Daikoku Denki (6430): FY2025 Results Summary — Lower Sales and Profit; Operating Profit Forecast Down 53.5% for FY3/2027

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

Note: Daikoku Denki 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. The source materials label the most recently completed fiscal year, ended March 31, 2026, as FY3/2026 (2026/3期); the body and tables below follow the labels used in the materials, while the title uses FY2025 under this site’s naming convention.

For the fiscal year ended March 2026 (FY3/2026), Daikoku Denki reported consolidated net sales of 54,337 million yen (down 5.5% year on year), operating profit of 9,673 million yen (down 21.0%), ordinary profit of 9,831 million yen (down 19.6%), and profit attributable to owners of parent of 5,754 million yen (down 25.5%), closing the year with lower sales and profit. The main factor was the end of the special demand for machine upgrades prompted by the issuance of new banknotes, but the company maintained a high level of earnings on the back of capital investment demand accompanying the spread of smart gaming machines and contributions from titles developed by group companies. For FY3/2027, the company forecasts that both operating profit and ordinary profit will fall by more than half from the previous year, factoring in the reaction to the banknote-related special demand as well as increases in R&D and other expenses.

Consolidated Results (Full Year)

Consolidated net sales for FY3/2026 were 54,337 million yen (versus 57,492 million yen in the prior year), down 5.5% year on year. Gross profit was 24,730 million yen (down 7.5%), while selling, general and administrative expenses rose to 15,056 million yen (up 4.0%); as a result, operating profit was 9,673 million yen (down 21.0%), ordinary profit was 9,831 million yen (down 19.6%), and profit attributable to owners of parent was 5,754 million yen (down 25.5%). Note that from the fiscal year under review, the presentation of profit and loss related to real estate leasing was changed from non-operating income/expenses to net sales and cost of sales (figures in millions of yen).

Item	FY3/2026	FY3/2025	Change
Net sales	54,337	57,492	△5.5%
Gross profit	24,730	26,723	△7.5%
Selling, general and administrative expenses	15,056	14,480	+4.0%
Operating profit	9,673	12,242	△21.0%
Ordinary profit	9,831	12,231	△19.6%
Profit attributable to owners of parent	5,754	7,727	△25.5%

Segment Results

By segment, the Information Systems business posted net sales of 45,768 million yen (down 12.2% year on year) and segment profit of 11,203 million yen (down 22.2%), with both sales and profit declining, mainly due to the reaction to the special demand related to the new banknotes. In contrast, the Amusement business achieved a substantial increase in both sales and profit, with net sales of 6,419 million yen (up 44.2%) and segment profit of 1,118 million yen (up 213.9%), helped by sales of the smart pachislot machine “Yokoso Jitsuryoku Shijo Shugi no Kyoshitsu e” developed by group company DAXEL Co., Ltd. and the PS5 version of Genki Co., Ltd.’s in-house game title “Shutoko Battle.” The Other business returned to profitability with net sales of 2,208 million yen (up 128.5%) and segment profit of 13 million yen, aided by contributions from the Hakone Glass Forest Museum (figures in millions of yen).

Segment	Metric	FY3/2026	FY3/2025
Information Systems	Net sales	45,768	52,125
Information Systems	Segment profit	11,203	14,405
Amusement	Net sales	6,419	4,452
Amusement	Segment profit	1,118	357
Other	Net sales	2,208	967
Other	Segment profit	13	△148

Full-Year Forecast

For FY3/2027, the company forecasts consolidated net sales of 48,000 million yen (down 11.7% year on year), gross profit of 21,300 million yen (down 13.9%), selling, general and administrative expenses of 16,800 million yen (up 11.6%), operating profit of 4,500 million yen (down 53.5%), ordinary profit of 4,600 million yen (down 53.2%), and profit attributable to owners of parent of 3,100 million yen (down 46.1%). While capital investment demand driven by the spread of smart gaming machines is expected to continue, the company anticipates that the pace of increase in their penetration rate will moderate, and it has factored in higher R&D and related expenses for the development of new products and services, in-house smart pachislot development, and the strengthening of DX-related initiatives. The company plans R&D expenses of 1,400 million yen (up 38.3%), depreciation of 1,900 million yen (up 13.3%), and capital expenditures of 2,900 million yen (up 7.3%).

Item	FY3/2027 (Forecast)	FY3/2026 (Actual)
Net sales	48,000	54,337
Gross profit	21,300	24,730
Selling, general and administrative expenses	16,800	15,056
Operating profit	4,500	9,673
Ordinary profit	4,600	9,831
Profit attributable to owners of parent	3,100	5,754

By segment, the FY3/2027 forecast calls for the Information Systems business to post net sales of 40,600 million yen (down 11.3% year on year) and segment profit of 7,400 million yen (down 33.9%); the Amusement business to post net sales of 4,400 million yen (down 31.5%) and a segment loss of 200 million yen (versus a profit of 1,118 million yen in the prior year); and the Other business to post net sales of 3,000 million yen (up 35.9%) and segment profit of 200 million yen (up 1,385.6%). With the rate of decline in the number of pachinko halls showing signs of moderating, the Information Systems business plans to start “FAN+AD,” a collaborative service with Tsuburaya Fields Holdings, and to begin offering “DK-SIS INFINITY,” while the Amusement business is advancing development toward the market launch of its second in-house smart pachislot title.

Shareholder Returns

On dividends, the company’s basic policy is to pay stable dividends while comprehensively taking into account the business environment, earnings conditions, the payout ratio and other factors, and to return profits in line with business performance. For FY3/2026, the company paid an interim dividend of 30 yen and a year-end dividend of 70 yen, for an annual dividend of 100 yen (consolidated payout ratio of 25.3%); for FY3/2027, it plans an interim dividend of 40 yen and a year-end dividend of 60 yen, for an annual dividend of 100 yen (47.0%). For FY3/2026 through FY3/2028, the company has set 100 yen as its minimum annual dividend.

Item	FY3/2026 (Actual)	FY3/2027 (Planned)
Interim dividend	30 yen	40 yen
Year-end dividend	70 yen	60 yen
Annual dividend	100 yen	100 yen
Consolidated payout ratio	25.3%	47.0%

Medium-Term Plan / Topics

Under its medium-term management plan, the company has set out the vision “Make CX Amazing — Bringing unknown customer experiences to the world,” with a policy of investing cash generated by its existing businesses (the Information Systems and Amusement businesses) into new businesses and M&A, aiming for a new-business weight of 25% in FY2030 (versus 3.1% in FY2024). In expanding new businesses and business domains, the company brought into the group SHUNRI Co., Ltd., operator of the Japanese crepe specialty shop “Tabanenoshi,” and established Chagri Co., Ltd. to secure a stable supply of matcha raw materials and address issues at production sites, developing new businesses centered on matcha. The Hakone Glass Forest Museum advanced initiatives for its 30th anniversary. In the Information Systems business, the company is building “AX (tentative name),” a next-generation platform utilizing DX and AI technologies, introduced “FAN+AD,” a new service in collaboration with Tsuburaya Fields Holdings, and began offering “DK-SIS INFINITY,” a new cloud service that revamps “DK-SIS.” In the Amusement business, the company is developing its second in-house smart pachislot title.

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.