WingArc1st (4432) Q1 2027 earnings summary

Executive summary

• Achieved revenue growth of 6.7% year-over-year to ¥7,806 million and profit attributable to equity holders up 6.3% to ¥1,559 million, driven by strong recurring and cloud revenue, despite a decrease in license sales year-over-year.

• EBITDA increased 4.0% year-over-year to ¥2,565 million, reflecting improved operational efficiency and AI-driven cost reductions.

• Basic earnings per share rose to ¥44.91 from ¥42.36 in the prior year period.

• Announced a share repurchase program of up to 1.25 million shares (3.59% of outstanding shares) and a shareholder benefit program to enhance shareholder returns.

Financial highlights

• Revenue increased 6.7% year-over-year to ¥7,806 million; EBITDA margin was 32.9%.

• Profit attributable to equity holders grew 6.3% year-over-year to ¥1,559 million (margin 20.0%).

• Recurring revenue grew 17.8% year-over-year, with cloud revenue up 37.9%.

• Maintenance retention rate remained high at 90.2%.

• Net cash position improved to ¥15,321 million, with financial leverage on a downward trend.

Outlook and guidance

• Full-year revenue forecast for FY2027 is ¥34,300 million, with EBITDA at ¥12,100 million and profit at ¥7,420 million.

• Q1 progress is on track, with expectations to meet first-half and full-year forecasts.

• Annual dividend forecast is ¥108 per share, up from ¥104 in the previous year.

• On-premises license orders in Q2 expected to exceed Q1.