Trend Micro Incorporated Q4 FY2025 earnings call

Mahendra Negi mentioned fourth quarter achieved record high net sales, full year record high revenue and operating profit. Eva Chen talked about software value in GenAI era, Trend Micro's reorganization into segments like TrendAI, TrendLife, Magna AI and VicOne. TrendAI's go-to-market changes including leading with Vision One platform, adjusting incentive structure, changing to Flex program. TrendLife focusing on Digital Life Protection and auto renew. Magna AI focusing on secure AI infrastructure. Kevin Simzer updated on business performance, enterprise growth driven by Vision One platform, consumer business recovery from e-commerce provider issue, regional performance, and growth categories. Akihiko Omikawa gave Japan region business update on Enterprise and consumer segments.

Fourth quarter saw 5% revenue increase and 50% operating profit increase with 18% OP margin. Full year had record high revenue and operating profit. Cloud expenses in Vision One service expanding. ARR slowed to 2% in fourth quarter from 7% a year ago. Dividend per share expected to be JPY 185. Revenue guidance 9% increase, operating profit minus 2% for 2026. Japan region Enterprise business revenue grew 22% YOY, Trend Vision One revenue up 25%. Consumer business beyond device security sales ratio increased to 35%, Fraud Buster downloads growing.

2026 guidance: 9% revenue increase; operating profit minus 2%. ARR expected 13% growth; net sales 9% growth. TrendAI aiming for around 8% compounded annual growth rate. TrendLife targeting 6% ARR growth. Hypergrowth areas requiring investment. 2028 plan for healthy high single digits to double-digit growth while improving margin.

Q: Consumer performance guidance and ARR growth pace; A: No quarter-by-quarter ARR outlook provided, Kevin's slides are management numbers.

Q: Sales growth slower impact on operating profit; A: Focus on sales growth, prioritize sales growth this year.

Q: Share buyback and shareholder return; A: 100% shareholder return with 70% dividend and share buyback.

Q: ARR quarter-based growth and regional breakdown; A: Gradual increase in ARR over the year, Europe, Asia expected to grow first then U.S. to catch up.

Q: Magna loss and nonoperating items; A: Magna included in operating profit and loss, nonoperating items mainly loss from investment and small interest income.

Q: Share buyback policy change; A: Policy not changed, appropriate timing for share buyback.

Q: Legacy SaaS unwinding and new acquisition; A: Tracking Vision One ARR contribution, end-of-life of legacy SaaS licenses to drive movement in 2026