Quick View
| Metric | Current Period | Previous Year Period | YoY |
|---|---|---|---|
| Revenue | ¥44.4B | ¥43.0B | +3.1% |
| Operating Income | −¥0.4B | −¥0.9B | +57.6% |
| Ordinary Income | −¥0.8B | −¥1.2B | +37.9% |
| Net Income | −¥0.7B | −¥1.3B | +46.9% |
| ROE (Annualized) | 146.2% | 24.6% | - |
Executive Summary
Although Revenue increased, the profitability of the core business remained in the red, and the Company did not achieve profitability. Revenue was ¥44.4B (+3.1% YoY), Operating Income was ¥-0.4B (loss narrowed from ¥-0.9B in the previous year), Ordinary Income was ¥-0.8B (¥-1.2B in the previous year), and Net Income was ¥-0.7B (¥-1.3B in the previous year). The primary drivers of revenue growth were the Casual Wedding Business and the Regional Revitalization/QOL Business, while the reduction in losses was mainly attributable to improved SG&A efficiency. Meanwhile, the stagnation of the matchmaking business and the downward revision to the FY2026 forecast in February 2026, including the recognition of impairment losses, indicate the need for future reforms to the earnings structure.
Factors Affecting Performance
【Revenue】Revenue was ¥44.4B, an increase of +3.1% YoY. While the Casual Wedding Business grew to ¥26.3B (+6.8%) and the Regional Revitalization/QOL Business grew to ¥3.7B (+38.1%), the Matchmaking Business declined to ¥14.6B (-8.4%), reflecting the impact of the downward revision to the number of new members. The main driver of revenue growth was the effect of introducing and raising service fees in the Casual Wedding Business.
【Profit and Loss】Operating Loss narrowed to ¥0.4B from ¥0.9B in the previous year period. Although the gross profit margin declined slightly YoY to 68.1%, the SG&A ratio improved to 69.0%, becoming the primary factor behind the reduction in losses. Ordinary Loss of ¥0.8B resulted from adding ¥0.4B in interest expense to Operating Loss, while interest income remained minimal at ¥0.0B. Net Loss was ¥0.7B after recognizing ¥0.1B in extraordinary income. However, the full-year forecast is expected to incorporate approximately ¥2.3B in impairment losses for the Matchmaking Business and approximately ¥0.4B in projected impairment losses related to the head office relocation as extraordinary losses; these should be distinguished as temporary factors. In conclusion, the Company is in a phase of increased revenue and narrowing losses (an improvement from a situation of increased revenue and decreased profit), but it has not yet achieved operating profitability.
Segment Analysis
The largest segment by composition is the Casual Wedding Business, with Revenue of ¥26.3B (59.2% of total), Operating Income of ¥1.8B, and a profit margin of 6.8%, making it the core business. The segment posted a +6.8% YoY increase in Revenue, while Operating Income improved by more than +¥1.9B, making it the primary factor behind the improvement in performance. The Matchmaking Business recorded Revenue of ¥14.6B (32.9% composition ratio), Operating Income of ¥0.9B, and a profit margin of 6.0%; it experienced declines in both Revenue and profit YoY and weighed on overall performance. Although the Regional Revitalization/QOL Business is small in scale, with Revenue of ¥3.7B (8.3% composition ratio), it had the highest profit margin at 19.5%, reflecting the successful expansion of contracts with local governments. The high profitability of the Regional Revitalization/QOL Business contrasts with the scale effects of the Casual Wedding Business across the segments, while declining profitability in the Matchmaking Business remains a burden on overall results.
Key Financial Indicators
Profitability: Operating Profit Margin of -0.9% (previous year: -2.1%), Net Profit Margin of -1.5% (previous year: -3.0%)
Equity Ratio: -1.6% (previous year: -19.4%); negative net worth continues, although the deficit has narrowed
ROE (Annualized): 146.2%, but this figure results from the combination of Net Loss and negative net assets and does not indicate high capital efficiency
EPS: -¥2.34 (previous year: -¥4.87)
Cash Flow Analysis
As individual disclosures for Operating Cash Flow, Investing Cash Flow, and Financing Cash Flow are not included in the data, FCF has not been calculated. Cash and deposits increased +27.4% YoY to ¥17.5B, presumably mainly due to increases in stated capital and capital surplus (capital raising). With Operating Income remaining negative, the cash backing of earnings is considered limited, and the situation requires monitoring.
Earnings Quality
Ordinary Loss of ¥0.8B resulted from adding ¥0.4B in interest expense to Operating Loss of ¥0.4B, with the gap between the two primarily attributable to financial expenses. Non-operating income was nearly zero, while non-operating expenses, mainly interest expense, accounted for approximately 0.9% of Revenue. Extraordinary income of ¥0.1B was a temporary factor. The difference between Net Loss of ¥0.7B and Ordinary Loss of ¥0.8B was attributable to the boost from extraordinary income and does not indicate an improvement in recurring earning power.
Earnings Forecast and Guidance
The full-year forecast was revised downward on February 6, 2026, with Revenue of ¥60.0B (△4.8% versus the initial plan, +1.5% versus the previous fiscal year), Operating Income of ¥0.6B (△77.7% versus the initial plan), and expected Net Loss of ¥2.5B. Nine-month cumulative Revenue of ¥44.4B represents a 74.0% progress rate against the full-year forecast, slightly below the standard progress rate of 75%. Since the nine-month cumulative Operating Income is a loss, a progress rate cannot be calculated, and approximately ¥1.0B in profit will be required in Q4. The primary reasons for the revision were weak new-member acquisition in the Matchmaking Business and declining demand for wedding after-parties in the Casual Wedding Business. In addition, incorporating approximately ¥2.3B in impairment losses for the Matchmaking Business and approximately ¥0.4B for the head office relocation as extraordinary losses has significantly reduced the forecast for Net Loss.
Shareholder Returns
The Q2 dividend was ¥0 per share, and the full-year forecast dividend is also ¥0, continuing the suspension of dividends. In light of the continued recognition of Net Loss and negative net worth, the Payout Ratio is not applicable. No share repurchases have been confirmed, and the Total Return Ratio is also not applicable.
Catalysts
【Short Term】Whether the Company achieves Operating Profit in Q4 and the final amounts of impairment losses related to the Matchmaking Business and head office relocation.
【Long Term】Progress in reforms to the earnings structure under the new management framework established in February 2026, including the appointment of outside directors from the AI Fusion Capital Group and IBJ, as well as the recovery of customer acquisition capacity in the Matchmaking Business.
Industry Benchmark (For Reference; Compiled by the Company)
Industry Benchmark (it_telecom)
Profitability and Returns
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Operating Profit Margin | −0.9% | 8.3% (3.6%–18.6%) | −9.2pt |
| Net Profit Margin | −1.5% | 6.1% (2.3%–12.8%) | −7.7pt |
The Company's profitability is significantly below the industry median and ranks near the bottom of an industry primarily composed of profitable companies.
Growth and Capital Efficiency
| Metric | Company | Median (IQR) | Delta |
|---|---|---|---|
| Revenue Growth Rate (YoY) | 3.1% | 10.4% (-0.9%–19.9%) | −7.3pt |
The Revenue growth rate is also below the industry median, and the pace of revenue growth is relatively modest within the industry.
※Source: Compiled by the Company
Risk Factors
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Declining profitability in the Matchmaking Business: Revenue deteriorated to ¥14.6B (△8.4% YoY), while Operating Income declined to ¥0.9B (△66.8%). This was attributable to the downward revision in the number of new members from the initial plan of 5,256 to 3,000, making the recovery of customer acquisition capacity a key challenge.
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Financial soundness risk: Net assets were ¥-0.6B, and negative net worth continues. Interest expense of ¥0.4B was incurred against interest-bearing debt of ¥23.5B, leaving the Company unable to absorb its interest burden without achieving Operating Income profitability.
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Recognition of impairment losses: The full-year forecast includes approximately ¥2.3B in impairment losses for the Matchmaking Business and approximately ¥0.4B in impairment losses related to the head office relocation as extraordinary losses. Net Loss may expand further depending on the final amounts.
Key Points in the Earnings Results
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Operating Loss narrowed from ¥0.9B in the previous year period to ¥0.4B due to higher Revenue and improved SG&A efficiency. However, the gross profit margin declined slightly, indicating that the improvement in profit was primarily attributable to the absorption of fixed costs.
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The Company has indicated that it intends to pursue a turnaround of the Matchmaking Business and reforms to its earnings structure, triggered by the transition to a new management framework in February 2026 and the capital and business alliance with the AI Fusion Capital Group and IBJ.
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The full-year forecast was revised downward. Although Operating Income is expected to turn profitable, Net Loss is projected to expand to ¥2.5B due to the recognition of impairment losses. Accordingly, recurring earning power and temporary losses should be distinguished when evaluating the quality of earnings.
This report is an earnings analysis document automatically generated by AI through an integrated analysis of XBRL earnings release data and PDF earnings presentation materials. It does not constitute a recommendation to invest in any specific security. The industry benchmarks are reference information compiled by the Company based on publicly available earnings data. Investment decisions should be made at your own responsibility, and you should consult a professional advisor as necessary.
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