Kokusai Electric Corp (KOKSF) Q3 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

This is Kawakami, Senior Vice President and CFO. Thank you very much today for participating in the financial results briefing of Kokusai Electric. At the beginning, I will explain the third quarter results and the full year forecast. Here are the disclaimers for you to note. First is the third quarter results summary. Page four is the highlight. I will go over the specifics from the next page onwards. Page five is consolidated results summary of the third quarter and third quarter year to date. Although the October to December third quarter saw a decrease in revenue and profits year on year and quarter on quarter, both revenue and profits were in line with a revised forecast released at the time of the second quarter results. The third quarter year-to-date saw slight decrease in revenue year-on-year, and each profit line decreased year-on-year due to changes in the product mix and upfront investments for the future. The lower gross profit margin for the third quarter and third quarter year to date, year on year and quarter on quarter, is because of the decrease in production volume and changes in product mix in the second half, as we explained at the second quarter results. Orders received in the third quarter was 62 billion and exceeding expectations. We expect the same trend to continue in the fourth quarter. R&D expenses, capital expenditures, depreciation, and amortization were largely in line with expectations. Page 6 shows third quarter year-on-year factors for change in revenue and adjusted operating profit. The third quarter, year-on-year, saw increases in upgrade modifications of existing equipment's performance and functionalities instead of new equipment sales, primarily in DRAM sector, resulting in an increase in service revenue. Conversely, equipment sa...