WingArc1st (4432) Q4 2026 earnings summary

Executive summary

• Achieved record-high revenue and profits in FY2026, with revenue rising 7.8% year-over-year to ¥30,945 million and profit attributable to equity holders increasing 9.6% to ¥6,500 million; strong Q4 performance in licenses and recurring revenue contributed significantly.

• Profit margins improved year-over-year due to effective cost management, despite temporary declines from M&A activities.

• Cloud and subscription services grew over 30% sequentially from the previous quarter, driven by SVF Cloud and Dr.Sum Cloud.

• Total comprehensive income surged 62.7% year-over-year to ¥8,916 million, reflecting strong gains in other comprehensive income.

• Profit figures exceeded forecasts, even though revenue was slightly below expectations.

Financial highlights

• FY2026 revenue: ¥30,945 million, up 7.8% year-over-year; EBITDA: ¥10,526 million, up 9.1%; profit attributable to equity holders: ¥6,500 million, up 9.6%.

• EBITDA margin improved to 34.0% (up 0.4pt YoY); profit margin rose to 21.0% (up 0.4pt YoY); operating profit up 9.4% to ¥8,989 million.

• Recurring revenue increased 16% YoY, with recurring ratio at 65.6% and maintenance retention rate at 93.4%.

• Cloud services revenue grew 34.9% YoY, with SVF Cloud up 28.5% and Dr.Sum Cloud up 34.4%.

• Basic earnings per share rose to ¥187.57 from ¥171.97 year-over-year.

Outlook and guidance

• FY2027 revenue forecast: ¥34,300 million (+10.8% YoY); EBITDA: ¥12,100 million (+14.9% YoY); profit: ¥7,420 million (+14.2% YoY); operating profit up 17.9% to ¥10,600 million.

• Both BDS and DE segments expected to see double-digit growth; profit margins projected to improve further.

• Dividend per share for FY2027 forecast at ¥108, up ¥4 from previous year, with a payout ratio of 50.6%.

• Medium-term targets: cloud growth rate 40%, recurring ratio 75%, EBITDA ¥12 billion by FY2027.

• Profit attributable to equity holders is projected to rise 14.2% to ¥7,420 million.