9416.T

• Overall Consolidated Performance

  • Consolidated revenue grew from 35.528 billion yen to 39.012 billion yen, and consolidated operating profit grew from 5.365 billion yen to 6.465 billion yen, with both revenue and profit reaching record highs across all segments. The three new growth pillars (New York expansion, World eSIM, accounting BPO services) absorbed all upfront investment and generated a combined 1.274 billion yen in revenue.
  • Company-wide stock revenue grew to 2.68 billion yen, 290 million yen above plan, driven by steady stock accumulation across both Global WiFi and Information and Telecommunications Services segments.

• Global WiFi Business Operational Highlights

  • Outbound international traveler volumes recovered to only 73.4% of 2019 levels, with weak overall market growth, driven by yen acceleration reducing personal outbound travel while corporate travel demand increased. The company shifted focus to high-ARPU corporate clients rather than stagnant personal demand, delivering growth despite overall market contraction.
  • Inbound travel demand expanded faster than expected to 133.9% of 2019 levels, with the company strengthening sales of NINJA WiFi and SIM cards, and developing new installed WiFi products for hotel placement to expand customer touchpoints.
  • Total annual usage recovered to 2.72 million cases (from 2.83 million pre-COVID), with revenue growing 3.3 billion yen from 2019 levels to 21.011 billion yen, driven by higher-margin corporate clients. By Q4 FY2025, corporate clients accounted for 64.2% of total usage (up from 56.6% in Q4 FY2024) and 75.2% of total revenue (up from 70% in Q4 FY2024). Repeat rate increased to 68.2% on a usage basis and 70.4% on a revenue basis.
  • Corporate bulk billing registered companies grew to over 72,000, with Global WiFi for Biz registered companies at 13,434. 82% of corporate clients use the unlimited plan, and 30% of domestic listed Japanese companies already use the company's services, leaving significant room for further growth.
  • World eSIM grew 2.5x year-over-year, with Q4 FY2025 revenue exceeding the normally busier Q3, and repeat rate rising to 43.6%. Annual revenue exceeded 1 billion yen for the first time, with growing non-Japanese user adoption. World eSIM is already profitable, with only New York upfront investment weighing on segment profit currently.

• Information and Telecommunications Services Business Operational Highlights

  • The segment continues to prioritize growing in-house stock services, delivering steady revenue growth while increasing customer lifetime value. 300 million yen in upfront investment was allocated to accounting BPO services, which weighed on reported profit, but organic profit grew as planned when excluding this investment, leaving significant room for future growth.
  • The segment's product portfolio has evolved from traditional fixed telephone lines to smartphones, electricity-related services, and copiers, with a diversified portfolio that reduces reliance on any single product and creates cross-selling opportunities. Long-term customer relationships have resulted in a very low churn rate, with the business proven resilient through past market shocks including the Great East Japan Earthquake and the 2008 Global Financial Crisis.

• Glamping & Tourism Business Operational Highlights

  • The two existing facilities (Yamanakako and Koshikano Onsen) maintain high utilization, with current room count considered optimal (weekends are consistently fully booked). A new facility on Awaji Island is scheduled to open in early 2027.
  • Revenue growth is driven primarily by inbound tourism, with the company focusing on high-value European and American markets (longer stays, higher spending) rather than the hyper-competitive low-margin Asian market. The company uses the same direct one-on-one partner development strategy built in the Global WiFi business, targeting less competitive niches to drive sustainable growth.

• Group Company Highlights

  • Adoval Inc., acquired via M&A, has seen revenue double since acquisition, with its Grade Park series of event spaces all located in prime near-station locations in Tokyo. The business is still in an upfront investment phase but is delivering strong profit growth.
  • Alpha Techno, which joined the group in 2018, currently generates 1.663 billion yen in revenue and over 0.1 billion yen in operating profit. It has successfully leveraged group synergies to launch digital lead generation for office services, deliver one-stop solutions for Vision customers, and grow steadily.

• FY2026 (December 2026) Guidance: Revenue is projected at 42 billion yen, operating profit at 7.5 billion yen, EBITDA at 8.448 billion yen, and net income at 5.1 billion yen. This guidance maintains the original operating profit target despite a downward revision to revenue projections, driven by a continued shift to high-ARPU corporate clients.
• Medium-Term Management Plan (2026-2028) Revision:
  • The plan was revised to incorporate a slower recovery assumption for outbound international traveler volumes: projected recovery of 75% of 2019 levels in 2026, 77.5% in 2027, and 80% in 2028. This resulted in a downward revision of revenue projections from the original plan: 48 billion yen → 42 billion yen for 2026, 55.6 billion yen → 45.5 billion yen for 2027, 63.4 billion yen → 50 billion yen for 2028.
  • The original operating profit targets are fully maintained: 7.5 billion yen for 2026, 8.7 billion yen for 2027, and 10 billion yen for 2028. The company expects annual 700 million yen in incremental stock revenue growth to offset slower personal travel recovery, and targets improving operating margin to over 20% by 2028 (from 17.9% in 2026 to 19.1% in 2027). ROE is projected to remain above 20% at 23% (2026), 23.6% (2027), and 23.9% (2028).
  • Company-wide stock gross profit is projected to grow from 2.68 billion yen (FY2025) to 3.23 billion yen (FY2026), 3.92 billion yen (FY2027), and 4.67 billion yen (FY2028).
• Dividend Guidance: The company maintains a 50% payout ratio target, and added a DOE 8% target as a secondary guideline for flexibility amid market changes. For FY2025, a total annual dividend of 51 yen per share is planned (22 yen interim, 29 yen year-end), representing a 6 yen increase to the regular dividend from the prior year. The 50% payout ratio target is confirmed for 2026 and 2027, even with continued active investment and M&A.
• Cash Allocation (2026-2028): Total cumulative net income from operating profit is projected at 17.8 billion yen over the three years. Approximately 8.9 billion yen is allocated to growth investment (human capital and M&A), with any unused portion allocated to share repurchases and cancellation. The remaining 8.9 billion yen is allocated to shareholder returns via dividends. The company holds approximately 10 billion yen in cash after tax and dividend payments as a buffer against market shocks, sufficient to cover 2-3 months of operating needs in a crisis.

1. Global WiFi Business: Revenue grew from 19.875 billion yen to 21.011 billion yen, and segment profit grew from 5.987 billion yen to 6.351 billion yen. Revenue contribution share is approximately 53.9% of total consolidated revenue. 2. Information and Telecommunications Services Business: Revenue grew from 14.49 billion yen to 16.406 billion yen, and segment profit grew from 1.693 billion yen to 1.746 billion yen. Revenue contribution share is approximately 42.1% of total consolidated revenue. 3. Glamping & Tourism Business: Revenue grew from 1.155 billion yen to 1.588 billion yen, and segment profit grew from 0.119 billion yen to 0.176 billion yen. Revenue contribution share is approximately 4.1% of total consolidated revenue. All three segments achieved record high profit in FY2025.

• Overall outbound international travel demand remains well below pre-COVID levels, and yen appreciation/depreciation volatility continues to pressure personal travel demand, which could impact top-line growth if corporate client growth fails to offset the decline.
  • Currency exchange rate volatility impacts the cost of global WiFi roaming services, and the company can only hedge a portion of exposure via forward contracts, leaving unhedged exposure to rate movements.
  • SaaS IT M&A targets carry inherent risk related to AI industry trends and engineer hiring challenges, with a larger gap in available engineering talent between Japan and the US that could create delayed negative impacts on acquired businesses.
  • Excessive goodwill from overpriced M&A could damage earnings if targets fail to meet growth projections, so the company avoids such deals unless clear significant upside is confirmed.
  • Personal travel recovery is uncertain, and slower than expected recovery could require further downward adjustment to revenue projections even as operating profit remains supported by corporate growth.

Q1: The medium-term plan was revised to use a more conservative assumption for international travel recovery, but operating profit was kept unchanged. What is the context for the 75% recovery assumption for FY2026, and can you confirm if there is upside to profit if travel recovers faster than expected? Is the current plan a firm commitment?

A: The 75% recovery assumption is only a minor improvement from FY2025's 73.4%, and most of the change in the underlying business is the ongoing shift in the mix to higher corporate penetration, not a change in overall travel volume. If overall travel volumes increase faster than expected, there is clear upside to profit above the current plan. The company's top priority is continuing to increase corporate penetration, which is the key to long-term success in this market given the low current passport ownership rate in Japan; companies focused purely on personal travel may struggle to survive. The FY2026 7.5 billion yen operating profit target is achievable at the current cruising pace of corporate growth, and upside from faster travel recovery would be allocated to additional long-term growth investment, which aligns with the goal of balancing profit generation and growth investment. Inbound travel is also expected to grow slightly, but it will not have a large impact on profit as no major additional marketing spend is planned.

Q2: On cash allocation, if there are no M&A opportunities for an extended period through 2028, will share repurchases be implemented? Will the company be flexible to repurchase shares if the stock price declines significantly?

A: The company will remain conscious of the share price, and will implement share repurchases flexibly if the share price is judged to be inexpensive. There is zero chance that the company would hold excess cash for three full years without repurchasing if no M&A opportunities arise. The company will evaluate the situation at each quarterly reporting period, and will act accordingly, so shareholders should expect flexibility on this point.

Q3: What is the seasonal pattern for quarterly sales and profit in FY2026? Are there any specific quarters that investors should watch for uneven performance?

A: There are no material changes to the seasonal pattern from last year, and performance will follow the historical pattern.

Q4: What is the company's M&A strategy, target sectors, and current progress? Are there any near-term pending deals? What investment discipline does the company follow?

A: The company cannot comment on pending deals due to insider trading rules, but confirms it will continue to pursue M&A actively. The primary focus is on targets that complement gaps in the Information and Telecommunications Services business and create clear synergies, including roll-up opportunities where existing solid customer bases can be leveraged for cross-selling. For SaaS IT targets, the company is proceeding cautiously to assess risks related to AI trends and engineer hiring, as there are structural differences in engineer availability between Japan and the US that create latent risks. The company evaluates both labor-intensive and high-technology targets, and prioritizes deals that add capabilities to the existing business rather than starting new businesses from scratch. For the Global WiFi business, the company is one of the most profitable and largest players globally, and receives many inbound inquiries, so will consider roll-up opportunities that align with strategy. On investment discipline, the company does not insist on 100% ownership, and generally targets 51% majority ownership, with 100% ownership used on a case-by-case basis (e.g., Alpha Techno was 100% acquired, Adoval was acquired at ~51%). The company avoids deals that would create excessive goodwill that materially damages earnings, unless clear significant upside is confirmed, and reviews each deal carefully via an investment committee to ensure plans are in place to deliver results exceeding projections.

Q5: For the Global WiFi business, what is the current marginal profit margin, and is there still room for cost reduction? Is it correct that incremental revenue falls almost directly to incremental profit?

A: Excluding personnel costs, the simple cost ratio has fallen from over 20% historically to around 15% today, and with growing corporate penetration, the company can deliver revenue growth with almost flat overall costs, supporting profit growth. The company is driving process efficiency via AI adoption, and has already deployed 730 RPA bots to reduce middle process costs. The call center has handled a many-fold increase in volume with almost no increase in headcount, enabled by AI and chatbot automation. For Global WiFi, the strategy is to grow inner share within existing corporate clients (e.g., expanding from one department to the entire company) rather than just adding new corporate clients, to further grow revenue without proportional cost increases. Marginal profit will not reach 100% because personnel costs and roaming communication costs still increment with volume, so that should be clearly understood.

Q6: What is the updated timeline for the long-term 20 billion yen operating profit target? Is it earlier or later than originally planned?

A: The 20 billion yen operating profit target can be reached earlier if M&A progresses well than the original timeline. Even without M&A, there is still sufficient market room to reach that target at the current cruising growth pace, so it is achievable regardless.

Q7: How quickly will cost reduction from AI and DX deliver results, and what magnitude of savings should we expect?

A: The savings will scale as the company expands AI adoption, so the magnitude depends on how quickly AI technology advances. The company expects costs to fall faster than currently projected, but has not baked all potential savings into the current profit forecast. No specific timeline or magnitude can be provided at this point, but the company will actively pursue any efficiency opportunities as they arise, and the positive impact on profit will come through over time.

Q8: What is the background for the recent increase in the number of executive officers, and is this related to the medium-term plan revision?

A: The increase in executive officers is completely unrelated to the medium-term plan revision. The company promoted 4 highly capable performers to the executive level, to reduce the workload on existing executives and strengthen the leadership team to better drive the medium-term plan forward, with strong talent already in the pipeline behind the new executives.