MEDIA DO (3678): FY2025 Results Summary — Record Net Sales on eBook Distribution Growth; Profit Dips as Seven Seas Acquisition Opens Next Stage

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

Note: MEDIA DO Co., Ltd. has a February fiscal year-end and labels the fiscal year covered here as “FYE 2/26” (the fiscal year ended February 28, 2026); on this site the most recently completed fiscal year is classified as FY2025, and the labels used in the text, tables and segment data below follow the company’s own materials (FYE 2/26 = fiscal year ended February 2026, FYE 2/27 = the current fiscal year). The company’s English results presentation states its figures in U.S. dollars, calculated at the exchange rate as of April 10, 2026 ($1 = ¥159.30); the figures below are transcribed as presented.

MEDIA DO, Japan’s largest eBook distributor, reported FYE 2/26 net sales of $681.3 million (+6.5% YoY), which the company describes as a record high for the first time in four years, driven by growth in both existing and new distribution channels in the eBook Distribution business. EBITDA was $23.0 million (-3.2% YoY) and operating profit $15.4 million (-0.9% YoY), as delays in improving the profitability of the Strategic Investment businesses (NIHONBUNGEISHA and Flier) and investment in translation system development to accelerate overseas expansion weighed on profit. Profit attributable to owners of parent rose 33.3% to $11.4 million, reflecting the gain on sale of MyAnimeList (MAL) recorded in March 2025. For FYE 2/27 the company forecasts net sales of $740.7 million (+8.7%) and operating profit of $15.0 million (-2.2%), and plans to maintain the dividend at ¥40 per share.

Consolidated Results (Full-Year Actual)

Net sales of $681.3 million achieved 102.4% of the full-year forecast of $665.4 million. Profit items fell short of the initial forecast: EBITDA reached 93.3% of the $24.6 million forecast, operating profit 90.2% of the $17.0 million forecast, and profit attributable to owners of parent 90.9% of the $12.5 million forecast. The company attributes the shortfall to delays in the improvement of the Strategic Investment businesses (NIHONBUNGEISHA and Flier), which occurred in H2. The impact of the MAL gain on sale on profit attributable to owners of parent was +$3.3 million.

Item (USD)	FYE 2/26	FYE 2/25	YoY	FYE 2/26 Forecast	Achievement Rate
Net sales	$681.3 million	$639.7 million	+6.5% (+$41.6 million)	$665.4 million	102.4%
EBITDA	$23.0 million	$23.7 million	-3.2% (-$0.7 million)	$24.6 million	93.3%
Operating profit	$15.4 million	$15.5 million	-0.9% (-$0.1 million)	$17.0 million	90.2%
Profit attributable to owners of parent	$11.4 million	$8.5 million	+33.3% (+$2.9 million)	$12.5 million	90.9%

Operating profit decreased due to investments to accelerate growth in focus areas (translation system development and security enhancements), the termination of high-margin services in the eBook Distribution business in H2, and delays in reducing losses in the Strategic Investment businesses. Net sales reached record highs for both the full year and Q4. As part of a review of its business portfolio, the company completed the sale or liquidation of seven entities in FYE 2/26, including affiliates such as MyAnimeList, and states a policy of no minority investments as a general rule going forward.

Segment Results

MEDIA DO has two reportable segments: the eBook Distribution business and the Strategic Investment businesses. In the eBook Distribution business, net sales reached a record high for Q4, and the decrease in operating profit was smaller than expected: although the company anticipated a profit decline due to the termination of high-margin services in Q3, growth in both existing and new distribution channels exceeded initial forecasts. Following the start of transactions with Mecha Comic in July 2025, the growth rate for new distribution channels from July to February trended at +4.4%.

Reportable Segment (USD millions)	Metric	FYE 2/26	FYE 2/25
eBook Distribution business	Net sales	634.6	588.9
eBook Distribution business	Operating profit	30.8	31.2
eBook Distribution business	Full-year operating profit margin	4.9%	5.3%
Strategic Investment businesses	Net sales	54.7	59.1
Strategic Investment businesses	Operating loss	-3.9	-5.9

The Strategic Investment businesses achieved net sales growth on an organic basis, excluding the impact of the sale of Everystar, and improved their operating loss by $2,023 thousand YoY, from -$5,987 thousand to -$3,964 thousand. By component, the Global business loss increased by $307 thousand due to organizational strengthening for overseas expansion, while NIHONBUNGEISHA (+$568 thousand), Flier (+$136 thousand), Others (+$130 thousand), the SC business (+$214 thousand) and Adjustments (+$1,279 thousand, reflecting reduced amortization expenses following the sale of Everystar and goodwill impairment at subsidiaries) contributed improvements. However, the loss increased in Q3 and Q4, primarily due to poor performance at NIHONBUNGEISHA and $0.2 million in acquisition-related expenses for Flier’s acquisition of Zealox. From FYE 2/26, GAMBAROU TOKUSHIMA has been included in the Strategic Investment businesses, and FYE 2/25 figures have been restated.

By type of service, the company presents net sales as follows. Web service operation declined mainly due to the sale of Everystar, while Solutions for Publish Industry saw lower sales from non-core, low-margin businesses as recurring-revenue businesses continued to grow.

Type of Service (USD millions)	FYE 2/26	FYE 2/25	YoY
Distribution (eBook Distribution business)	628.6	581.6	+8.1% (+47.0)
Book/magazine publishing (NIHONBUNGEISHA)	12.6	12.6	-0.2% (-0.0)
Web service operation (Manga Saison, Audiobook, FanTop, Digital library, Flier)	16.8	22.9	-26.6% (-6.1)
Solutions for Publish Industry (Firebrand, NetGalley, Supadü)	17.6	17.4	+0.7% (-0.2)
Other (MD-i, ARTRA, GAMBAROU TOKUSHIMA)	5.5	4.9	+11.0% (+0.6)
Total	681.3	639.7	+6.5% (+41.6)

FYE 2/27 Forecast

For FYE 2/27, MEDIA DO expects net sales to continue growing, while profit is projected to decline due to planned investments in focus areas such as the eBook Distribution business, Global business and SC business under the Medium-Term Management Plan. Net sales and EBITDA are expected to reach record highs. The decline in profit attributable to owners of parent also reflects the absence of the MAL gain on sale recorded in FYE 2/26 (+$3.3 million).

Item (USD)	FYE 2/27 Forecast	FYE 2/26 Results	YoY
Net sales	$740.7 million	$681.3 million	+8.7% (+$59.4 million)
Operating profit	$15.0 million	$15.4 million	-2.2% (-$0.4 million)
Ordinary profit	$12.8 million	$15.9 million	-19.6% (-$3.1 million)
Profit attributable to owners of parent	$7.5 million	$11.4 million	-34.0% (-$3.9 million)
EBITDA	$25.7 million	$23.0 million	+11.8% (+$2.7 million)
Net sales: eBook Distribution business	$653.4 million	$634.6 million	+18.8 million (+3.0%)
Net sales: Strategic Investment businesses	$95.4 million	$54.7 million	+40.7 million (+74.4%)
Operating profit: eBook Distribution business	$29.4 million	$30.8 million	-1.4 million (-4.7%)
Operating profit: Strategic Investment businesses	-$1.7 million	-$3.9 million	+2.2 million
Operating profit: Adjustment	-$12.6 million	-$11.4 million	-1.2 million

In the eBook Distribution business, profit is projected to decline due to the termination of high-margin services in FYE 2/26 and investments to strengthen the industry infrastructure. In the Strategic Investment businesses, the Global business will include nine months of earnings from Seven Seas starting from Q2, with an expected operating profit contribution of $1.7 million over nine months, while accounting for PMI expenses and investments for business expansion; the IP Solution business is expected to show improved profitability, and the SC business projects increased expenses for TOKUSHIMA GAMBAROUS’s B.ONE entry but will maintain profitability. Adjustments are expected to increase for security measures and organizational strengthening. The company notes that the full-year progress rate in Q1 is expected to be lower than in typical years.

Shareholder Returns

The dividend per share for FYE 2/26 is planned at ¥40, a record high in line with the initial forecast, for total dividends of $3.7 million and a dividend payout ratio of 33%. This compares with ¥36 for FYE 2/25 (ordinary dividend ¥28 plus a commemorative dividend of ¥8). The company explains that although profit attributable to owners of parent fell short of the initial forecast, the recorded extraordinary losses do not involve cash outlays, and that it decided to maintain stable dividend payments given its unchanged confidence in mid-to-long-term earnings growth. For FYE 2/27 the dividend is expected to be maintained at ¥40 per share despite the projected decrease in profit. MEDIA DO aims to further enhance shareholder value by maintaining its shareholder return policy of a total return ratio of 30% or more and gradually raising the return ratio, with stable returns through dividends and flexible share buybacks considered based on business conditions and stock price trends.

Growth Strategy and Topics

The Medium-Term Management Plan rests on three pillars: the eBook Distribution business, overseas expansion and the SC (Sustainability Creation) business. In eBook distribution, MEDIA DO describes itself as the largest eBook distributor in Japan, with gross merchandise value distributed of approximately $1.21 billion in FYE 2/26, more than 2,200 publishers and more than 150 eBook retailers as business partners, and approximately 30% of eBook distribution flowing via MEDIA DO. It aims to expand its market share by becoming essential infrastructure for the publishing industry, including developing BI tools, taking over operational tasks for publishers and eBook retailers, and strengthening cybersecurity.

For overseas expansion, MEDIA DO acquired Seven Seas Entertainment, one of the world’s largest publishers of translated manga, in March 2026 for $80 million (approx. ¥12.6 billion). Seven Seas, established in 2004, publishes about 1,000 titles annually and sells to bookstores worldwide through the distribution network of the Penguin Random House group; its FYE 12/24 results were net sales of ¥7.8 billion and operating profit of ¥1.6 billion (unaudited). A briefing for the publishing industry on March 16, 2026 was attended by 437 participants. In the SC business, the professional basketball team TOKUSHIMA GAMBAROUS recorded net sales of $3.7 million and operating profit of $0.3 million in its third season (25-26), and xIB JAPAN signed a partnership agreement with B.LEAGUE on April 14, 2026.

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.