WingArc1st (4432) Q2 2026 earnings summary

Executive summary

• Revenue for the six months ended August 31, 2025, was ¥14,712 million, a 1.1% decrease year-over-year, mainly due to a significant drop in on-premises license sales and increased labor costs, but recurring revenue grew strongly, driven by cloud services and the consolidation of WingArcNEX.

• Operating profit declined 17.2% year-over-year to ¥4,108 million, and profit attributable to equity holders fell 18.3% to ¥2,938 million.

• Comprehensive income rose 24.1% to ¥4,567 million, driven by gains in financial assets measured at fair value.

• The company launched the Trustee digital trust service, enhanced invoiceAgent functionality, and introduced DIRECTOR Cockpit in partnership with CIMTOPS.

• Awards included first place in customer satisfaction for data analysis software and an upgrade to AA in MSCI ESG ratings.

Financial highlights

• EBITDA for FY2026 Q2 was ¥4,856 million, down 14.3% year-over-year; EBITDA margin fell to 33.0% (down 5.1 points).

• Profit margin declined to 20.0% (down 4.2 points); basic earnings per share decreased to ¥84.84 from ¥104.43.

• Recurring revenue increased by 12.9% year-over-year, with cloud revenue up 23.3% and subscriptions up 37.8%.

• Maintenance retention rate improved to 93.1%.

• Total assets increased to ¥71,981 million, and equity attributable to equity holders rose to ¥44,339 million with an equity ratio of 61.6%.

Outlook and guidance

• No change to the full-year forecast: revenue ¥31,200 million, EBITDA ¥10,460 million, profit ¥6,400 million, with revenue and profit both expected to rise.

• Operating profit is projected at ¥8,950 million, an 8.9% increase.

• Dividend forecast maintained at ¥104.0 per share for FY2026, with an interim dividend of ¥52.