Dive Inc. FY2026 Q1 Earnings Report

Financial Highlights

• Net Sales: ¥4.06B
• Operating Income: ¥418M
• Net Income: ¥277M
• EPS: ¥33.29

Income Statement

Balance Sheet

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Full Year Forecast

Disclaimer

This data was automatically extracted from XBRL files. Please refer to the original disclosure documents for accuracy.

AI Financial Analysis

Executive Summary

Dive Co., Ltd. (151A0) reported FY2026 Q1 standalone (JGAAP) results with steady topline growth and accelerating profit momentum. Revenue rose 6.9% year over year to ¥4,062 million, supported by disciplined cost control that lifted operating income by 8.9% to ¥418 million. Gross profit reached ¥1,060.7 million, translating to a gross margin of 26.1%, while operating margin improved to approximately 10.3%. Ordinary income was ¥419 million, close to operating income, indicating minimal non-operating distortions this quarter. Net income increased 13.3% to ¥277 million, pushing net margin to 6.82%, a solid conversion from revenue to bottom line. The DuPont framework shows ROE at 11.23%, decomposed into a 6.82% net margin, 0.836x asset turnover, and 1.97x financial leverage, depicting a balanced contribution from profitability and efficient asset use with moderate leverage. Liquidity remains sound with a current ratio of 177.7% and quick ratio of 177.7%, supported by ¥1,474 million in positive working capital. The capital structure is conservative to moderate with total liabilities of ¥2,167 million versus equity of ¥2,466 million, implying a debt-to-equity ratio of 0.88x and an implied equity ratio near 50.8% despite a reported 0.0% (likely an undisclosed metric in XBRL). Interest expense is negligible at ¥1.27 million, and interest coverage is robust at roughly 329x, underscoring low financing risk. The effective tax burden is more consistent with approximately 34% (¥143.8 million taxes on roughly ¥420.8 million pre-tax income) than the reported 0.0% metric, which is likely an artifact of disclosure formatting. Cash flow statement items are not disclosed for the quarter, limiting assessment of operating cash conversion and free cash flow quality. EPS was ¥33.29, but outstanding shares were not disclosed, constraining per-share capital metrics beyond EPS. Inventory was not disclosed, making working capital composition analysis incomplete; however, quick and current ratios are identical due to the non-disclosure of inventory. Dividend data show no payout in the period, consistent with a reinvestment posture or an as-yet-unannounced dividend policy. Overall, Q1 exhibits positive operating leverage and sound financial health, though a full evaluation of earnings quality awaits cash flow disclosures. These results position the company on a path of profitable growth with adequate balance sheet flexibility to fund operations and selective investment.

Profitability Analysis

ROE_decomposition:

• net_profit_margin: 6.82% (Net income ¥277m / Revenue ¥4,062m)
• asset_turnover: 0.836x (Revenue ¥4,062m / Total assets ¥4,860m)
• financial_leverage: 1.97x (Total assets ¥4,860m / Total equity ¥2,466m)
• calculated_ROE: 11.23% (matches reported)
• interpretation: ROE is driven by a balanced mix of margin and asset efficiency, with moderate leverage amplifying returns. margin_quality:
• gross_margin: 26.1% (¥1,060.7m / ¥4,062m)
• operating_margin: 10.3% (¥418m / ¥4,062m)
• ordinary_margin: 10.3% (¥419m / ¥4,062m)
• net_margin: 6.82% (¥277m / ¥4,062m)
• tax_burden_estimate: ≈34.2% (Income tax ¥143.8m / Pre-tax ≈ ¥420.8m)
• commentary: Stable gross spread and contained SG&A (≈¥642.7m, ~15.8% of revenue) support margin expansion. Minimal non-operating impact and a normalizing tax burden underpin bottom-line quality. operating_leverage:
• revenue_growth_YoY: 6.9%
• operating_income_growth_YoY: 8.9%
• implication: Positive operating leverage as OI growth outpaced revenue growth, signaling cost discipline and scale benefits.

Growth Assessment

revenue_sustainability: Topline growth of 6.9% YoY suggests steady demand. With asset turnover at 0.836x, utilization appears efficient for the current asset base, but seasonality cannot be assessed from a single quarter. profit_quality: Operating income growth (+8.9%) and net income growth (+13.3%) outpaced revenue, reflecting improving mix/efficiency. Ordinary income closely tracks operating income, indicating low reliance on non-core gains. outlook: Assuming stable demand and continued SG&A discipline, modest revenue growth with incremental margin expansion is plausible. Confirmation requires subsequent quarters and disclosure of segment drivers and any seasonal factors.

Financial Health

liquidity:

• current_ratio: 177.7% (Current assets ¥3,371.5m / Current liabilities ¥1,897.5m)
• quick_ratio: 177.7% (inventory not disclosed; quick equals current by reported data)
• working_capital: ¥1,474.0m
• interpretation: Ample short-term liquidity headroom to meet obligations and fund operating needs. solvency:
• debt_to_equity: 0.88x (Total liabilities ¥2,167.1m / Equity ¥2,466m)
• equity_ratio_implied: ≈50.8% (Equity ¥2,466m / Assets ¥4,860m), reported 0.0% likely nondisclosure artifact
• interest_coverage: ≈329x (Operating income ¥418m / Interest expense ¥1.27m)
• interpretation: Moderate leverage with strong interest coverage indicates low solvency risk and capacity for investment. capital_structure: Balanced mix of equity and liabilities with modest financial risk. Limited non-operating income suggests earnings are operationally driven.

Cash Flow Quality

earnings_quality: Absent cash flow disclosure this quarter, accruals cannot be evaluated. Nonetheless, small non-operating items and consistent tax burden support core earnings credibility. free_cash_flow_analysis: OCF and FCF are undisclosed; FCF cannot be assessed. Capex intensity is unknown due to unreported investing cash flows and depreciation. working_capital_dynamics: Receivables, payables, and inventory details are not disclosed. Reported working capital of ¥1,474m implies capacity to support growth, but cash conversion cycle assessment is not possible.

Dividend Sustainability

payout_ratio_assessment: Payout ratio shown as 0.0% with DPS at ¥0.00; implies no dividend declared for the period. With EPS at ¥33.29, capacity for dividends exists but policy is unclear. FCF_coverage: Not assessable this quarter due to undisclosed OCF/FCF. Coverage metrics cannot be computed reliably. policy_outlook: Given reinvestment signals (no payout) and growth in earnings, the company may prioritize internal investment. Future guidance or year-end policy disclosure will be key.

Risk Assessment

Business Risks:

• Revenue concentration or cyclicality risk (segment/customer mix undisclosed).
• Seasonality risk given quarterly snapshot with limited historical context.
• Competitive pressure potentially compressing gross margins if input costs rise.
• Operational execution risk in scaling while maintaining SG&A efficiency.

Financial Risks:

• Working capital swings could impact OCF; receivables/inventory not disclosed.
• Potential tax rate volatility versus estimated ~34% burden.
• Refinancing or liquidity risk appears low but contingent on maintaining current asset quality.

Key Concerns:

• Lack of cash flow disclosure prevents validation of earnings-to-cash conversion.
• Inventory and receivable details not available, limiting assessment of cash conversion cycle.
• Equity ratio reported as 0.0% conflicts with implied ~50.8%, suggesting disclosure formatting limitations.

Investment Implications

Key Takeaways:

• Solid Q1 with revenue +6.9% YoY and operating income +8.9% demonstrates positive operating leverage.
• Margins are healthy: gross 26.1%, operating ~10.3%, net 6.82%, with minimal non-operating distortion.
• ROE at 11.23% is supported by balanced DuPont drivers and moderate leverage (1.97x).
• Liquidity is strong (current ratio 177.7%) and solvency risk is low (interest coverage ~329x).
• Cash flow quality cannot be verified due to undisclosed OCF/FCF; monitoring future quarters is essential.

Metrics to Watch:

• Operating cash flow and free cash flow once disclosed.
• SG&A ratio trend (currently ~15.8% of revenue) for signs of sustained operating leverage.
• Gross margin stability amid input cost or pricing changes.
• Asset turnover and working capital days to gauge efficiency.
• Tax rate normalization versus the ~34% implied level.
• Dividend policy updates and capital allocation guidance.

Relative Positioning: Within a fundamentals context, the company exhibits above-average profitability resilience and conservative-to-moderate leverage compared to typical small-to-mid cap JGAAP filers, though limited disclosure on cash flows and working capital constrains a full quality-of-earnings assessment.

Disclaimer

This analysis was auto-generated by AI. Please note the following:

• No Guarantee of Accuracy: The accuracy and completeness of this analysis are not guaranteed. For accurate financial data, please refer to the original disclosure documents published on TDnet or other official sources
• Not Investment Advice: This analysis is for general informational purposes only and does not constitute investment advice under applicable securities laws. It is not a recommendation to buy or sell any specific securities
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