Intelligent Wave Inc.TSE: 4847

Financial Results for 1H (Interim Period) FY06／25

· Issued by Intelligent Wave Inc.

Financial Results for 1H (Interim Period) FY06/25

(July 1 to December 31, 2024)

[Non-Consolidated]

Intelligent Wave Inc.

Announced on February 7, 2025

Copyright © INTELLIGENT WAVE INC. All rights reserved.

Financial Results for 1H FY06/25

Forecast for FY06/25

Progress of the Medium-Term Management Plan

Reference

Copyright © INTELLIGENT WAVE INC. All rights reserved.

2

Overview

  • Sales and profits increased due to steady growth in the mainstay payment domain.
  • Sales and profits are almost in line with the plan.
  • Orders on hand increased significantly due to a large project for infrastructure operation services and multi-year

contracts for cloud services.

Million yen

1H FY06/24

1H FY06/25

Change

Sales

Sales

Results

Results

(YoY)

composition

composition

ratio

ratio

Net sales

6,946

-

7,540

-

+594

+8.6%

Gross profit

2,200

31.7%

2,231

29.6%

+31

+1.4%

SG&A expenses

1,348

19.4％

1,374

18.2%

+26

+1.9%

Operating income

852

12.3％

857

11.4%

+5

+0.6%

Ordinary income

859

12.4％

887

11.8%

+27

+3.2%

Net income

584

8.4％

610

8.1%

+25

+4.4%

Amount of orders

9,772

-

12,751

-

+2,978

+30.5％

Orders on hand

13,800

-

21,795

-

+7,994

+57.9％

Copyright © INTELLIGENT WAVE INC. All rights reserved.

1H FY06/24

Forecast

Change

（vs.Forecast）

7,500

+0.5％

-

-

- -

  1. (0.3％)
  1. +0.9％
  1. +0.1％

3

Sales by Business Domain

  • In the payment domain, sales in the FEP and fraud detection areas increased due to system upgrades by existing customers,
    and the number of companies using cloud service rose. Sales in others areas decreased temporarily on a decline in the number of projects for existing customer.
  • In the security domain, sales increased due to product introductions to a major customer.
  • In the data communication and analysis infrastructure domain, sales increased mainly due to system development

for securities companies.

Million yen

1H FY06/24

1H FY06/25

Change(YoY)

Net sales

6,946

7,540

+594

+8.6%

Payment

5,784

6,166

+381

+6.6%

FEP *

2,493

2,721

+227

+9.1%

Fraud detection

750

1,179

+428

+57.1%

Acquiring

1,463

1,466

+2

+0.2%

Others

1,077

799

（277)

(25.8%)

Security

757

923

+166

+22.0%

Data communication and

403

449

+46

+11.4%

Analysis infrastructure

Reference) Cloud services

1,180

1,527

+347

+29.4%

＊Front-end processor (FEP) system: Hardware and software with network connectivity, card usage authentication, and other functions required for credit card payment processing

Copyright © INTELLIGENT WAVE INC. All rights reserved.

4

Top Five Clients by Sales

  • For DNP, security-related sales increased due to the introduction of new security products.
  • Sales for both the second and third "System Integrator" declined due to a large project for a credit card company that was shifted to the system development phase.

Million yen

1H FY06/24

1H FY06/25

Change

Main projects

(YoY)

1.

DNP

871

930

+58

・

2.

System Integrator

784

607

(176)

System development for credit card company

3.

System Integrator

317

454

+137

System development for credit card company

4． Credit card company

504

426

(77)

5． Credit card company

330

402

+72

Copyright © INTELLIGENT WAVE INC. All rights reserved.

5

Sales by Category

■System development sales decreased due to the shift of development phases for a large project, but increased due to system upgrades for existing customers.

■Cloud services sales increased due to an increase in the number of users and addition of functions for existing users.

  • Security rose, mainly due to product introductions to a major customer.

Million yen

1H FY06/24

1H FY06/25

Change(YoY)

Net sales

6,946

7,540

+594

+8.6％

System development

3,457

3,479

+21

+0.6％

Maintenance

798

796

(1)

(0.2％)

In-house products and services

173

165

(8)

(4.8％)

Third-party products and services

578

647

+68

+11.9％

(hardware, etc.)

Cloud services

1,180

1,527

+347

+29.4％

Security

757

923

+166

+22.0％

Copyright © INTELLIGENT WAVE INC. All rights reserved.

6

Operating income

  • Gross margins in system development and maintenance in the payment domain remained steady, but gross profit margins declined as gross maegins in cloud services declined. We will continue to improve gross margins by enhancing productivity in system development and maintenance and adjusting prices to better reflect the value provided.
  • Selling, general and administrative (SG&A) expenses increased due to higher labor costs, but the SG&A-to-sales ratio declined.

1,000■ … Operating income ●… Operating margin

25.0%

Gross profit

SG＆A expense

Million yen

Operating income

Gross profit margin

SG&A expense ratio

Operating margin

900

803

800

700

600

500

400 11.8%

300

200

100

0

1H FY06/23

852 857

12.3% 11.4%

1H FY06/24

1H FY06/25

1,600

20.0%

1,400

1,200

15.0%

1,000

800

10.0%

600

5.0% 400

200

0.0%

0

31.1%

31.4%

32.2%

33.0%

30.2%

32.9%

33.6%

32.6%

27.6%

31.3%

21.2%

21.5%

21.9%

17.9%

20.9%

17.3%

16.7%

18.4%

19.1%

17.5%

13.3%

10.2%

10.7%

12.1%

8.3%

15.5%

16.9%

14.2%

13.8%

8.6%

1,134

1,149

1,244

1,278

1,229

1,252

985

1,000

979

728

955

651

665

667

691

656

644

694

675

699

588

634

534

483

332

553

319

420

304

263

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

FY06/23

FY06/24

FY06/25

Copyright © INTELLIGENT WAVE INC. All rights reserved.

7

Cloud Service Business

  • Sales increased due to an increase in the number of users and addition of functions for existing users.
  • Infrastructure costs have increased due to delays in the infrastructure migration for cloud services. We will work

on improving operational efficiency and adjusting service prices to better reflect the value provided, and will continue to improve gross margins.

Million yen

FY06/24

FY06/25

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

Amount of orders

614

969

890

2,761

1,618

1,932

Net sales

592

587

618

705

718

809

Orders on hand

6,717

7,098

7,371

9,426

10,326

11,449

Gross profit

96

84

94

75

(20)

128

■Number of customers

■Overview

40

IOASIS

IFINDS

Service

Overview

IGATES

IPRETS

1

1

■ IOASIS

Demand grew from existing customers for additional functionality and

1

1

1

9

9

expansion in response to increased transaction volumes.

9

9

9

20

1

A growing number of companies are adopting "FARIS Shared Scoring

12

6

6

11

12

■ IFINDS

Service Powered by PKSHA Security," which enables issuers to share AI-

9

1

3

based fraud analysis data to prevent fraud. New services are being

2

4

progressively rolled out as part of our next-generation fraud prevention

10

10

3

3

10

10

10

10

project "FARIS."

0

5

5

■ IGATES

A large-scale project to develop a cross-industry multi-user platform for

24年６⽉期 25年６⽉期

FY06/20

FY06/21

FY06/22

FY06/23

FY06/24

1H

1H FY06/24

1H FY06/25

FY06/25

was released in January 2025.

2Q

2Q

Copyright © INTELLIGENT WAVE INC. All rights reserved.

8

Amount of orders (by Category)

  • Received a large order for infrastructure operation services for a financial institution and will start providing such

services from January 2025.

  • System development decreased due to the shift of development phases for a large project.
  • Cloud services increased due to new projects and addition of functions for existing customers.

■ …System Development

Million yen

■ …Maintenance, In-house products and services, Third-party products and services

■ …Cloud Services

■ …Security

14,000

12,751

7,156

12,000

2,619

6,355

704

305

9,772

5,421

5,515

5,594

10,000

1,932

1,439

286

631

3,550

4,257

2,761

1,915

8,000

1,584

969

4,000

6,459

2,794

807

3,130

3,329

821

6,000

454

2,613

132

2,904

610

1,781

2,835

1,329

3,151

322

890

1,147

1,618

507

822

273

839

4,000

1,847

297

903

945

864

807

857

315

2,000

2,829

4,135

3429

1,398

1,430

1,477

1,527

2,001

2,134

1,430

2,142

1,745

1,683

0

1H FY06/23

1H FY06/24

1H FY06/25

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

Q1

Q2

Q3

Q4

FY06/23

FY06/24

FY06/25

9

Copyright © INTELLIGENT WAVE INC. All rights reserved.

Orders on Hand (by Category)

■The order backlog for infrastructure operation services for financial institutions and multi-year contracts for cloud services and security increased.

■System development decreased due to the shift of development phases for a large project.

■ …System Development

■ …Maintenance, In-house products and services, Third-party products and services

Million yen

■ …Cloud Services

■ …Security

25,000

21,795

20,000

15,000

10,000

5,000

13,800

1,264

9,233

606 7,098

4,589

21,795

3,289

11,449

4,837

18,636

3,289

16,584

3,102

1,594

13,800

13,995

11,548

10,974

12,073

1,264

1,639

11,449

605

1,071

582

9,426

10,326

9,047

9,233

7,098

749

606

6,717

7,371

4,214

6,913

6,695

4,589

3,188

3,295

2,704

4,837

2,297

3,188

2,212

2,297

2,286

2,126

2,309

2,964

0

1,741 2,249

１H FY06/22 １H FY06/23

2,217

１H FY06/24

1,872

1,741

1,744

1,571

1,976

2,249

2,020

2,268

2,503

2,217

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

FY06/25

FY06/23

FY06/24

Copyright © INTELLIGENT WAVE INC. All rights reserved.

10

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