, and Regional IT Solutions; continued decline in Financial IT.