MicroAd,Inc. Q1 FY2026 earnings call

Consolidated Overall Performance

• Total consolidated revenue: 4.557 billion yen, up 17.7% year-over-year
• Adjusted operating profit: 444 million yen, up 171% year-over-year (3.2x increase)
• Ordinary profit: 385 million yen, up 421% year-over-year (5.3x increase)
• The quarter set a record high for quarterly operating profit, marking a very strong start to MicroAd's formal profit generation phase that began in the 2026 September term

UNIVERSE Customer Segment Trends

• Large client agency channel: Grew significantly both year-over-year and quarter-over-quarter
• Large client direct sales channel: Stopped declining year-over-year and has been growing since Q4 of the previous fiscal cycle
• Small and medium clients: Grew solidly both year-over-year and quarter-over-quarter

Strategic Expansion Initiatives

• UNIVERSE Data Economic Zone Expansion to Third-Party Ad Platforms: Starting in the 2026 September term, MicroAd expanded its proprietary data distribution beyond its own platform to major third-party platforms including Facebook, Instagram, and TikTok, to increase overall ad distribution reach. A service classification change was implemented: third-party platform operations were moved from the "other" category under consulting to the "UNIVERSE" category under data products.
• New Data External Sales Business: Launched a new business that sells MicroAd's large-scale consumer behavior data to third-party companies. The data improves the resolution of client customer interest/behavior data, enabling more precise CRM and marketing initiatives, and the company aims to uncover new market demand for this offering.
• New To-C Businesses (Launched 2025 September Term): - TikTok Shop related business: Subsidiary UNIVERSE PULSE launched the live variety program Oshi Koma! on TikTok LIVE in December 2025; related company IZULCA recorded 1st place weekly sales out of all products on TikTok Shop for its Toyooka branded new rice in November 2025. The company will continue running trials to refine this new business segment. - IP mixer (IP overseas expansion and e-commerce): The subsidiary has launched multiple new collaboration products, including collaborations between VTuber agencies (Nijisanji, Hololive English) and third-party brands (RHINOSHIELD). For the 2026 September term, the company plans to increase the number of projects and available IP, and prepare entirely new expansion initiatives.

Long-Term Company Vision

• MicroAd's long-held vision since IPO is to expand beyond advertising data applications to become a "comprehensive data company", expanding data usage to new non-advertising verticals

1. Data Product (overall): Revenue increased 11% year-over-year; gross profit increased 25% year-over-year. The strong gross profit growth is driven by productivity improvement initiatives implemented in the 2025 September term to boost margin. No overall absolute revenue amount is provided, and overall data product revenue contributes to the total 4.557 billion yen consolidated revenue. 2. UNIVERSE (Owned Platform): Gross profit increased 19% year-over-year. Active accounts grew 12% year-over-year with steady growth. 3. UNIVERSE (Third-Party Platform): Revenue increased 52% year-over-year; gross profit increased 66% year-over-year. Active accounts grew 30% year-over-year, with a very strong start to the focused expansion initiative. 4. Consulting (overall): Revenue increased 27% year-over-year; gross profit increased 31% year-over-year, with strong double-digit growth across all sub-segments. - Domestic Media Consulting: Revenue increased 47% year-over-year; gross profit increased 45% year-over-year, with no one-off special factors driving growth. - Overseas Consulting: Revenue increased 9% year-over-year; gross profit increased 20% year-over-year, with a steadily improving earnings base. - Alternative Data Business: After a major strategy revision in H2 of the 2025 September term, the business delivered monthly returns exceeding 10 million yen in November and December, with a cumulative return of approximately 20 million yen for the 1st quarter. The revised new model is functioning very well with consistent current performance.

• Full-year 2026 September term performance against the initial guidance: Revenue and all profit metrics came in above management's initial expectations at the 1Q stage, with particularly strong progress on profit growth
• Management will not revise the full-year guidance at the 1Q stage. It will wait to evaluate performance through the second quarter before reassessing and reconsidering guidance adjustments at that point
• There are no immediate concerns around performance at the current stage, and management views waiting for more operational data as the appropriate approach
• Management's medium-term target (1 to 2 years from now) is 1.5 billion yen in operating profit. This target is fully achievable when revenue (excluding new businesses) exceeds 20 billion yen, and the business is currently progressing on schedule to hit this target

Management stated that there are no material concerns or risks to performance at the current 1Q stage. All new initiatives are progressing as planned, with no disclosed operational failures or material risk factors in the call transcript.

No question and answer section was included in the provided earnings call transcript.