Nec Corp Unsp/Adr New (NECPY) Q3 2026 Earnings Call

Investor webinar replay

Replay transcript excerpt

Thank you very much for your participation today. Allow me to explain the today announced financial results for Q3 fiscal year ending March 31, 2026. Allow me to follow the agenda as you see here. First, the highlights. For the nine-month period, domestic IT and ANS, aerospace and national security trended strongly. For telecom services, costs for future profit improvements were recorded in Q3. Therefore, for the nine-month accumulative for the year ending March 2026, revenue was plus 4.3% year-on-year at 2,422,000,000,000 yen. Non-GAAP operating profit increased by 47.5 billion yen from the last Fusca year to 209.9 billion yen. Considering the progression of performance for the nine-month period, we have amended the full-year outlook upwards. Non-GAAP operating profit has been updated by an increase of 20 billion yen to 360 billion yen. Allow me to explain the results for Q3. First, the key indices. For the nine months adjusted operating profit, there was an increase of 55.8 billion yen year-on-year to 206 billion yen, an OP ratio of 8.5%. Compared to internal projections, Adjusted operating profit outperformed by approximately 10 billion yen. Q3 three-months adjusted OP declined by 14.8 billion yen compared to last fiscal year. But, as explained earlier, this was due to the recording of 18 billion yen in expenses for telecom services' future profit structure improvements. Next is year-on-year change in adjusted and non-GAAP operating profit. Adjusted operating profit for the year ending March 2025 was 150.2 billion yen. Non-GAAP OP was 162.3 billion yen. This resulted in a surge in IT service profit. For social infrastructure, there was no impact from IP-related profit of 21 billion yen compared to last year, and AI usage investments increased internally, but there...