CYBERDYNE,INC. FY2026 Q2 Earnings Report

Financial Highlights

• Net Sales: ¥1.96B
• Operating Income: ¥-174M
• Net Income: ¥-385M
• EPS: ¥0.33

Income Statement

Balance Sheet

Cash Flow Statement

Profitability Ratios

Year-over-Year Comparison

Share Information

Dividend Information

Disclaimer

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

AI Financial Analysis

Executive Summary

CYBERDYNE (7779) reported FY2026 Q2 (cumulative) revenue of 19.63, down 8.4% YoY, indicating top-line softness amid what appears to be a still-developing commercialization base for its technologies. Gross profit was 10.62, translating to a healthy gross margin of 54.1%, which suggests a differentiated offering and pricing power, but also points to scale constraints given the small revenue base. SG&A was 17.74 (about 90.4% of revenue), keeping the company in an operating loss of -1.74 and underscoring high fixed-cost intensity and limited operating leverage at current scale. Despite the operating loss, profit before tax was 2.97 and net income was 0.70, implying sizable positive non-operating items; these were not disclosed, which raises visibility concerns regarding the sustainability of below-the-line gains. The effective tax rate was 57.6%, unusually high relative to the pre-tax profit profile, likely reflecting valuation allowances, non-deductible items, or jurisdictional mix. EBITDA was modestly positive at 1.24 (6.3% margin), reflecting that D&A of 2.98 is a meaningful expense line for the business. DuPont analysis indicates a very low ROE of 0.2%, driven by a slim net margin of 3.6%, a very low asset turnover of 0.040, and modest leverage of 1.23x. The balance sheet remains strong with total assets of 489.14 and an equity ratio of 81.0%, implying low solvency risk. Total liabilities are 89.54, and reported debt-to-equity is 0.23x, consistent with a conservative capital structure; however, interest-bearing debt details were not disclosed. Cash and equivalents stood at 68.24, or about 14% of total assets, providing liquidity headroom despite operating losses. Operating cash flow was -0.72 and free cash flow was -8.63, with investing outflows of -7.91 (including capex of -1.85) driving most of the FCF deficit. The OCF/Net Income ratio of -1.03x signals weak earnings cash conversion this period. Working capital metrics show accounts receivable of 8.00 and inventories of 9.23 against COGS of 10.81, pointing to an inventory-heavy model relative to sales velocity. Retained earnings remain negative at -8.01, offset by a large capital surplus of 422.97, resulting in total equity of 396.12. Dividends were not disclosed; given negative FCF and modest scale, the near-term focus appears to be on funding growth and advancing commercialization. Overall, profitability remains constrained by scale and SG&A intensity, while non-operating gains temporarily support bottom-line profitability, and the balance sheet provides a cushion for continued development.

Profitability Analysis

ROE decomposition (DuPont): Net margin 3.6% x Asset turnover 0.040 x Financial leverage 1.23x = ROE ~0.2% (in line with reported). The primary constraint is extremely low asset turnover, consistent with a capital- and R&D-intensive med-tech/robotics business still scaling revenues. Gross margin of 54.1% is healthy, suggesting product and service differentiation; however, SG&A at 90.4% of revenue produces an operating margin of -8.9%, indicating insufficient scale to absorb fixed costs. EBITDA margin of 6.3% shows some cash earnings capacity before D&A, but current D&A (2.98) overwhelms this at the operating line. Operating leverage is currently negative: revenue declined 8.4% YoY while fixed cost absorption worsened, resulting in an operating loss. Profit before tax of 2.97 despite an operating loss implies approximately 4.7 of non-operating gains; sustainability is unclear given unreported detail. The effective tax rate of 57.6% further dilutes net profitability, potentially due to valuation allowance or non-deductible items. Overall profitability quality is mixed: core operations are loss-making, while bottom-line positivity this period is reliant on non-operating items.

Growth Assessment

Top-line contracted 8.4% YoY to 19.63, suggesting slower demand, timing of orders, or a pause in installations/services. Given the high gross margin, the revenue decline likely had an outsized impact on operating leverage and profitability. Profit quality is weak at the operating level; positive net income is driven by non-operating gains that are not disclosed, reducing visibility into repeatability. Without R&D disclosure, the degree of pipeline investment cannot be directly assessed, but D&A and capex indicate ongoing asset and platform build-out. Revenue sustainability will depend on conversion of pipeline into commercial contracts in rehabilitation/assistive robotics and healthcare services, and on recurring service/maintenance revenue. With inventories of 9.23 and COGS of 10.81 for the half, inventory days appear elevated, suggesting either build ahead of demand or slower turns; this could dampen near-term growth quality if not matched by sales. Short term outlook hinges on stabilizing sales, controlling SG&A, and maintaining gross margin discipline; a recovery in installations and payor acceptance would be key catalysts. Given the limited revenue base (asset turnover 0.040), even modest top-line acceleration could materially improve operating leverage, but the reverse is also true. Non-operating income will be a swing factor for reported EPS until operating profitability is established.

Financial Health

Liquidity: Cash and equivalents of 68.24 (~14% of assets) provide a buffer; current ratio and quick ratio are not calculable due to unreported current liabilities, so point-in-time liquidity cannot be precisely assessed. Working capital disclosure shows current assets of 167.58, but with current liabilities unreported, the presented working capital figure is not reliable for analysis. Solvency: Equity ratio is 81.0%, indicating a lowly leveraged balance sheet; reported debt-to-equity of 0.23x suggests conservative funding with liabilities mostly non-interest-bearing or provisions. Interest-bearing debt is unreported; interest coverage cannot be computed. Capital structure: Total equity is 396.12, supported by large capital surplus (422.97) offsetting accumulated deficits (retained earnings -8.01). This capital structure affords runway for development, but persistent operating losses would gradually erode retained earnings absent sustained non-operating gains or new equity.

Cash Flow Quality

Earnings quality is weak this period: OCF of -0.72 versus net income of 0.70 (OCF/NI = -1.03x) indicates that profits were not supported by cash generation and were likely driven by non-cash or non-operating items. Free cash flow was -8.63, as investing outflows of -7.91 (including capex -1.85) exceeded modest operating outflows. The FCF margin is approximately -44% of revenue, underscoring significant investment relative to current scale. Working capital dynamics are mixed: accounts receivable of 8.00 against six-month revenue of 19.63 implies elevated DSO, and inventories of 9.23 versus six-month COGS of 10.81 suggests high inventory days; both patterns can depress OCF if not matched by sales conversion. Depreciation and amortization of 2.98 is substantial relative to EBITDA (1.24), highlighting the non-cash component of expenses and the need to convert EBITDA to cash through better working capital control. Given positive PBT alongside negative OCF, non-operating gains appear non-cash or timing-related; absent disclosure, persistence is uncertain.

Dividend Sustainability

Dividend disclosures are unreported; payout ratio and DPS cannot be calculated. With negative free cash flow (-8.63) and operating losses, internal capacity to fund dividends appears limited in the near term. The company’s large capital surplus and strong equity ratio provide balance-sheet flexibility, but recurring cash generation is currently insufficient to support a sustainable payout without compromising growth investment. Policy outlook cannot be inferred from the data; absent clear profitability and OCF traction, a conservative stance on shareholder returns would be consistent with the company’s development stage. FCF coverage of any potential dividends would be weak given the current cash burn profile.

Risk Assessment

Business Risks:

• Commercialization risk in med-tech/robotics with slow revenue ramp (-8.4% YoY decline).
• High fixed-cost base (SG&A 90.4% of revenue) leading to negative operating leverage.
• Customer adoption and reimbursement/payor acceptance uncertainties affecting sales visibility.
• Inventory build and slower turns risking obsolescence or margin pressure.
• Dependence on non-operating gains to achieve net profitability, reducing earnings visibility.

Financial Risks:

• Negative OCF and FCF (-0.72 and -8.63) despite positive net income, indicating weak cash earnings.
• High effective tax rate (57.6%) potentially causing volatility in net results.
• Retained earnings negative (-8.01), implying limited accumulated profit buffer.
• Potential exposure to market valuation swings if non-operating income includes investment-related gains (details unreported).
• Liquidity assessment constrained by unreported current liabilities.

Key Concerns:

• Sustainability and nature of non-operating income driving PBT of 2.97.
• Path to operating breakeven given revenue contraction and high SG&A.
• Working capital efficiency (AR 8.00, inventory 9.23) and its effect on OCF.
• Visibility on interest-bearing debt and financing costs (unreported), limiting solvency analysis precision.

Investment Implications

Key Takeaways:

• Revenue declined 8.4% YoY to 19.63; scale remains the key constraint on profitability.
• Gross margin is robust at 54.1%, but SG&A intensity (90.4% of sales) drives an operating loss (-8.9% margin).
• Net income (0.70) is supported by sizable non-operating gains (PBT 2.97 vs OI -1.74); sustainability unclear.
• OCF is negative (-0.72) and FCF is deeply negative (-8.63), reflecting investment outflows and working capital drag.
• Balance sheet is strong (equity ratio 81.0%, cash 68.24), cushioning continued development.
• ROE remains minimal at 0.2% due to low asset turnover (0.040) and slim net margins.
• Effective tax rate volatility (57.6%) adds noise to bottom-line trends.
• Retained earnings are negative (-8.01), highlighting the need for consistent operating profits to rebuild equity internally.

Metrics to Watch:

• Top-line growth reacceleration and order momentum (quarterly revenue trajectory).
• SG&A control and operating leverage as scale builds (SG&A-to-sales ratio).
• Gross margin stability around 54% amid mix and pricing changes.
• Operating cash flow recovery and OCF/NI convergence toward >1.0x.
• Working capital turns: DSO and inventory days versus revenue/COGS trends.
• Nature and recurrence of non-operating income; transparency on drivers.
• Capex intensity and investment CF, and their link to future revenue.
• Cash balance versus burn rate and any updates on funding plans.

Relative Positioning: Within Japan’s med-tech/assistive robotics space, CYBERDYNE exhibits strong gross margins and a conservative balance sheet but lags peers on operating scale and cash generation, relying more on non-operating items to support net profitability; achieving sustainable operating breakeven is the central inflection point for its relative standing.

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
• At Your Own Risk: Investment decisions should be made at your own discretion and risk. We assume no liability for any losses incurred based on this analysis