TIS (3626) Q2 2026 earnings summary

Executive summary

• Net sales and operating income rose year-over-year in H1 FY2026, surpassing estimates and achieving a record operating margin in the 12% range, with profit attributable to owners up 13.8%.

• Growth was driven by robust IT investment demand, digital transformation, and high value-added business expansion, despite higher costs from proactive growth investments.

• Orders received and order backlog both increased year-over-year, reflecting strong demand for IT investment and digital transformation services.

• Extraordinary income of ¥2,100 million (mainly from sale of investment securities) and extraordinary losses of ¥1,653 million (mainly impairment losses) were recorded.

• Full-year forecasts were revised upward due to strong first-half results, with continued focus on growth investment and productivity improvements.

Financial highlights

• Net sales for H1 FY2026 were ¥288.5 billion, up 4.7% year-over-year; operating income was ¥35.6 billion, up 16.5%; net income attributable to owners was ¥23.7 billion, up 13.8%.

• Gross profit margin rose to 28.0% in H1 FY2026, up 0.5 points year-over-year; gross profit increased to ¥80,746 million.

• Actual results exceeded estimates: net sales by 1.2%, operating income by 7.7%, and net income by 7.8%.

• Orders received in H1 FY2026 increased 4.6% year-over-year to ¥294.3 billion; order backlog at Q2-end rose 4.3% to ¥204.1 billion.

• Basic earnings per share for the period was ¥103.10, up from ¥89.44 a year earlier.

Outlook and guidance

• Full-year FY2026 net sales forecast revised up to ¥588.0 billion (+2.9% YoY), operating income to ¥75.0 billion (+8.6% YoY), and net income to ¥50.0 billion (flat YoY).

• Operating margin expected to rise to 12.8%; ROE forecast at 14.8%.

• Dividend forecast for FY2026 is ¥76.00 per share, up from ¥70.00 in FY2025.

• Segment forecasts: growth expected in all segments except Financial IT, where sales are projected to decline slightly but profitability to improve.

• Guidance incorporates minor impact from planned merger with INTEC.