Soliton Systems (3040): FY2025 Results Summary — Record Profit on IT Security Growth

This article is based on publicly available IR materials and is not a recommendation to buy or sell any specific securities.

Note: Soliton Systems does not publish an English results presentation; this article is an English translation of the Japanese-language article on our sister site Investalk, which is based on the company’s Japanese-language IR materials, with figures transcribed as reported. Soliton Systems has a December fiscal year-end, so the fiscal year ended December 2025 is the latest completed full year.

Soliton Systems announced its consolidated results for the fiscal year ended December 2025 (full year). Net sales were 19,762 million yen (up 6.2% year on year) and operating profit was 2,844 million yen (up 39.2%), a record high. Net income attributable to owners of the parent was 2,298 million yen (up 33.2%), achieving double-digit profit growth. While Soliton Shanghai, which had annual sales of about 500 million yen, was excluded from the scope of consolidation through a share transfer in March 2025, the growth of the company’s own products and services in the IT security business drove results.

Consolidated Results (Fiscal Year Ended December 2025, Actual)

The gross profit margin improved to 46.7% (44.6% in the prior year), and the operating profit margin was 14.4% (11.0% in the prior year). Cost of sales rose to 10,524 million yen (up 2.1% year on year) in line with higher sales, and selling, general and administrative expenses were 6,392 million yen (up 2.3%), mainly due to increased bonus payments to employees accompanying the record profit. Non-operating income of 152 million yen, including interest income and foreign exchange gains, was recorded, and ordinary profit was 2,977 million yen (up 38.1% year on year).

Item	FY Ended Dec 2024 (Actual)	FY Ended Dec 2025 (Actual)	YoY
Net sales	18,606 million yen	19,762 million yen	+6.2%
Gross profit	8,293 million yen	9,237 million yen	+11.4%
Operating profit	2,043 million yen	2,844 million yen	+39.2%
Operating margin	11.0%	14.4%	–
Ordinary profit	2,156 million yen	2,977 million yen	+38.1%
Net income	1,725 million yen	2,298 million yen	+33.2%

Segment Results (by Business)

The sales mix by business for the fiscal year ended December 2025 was 94% for the IT security business, 5% for the video communication business, and 1% for the Eco new business development. In the mainstay IT security business, sales of the company’s own products and services were strong on the back of large deals in the defense and disaster-prevention fields and expanding demand for school administrative DX; segment sales were 18,516 million yen (up 5.9% year on year) and segment profit was 3,717 million yen (up 17.3%), with the operating margin improving from 18.1% to 20.1%. Merchandise and product sales grew to 7,321 million yen (up 8.3%) and cloud service sales to 2,652 million yen (up 14.0%), while maintenance sales edged down to 5,452 million yen. In the video communication business, product sales in the defense and disaster-prevention fields were firm, and segment profit was 1,053 million yen (1,000 million yen in the prior year). In the Eco new business development, although sales of ICs for human-presence sensors and others grew 30% year on year, continued development investment in analog edge AI devices widened the segment loss to 191 million yen (122 million yen in the prior year).

Business	Metric	FY2024	FY2025	YoY
IT Security	Segment sales	17,482 million yen	18,516 million yen	+5.9%
IT Security	Segment profit	3,170 million yen	3,717 million yen	+17.3%
Video Communication	Segment profit	1,000 million yen	1,053 million yen	–
Eco New Business Development	Segment loss	122 million yen	191 million yen	–

Full-Year Forecast (Fiscal Year Ending December 2026)

For the fiscal year ending December 2026, the company forecasts net sales of 21,200 million yen (up 7.3% year on year), operating profit of 3,150 million yen (up 10.7%), ordinary profit of 3,200 million yen (up 7.5%), and net income attributable to owners of the parent of 2,350 million yen (up 2.3%). The operating profit margin is expected to be 14.9% (14.4% in the prior year). The company intends to pursue both expansion of sales scale and improvement in profitability, and to strengthen the management foundation for sustained medium- to long-term growth; the medium-term plan for the fiscal years ending December 2026 to December 2028 is under development (scheduled to be announced in early March 2026).

Item	FY Ended Dec 2025 (Actual)	FY Ending Dec 2026 (Forecast)	Change	% Change
Net sales	19,762 million yen	21,200 million yen	+1,437 million yen	7.3%
Operating profit	2,844 million yen	3,150 million yen	+305 million yen	10.7%
Operating margin	14.4%	14.9%	+0.5pt	–
Ordinary profit	2,977 million yen	3,200 million yen	+222 million yen	7.5%
Net income	2,298 million yen	2,350 million yen	+51 million yen	2.3%

Shareholder Returns

For the next fiscal year (ending December 2026), based on expected net income attributable to owners of the parent of 2,350 million yen and its basic policy on profit distribution, the company plans a dividend of 60.00 yen per share (including an interim dividend of 30.00 yen). The consolidated payout ratio is expected to be 47.3% and the consolidated dividend on equity (DOE) 7.8%. The basic policy sets a guideline of a consolidated payout ratio of around 50.0% or a consolidated DOE of around 8.0%, and the annual dividend will mark the seventh consecutive year of increase. Retained earnings are to be used to fund strategic investments essential to growth, such as development of analog edge AI chips and new development investment toward the shift to cloud services.

Item	Next Fiscal Year (Ending Dec 2026) Plan
Dividend per share	60.00 yen (incl. interim dividend of 30.00 yen)
Payout ratio (consolidated)	47.3%
Dividend on equity, DOE (consolidated)	7.8%

Topics

In the Eco new business development, positioned as an investment business, the company is continuing development of an analog AI chip that achieves ultra-low power consumption, and plans to begin performance evaluation of prototype chips from autumn 2026. In addition, with support from JAXA’s Space Exploration Innovation Hub, the design of a space-use FPGA for the Lunar Polar Exploration (LUPEX) rover has entered its second phase. In the IT security business, the company is working to accelerate its cloud shift, including strengthening integration with its cloud-based ID management service “Soliton OneGate” and providing zero-trust environments through an alliance with Amiya Co., Ltd.

This article is an analysis based on publicly available information and is not a recommendation to buy or sell any specific securities. Investment decisions are your own responsibility.