COVER (5253) Q1 2026 earnings summary

Executive summary

• Q1 FY2026/3 revenue rose 50.1% year-over-year to 9,629 million yen, with net profit up 11.9% to 693 million yen, driven by strong TCG and merchandising sales, and expansion in digital and overseas content.

• Operating profit increased 16.5% year-over-year to 972 million yen, supported by the "hololive OFFICIAL CARD GAME" and overseas initiatives.

• Upfront investments in technology, logistics, and overseas business development increased costs and temporarily reduced operating margin.

• Seasonal factors and North American tariffs led to a sequential decline from the previous quarter and a temporary EC sales slowdown.

• Streaming revenue adjusted slightly due to fewer events and performer retirements, but new and overseas talent initiatives supported year-over-year audience growth.

Financial highlights

• Revenue: 9,629 million yen (+50.1% YoY); Gross profit: 4,907 million yen (+47.6% YoY); Operating profit: 972 million yen (+16.5% YoY); Net profit: 693 million yen (+11.9% YoY).

• Merchandising revenue nearly doubled year-over-year (+99.2%) due to TCG sales and new store openings; Licensing/Collaborations up 7.4%.

• Gross margin improved to 51% in Q1 FY2026/3 from 50% in FY2025/3.

• Operating margin declined to 10% from 18% in the previous year due to upfront investments.

• Basic earnings per share for the quarter were 10.57 yen, compared to 10.35 yen a year earlier.

Outlook and guidance

• Full-year revenue forecast is 52,500 million yen, up 21.0% year-over-year; net profit forecast is 5,700 million yen, up 2.5%.

• No changes to the previously disclosed full-year forecast.

• Plans to expand summer content and events, launch English TCG sales, and increase overseas collaborations, especially in North America and Asia.

• FY2026/3 operating profit forecast at 820 million yen (15% margin), with reference value of 1,120 million yen (21%) excluding upfront investment expenditures.

• Medium-term targets set for 100 billion yen in net sales and 25 billion yen operating profit by FY2030/3.