Daiwa Securities Group (8601) Q1 2026 earnings summary

Executive summary

• Net operating revenues for Q1 FY2025 were JPY 155.2 billion, up 4.1% year-over-year but down 10.9% sequentially, with ordinary income at JPY 43.7 billion, up 15.8% year-over-year and down 14.3% quarter-over-quarter.

• Profit attributable to owners was JPY 31.2 billion, up 30.2% year-over-year and 4.3% quarter-over-quarter, with annualized ROE at 7.7%.

• Base income increased 10.3% year-over-year to JPY 34.1 billion, accounting for 78.2% of consolidated ordinary income.

• Wealth Management and Asset Management divisions achieved record-high assets under management and stable results.

• The group maintained stable earnings despite significant market volatility triggered by U.S. tariff policy and subsequent market turmoil.

Financial highlights

• Commissions received totaled JPY 100.4 billion, up 7.4% year-over-year but down 12.6% sequentially; brokerage commissions fell 8.2–8.7%, and underwriting and secondary offering commissions dropped 41.6%.

• SG&A expenses were JPY 119.0–119.1 billion, up 4.4% year-over-year and down 1.8% sequentially, with reductions in trading-related and personnel expenses.

• EPS for the quarter was JPY 22.20, up from JPY 17.10 a year earlier; BPS was JPY 1,154.60.

• Net trading income dropped 18.9% to JPY 22.3 billion, while net financial income rose 7.4% to JPY 19.7 billion.

• Overseas ordinary income was JPY 3.8 billion, down 35.9% sequentially but up 68.2% year-over-year.

Outlook and guidance

• July saw a recovery in equity flows for both institutional and retail investors, and FICC activity remained strong, indicating a positive start to Q2.

• Management remains focused on total asset consulting, stable asset-based revenues, and expanding wrap account services amid ongoing market volatility.

• No earnings forecasts disclosed for the fiscal year ending March 31, 2026, due to market uncertainty.

• Dividend policy targets a payout ratio of 50% or more, with a minimum annual dividend of JPY 44 per share through FY2027.