7039.T

• Company Overview & Business Model

  • Bridge International Group supports sales growth transformation for B2B companies across three core business lines: Inside Sales Outsourcing (core, legacy, stock-based stable revenue model), Process & Technology (applies generative AI to sales and marketing to support client growth), and Training (supports client talent development for successful transformation).
  • The inside sales outsourcing model focuses on process division: Bridge leads prospect discovery, relationship building, and nurturing up to the initiation of client consideration, then passes full activity history to the client's sales team for proposal and closing. The top 10 clients have an average annual revenue of over 250 million yen (0.25 billion yen), account for just under 60% of total segment revenue, and have an average contract tenure exceeding 9 years, demonstrating high business stability. Top clients include global large IT firms, domestic telecom carriers, and now large financial institutions.
  • The company creates synergy across its three business lines to build a strong customer base, then drives upsell and cross-sell growth from the existing base.

• 2025/12 Term Consolidated Operational Summary

  • Consolidated revenue reached 99.4% of the prior year level, a slight decline driven by the sale of Total Support (acquired via M&A in 2024) completed by the end of September 2025. The divestment removed approximately 300 million yen (0.3 billion yen) of Q4 revenue that was recorded in the prior year.
  • Operating profit reached just under 92% of the prior year level, impacted by the Total Support sale and a 100 million yen (0.1 billion yen) one-time cost from the group's transition to a holding company structure effective October 1, 2025. Total operating profit declined by just under 80 million yen (0.08 billion yen) year-over-year.
  • Recurring profit declined further year-over-year due to the absence of a 50 million yen (0.05 billion yen) insurance refund from Total Support that was recorded in the prior year. Net income came in just above 80% of the prior year level, including a 20 million yen (0.02 billion yen) impairment loss on the Total Support sale and just under 40 million yen (0.04 billion yen) in costs from disposing of unnecessary assets during the holding company transition.
  • The Total Support divestment was a strategic decision: the company acquired Total Support for its network solutions business, but growth slowed more than expected, and the company chose to reallocate resources to the fast-growing generative AI opportunity.

• Strategic Business Adjustments

  • Inside Sales Outsourcing: The business is strategically shifting focus from accumulating small projects to large-scale projects from major IT and financial institutions, to address manager/Supervisor capacity constraints. Large-scale projects generate approximately 100 million yen (0.1 billion yen) in annual revenue (vs 30 million yen/0.03 billion yen for small projects) and allow one Supervisor to manage more staff, improving profitability even with limited Supervisor headcount. The shift will take time to impact results, but positions the business for long-term growth. The company is also investing heavily in AI to automate historically manual work, improving productivity, building knowledge asset sharing systems, recommending conversation approaches to end clients, and automating analytical work previously done by management.
  • Process & Technology: After divesting Total Support, the business is refocused on its core Salesforce CRM business (which accounts for over half of segment revenue) and development of packaged AI-powered offerings across marketing, inside sales, field sales, and customer success processes. The company will target in-house client teams and clients using other vendors, with use cases including automated personalized email sending in marketing and automatic daily report registration for sales teams, to improve client operational efficiency. The business will leverage its long-standing Salesforce partner base and existing customer relationships to expand this offering.
  • Training: The business is structured around three core offerings: new hire training (50% of revenue, seasonal peak in Q2), custom training (23% of revenue), and open enrollment training. New hire training, which is supported by dedicated manager assignments and hand-on support, will continue to be expanded as a core growth driver. Custom training will shift focus to high-demand Project Management (PM) and sales-focused training: PM training leverages legacy know-how from former IBM Japan's training unit, aligned with strong market demand for PM skills amid digital transformation and volatile market conditions, while sales training leverages the company's core inside sales expertise. The business will implement partial price increases in April 2026 to improve profitability.

• Consolidated 2026/12 Term Guidance

  • Consolidated revenue is guided to a range of 8.2 billion yen to just under 9.2 billion yen. Excluding the divested Total Support business, this represents 6.2% to 17.4% year-over-year growth, a target double-digit growth. Operating profit is guided to 13.8% to 25.8% year-over-year growth (excluding Total Support), representing a significant increase in profit. Full-year dividend is planned to increase from 85 yen to 95 yen, an 11.8% increase, maintaining a payout ratio of 50% or higher, strengthening shareholder returns.
  • Quarterly revenue outlook: Q1 (Jan-Mar) revenue is expected to show almost no growth, as large-scale inside sales projects take longer to close, pushing revenue recognition into later quarters. Q2 (Apr-Jun) is guided to 10% year-over-year growth, Q3 (Jul-Sep) to 17% growth, and Q4 (Oct-Dec) to 18% growth, as accumulated stock revenue gradually impacts results.
  • Quarterly operating profit outlook: Q1 profit is guided to approximately half of the prior year level, driven by large salary increases to improve employee retention and motivation, plus sharply higher hiring costs for expanded staffing on large projects. Q2 to Q4 will see rising profit levels, with no 100 million yen one-time holding company transition cost recorded in 2025, so the second half of the year is expected to deliver stable profit.

• Segment 2026/12 Term Guidance

  • Inside Sales Outsourcing: Revenue is guided to 4.9 billion yen (lower bound) to 5.4 billion yen (upper bound), representing 6.1% to 17.3% year-over-year growth from 2025's 4.6 billion yen. Segment operating profit is guided to 928 million yen (lower bound) to over 1 billion yen (upper bound), from 562 million yen in 2025. The segment profit margin is expected to hold at 12% (the same as 2025), with an adjusted profit margin of 18.9% under a new calculation methodology. The target segment profit margin for the full business is 19%.
  • Process & Technology (excluding Total Support): Revenue is guided to 855 million yen to 945 million yen, representing 7.5% to 18.8% year-over-year growth from 2025's 795 million yen. Segment profit is guided to 147 million yen to 162 million yen, representing over 93.4% to over 100% year-over-year growth from 2025's 76 million yen. The target segment profit margin is 17%.
  • Training: Revenue is guided to 5.4% to 16.5% year-over-year growth. Profit is guided to 326 million yen to 361 million yen, representing 23.4% to 36.7% year-over-year growth from 2025's 264 million yen. The target segment profit margin is 13%.

1. Inside Sales Outsourcing Business: This is the company's core business, accounting for over 50% of total revenue. For the 2025/12 term, revenue increased year-over-year, but segment profit came in at 83% of the prior year level. A one-time holding company transition cost of 85 million yen (0.85 billion yen) impacted this segment, leading to a slight profit decline. 2024/12 term revenue was 4.6 billion yen.
2. Process & Technology Business: This segment included the divested Total Support company. Total revenue for 2025/12 fell below 90% of the prior year level due to the absence of Total Support's Q4 revenue. Excluding Total Support, the remaining business achieved rapid profit improvement, reaching 92 million yen (0.092 billion yen) in profit, with significantly improved profitability. 2025/12 revenue excluding Total Support was 795 million yen (0.795 billion yen), with segment profit excluding Total Support of 76 million yen (0.076 billion yen).
3. Training Business: New hire training growth was solid, driving a 4% year-over-year revenue increase for the 2025/12 term. As part of holding company transition asset processing, the business expensed 24 million yen (0.024 billion yen) for obsolete software to prepare for the next fiscal year, impacting full-year profit. 2025/12 segment profit was 264 million yen (0.264 billion yen).

• Manager/Supervisor capacity constraint: The inside sales outsourcing business relies on high-quality managers/Supervisors to manage teams, and the availability of qualified supervisors is becoming increasingly constrained, which could limit growth if the shift to large-scale projects does not improve capacity utilization as expected.
  • Large project closing delay risk: The strategic shift to large-scale clients and projects means closing and launch takes longer than small projects, which can push near-term revenue and profit recognition into later periods, creating short-term earnings volatility as seen in the 2025/12 term.
  • Labor cost inflation: As a labor-intensive business, rising wages and hiring costs to retain talent and expand capacity for large projects create near-term margin pressure, particularly in Q1 2026/12.

Q: Consolidated revenue came in at 99.4% of prior year, operating profit at 91.9% of prior year. Can you summarize the full fiscal year performance?

A: The 99.4% revenue result came from the divestment of subsidiary Total Support, which was removed from the consolidation from Q4 onward. Excluding Total Support, all businesses achieved stable revenue growth. For profit, the transition to a holding company structure on October 1, 2025 led to higher outsourcing costs for structure setup, a change in social insurance contribution accrual timing, higher system and license costs, and expenses from the cleanup of unnecessary assets to improve future profitability. These factors led to the 91.9% year-over-year profit result. Most of these holding company transition costs are one-time, and the impact on the 2026/12 term is expected to be minimal.

Q: Inside Sales Outsourcing revenue was 102.3% of prior year, but segment profit was only 83.4% of prior year, which looks like slowed growth. What is the actual situation?

A: Starting in Q4, we shifted focus strategically to acquiring large projects from major IT and financial industry clients to expand our medium-to-long term profit base. These large projects required longer than expected for sales activity and launch, leading to lower profit recognition than planned in this fiscal year. For segment profit, in addition to higher cost burdens from the holding company transition, we also paid special bonuses to strengthen the management team and implement employee retention initiatives, leading to the 83.4% year-over-year profit result. We view these costs as one-time base preparation and human capital investment for re-growth starting in 2026, and they are within the scope of our initial plan.

Q: Inside Sales Outsourcing is a labor-intensive business, so addressing labor shortages and inflation is important. What is your approach?

A: Client companies continue to face labor shortages, so demand for our outsourcing services continues to expand. In this environment, we made the decision to shift focus to acquiring large projects from major IT and financial industry clients to improve efficiency and profitability. We are also revising our organizational structure: instead of having one Supervisor manage multiple small parallel projects, we are building a structure focused on large-scale projects to accelerate launch and expansion and improve productivity. We are also implementing AI and other technology into inside sales activities to achieve both higher added value and greater operational efficiency, driving higher productivity per employee.

Q: The profitability of consulting and system solutions in Process & Technology Business has improved significantly. What are the drivers?

A: We implemented appropriate staffing allocation for our existing core Salesforce-focused CRM development business to optimize utilization rates. As a result, we significantly reduced outsourcing costs, which led to the profitability improvement. Going forward, we will further strengthen the profit base of the Salesforce business, and refine our structure to focus on expanding AI-powered sales growth support services, our identified growth area.

Q: What is the breakdown of the 100 million yen (0.1 billion yen) cost for the transition to the holding company structure?

A: The cost breakdown is: 45 million yen (0.045 billion yen) in outsourcing fees, 33 million yen (0.033 billion yen) from the change in social insurance contribution accrual timing, 12 million yen (0.012 billion yen) for various licenses and maintenance fees, and 5 million yen (0.005 billion yen) in other costs. Outsourcing fees are primarily payments to lawyers, judicial scriveners, and accounting firms for the corporate split. License and maintenance fees are incremental costs from launching new system usage at each company after the split. Other costs are primarily consumables such as greeting cards, business cards, and seals for the structural change. Most of these costs are one-time, and the impact on the 2026/12 term is expected to be minimal.