HOYA (7741): FY25 Results Summary — Record IT Demand Lifts Revenue to ¥947.7bn as a New Capital Policy Targets Excess Cash

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HOYA CORPORATION reported FY25 full-year revenue of ¥947.7bn (+9%, CC +8%), operating profit of ¥285.2bn (+12%, CC +11%) and pretax profit of ¥327.7bn (+26%, CC +26%), with ROIC of 21.1%. In the Information Technology business, mask blanks and HDD substrates drove overall performance, and the Imaging business, which has returned to a growth trajectory, also contributed to revenue growth; in the Life Care segment, eye health products such as eyeglass lenses and contact lenses supported overall growth. In the fourth quarter alone, quarterly revenue and operating profit reached historical highs. Alongside the results, the company presented a new capital policy designed to release excess cash down to an optimal net cash level.

Consolidated Results (FY25 Full-Year Actual)

The presentation is prepared under IFRS, and the fiscal year ending March 2026 is referred to as “FY25” throughout the document. Operating profit is calculated as reference information for investors, by deducting finance income/costs, share of profits (loss) of associates, FX gain/loss and other temporary gain/loss from pretax profit. “CC” denotes constant currency.

Item	FY25 Full-Year	Change (YoY)	Change (CC)
Revenue	¥947.7 bn	+9%	CC +8%
Operating Profit	¥285.2 bn	+12%	CC +11%
Pretax Profit	¥327.7 bn	+26%	CC +26%
ROIC (NOPAT / Invested Capital)	21.1%	–	–
USD rate	151.09円	+1.0%	–
EUR rate	175.58円	-7.3%	–

Fourth-Quarter Results (FY25 Q4)

Consolidated revenue increased significantly in the fourth quarter, mainly driven by strong demand in the Information Technology business, and operating profit increased significantly driven by higher revenue. The company states that quarterly revenue and operating profit reached historical highs.

Item	FY25 Q4	Change (YoY)	Change (CC)
Revenue	¥248.1 bn	+15%	CC +9%
Operating Profit	¥74.7 bn	+14%	CC +10%
Pretax profit	¥76.6 bn	+15%	CC +12%
ROIC (NOPAT / Invested Capital)	19.5%	–	–
USD rate	156.45円	-3.5%	–
EUR rate	183.53円	-15.2%	–

Segment Results

HOYA discloses its businesses as the Life Care business (eyeglass lenses, contact lenses, medical-related products) and the Information Technology business (mask blanks, HDD substrates and imaging-related products). The segment figures shown on the results slides are quarterly figures, comparing FY24 Q4, FY25 Q3 and FY25 Q4.

Segment / Metric (¥bn)	FY24 Q4	FY25 Q3	FY25 Q4	YoY
Life Care — Revenue	140.3	151.5	155.1	+11% (CC +3%)
Life Care — Operating Profit	28.1	27.4	29.5	+5% (CC -1%)
Life Care — OPM	20.0%	18.1%	19.0%	–
Life Care — Pretax Profit	28.6	53.1	27.1	-6% (CC -11%)
Information Technology — Revenue	75.5	92.9	93.1	+23% (CC +20%)
Information Technology — Operating Profit	39.8	49.3	47.5	+19% (CC +17%)
Information Technology — OPM	52.7%	53.0%	51.0%	–
Information Technology — Pretax Profit	39.4	51.4	50.4	+28% (CC +26%)

In the Life Care business, although actual growth rates varied by product, revenue resulted with double-digit growth due to the impact of FX rates, and profitability continued to improve QoQ due to increased revenue and ongoing cost rationalization. Pretax profit declined due to factors such as the recognition of FX losses in the current quarter, compared to FX gains in the same period of the previous year. In the Information Technology business, all product lines achieved double-digit real growth, and for blanks and HDD substrates the seasonal downturn did not occur due to robust customer demand; although profit margins declined slightly due to factors such as increased depreciation expenses associated with higher capacity utilization rates, a significant increase in profit was achieved.

Product-Line Sales Growth (FY25 Q4)

Product line	Sales Growth	Constant Currency
Eyeglass Lenses	+11%	CC +2%
Contact Lenses (eyecity)	+4%	CC +4%
Endoscopes	+14%	CC +4%
IOLs	+8%	CC +1%
Artificial Bone and Other	+14%	CC +7%
LSI	+18%	CC +17%
FPD	+37%	CC +32%
HDD Substrates	+25%	CC +20%
Imaging	+30%	CC +25%

For eyeglass lenses, sales in Europe and North America were weak, but Asia and South America helped support overall performance, and the Chinese market was able to return to a growth trajectory thanks to the launch of MiYOSMART iQ (2nd generation) and increased sales of progressive lenses. For contact lenses, customer retention continued to improve thanks to private-label products and subscription services. For endoscopes, performance in Europe remained resilient supported by the successful acquisition of tender-based projects, while in the Chinese market recovery continues to take time. For IOLs, sales of monofocal lenses in Japan remained steady, while sales in the Middle East declined amid heightened geopolitical tensions involving Iran and the impact of the NVBP in China persisted.

In the Information Technology business, EUV blank sales grew as the mix of high-precision products for advanced nodes increased, supported by continued investment in leading-edge logic for AI and HPC. FPD revenue increased significantly due to the low base from the previous year and the expansion of new product development projects for smartphones and IT devices, with robust demand for foldable smartphones among major customers in China and South Korea. For HDD substrates, strong nearline HDD demand supported by robust data center investment offset seasonal headwinds; the second customer announced the launch of an 11-glass-substrate model in H2 2026 and indicated the introduction of a 12-glass-substrate model in 2027. In Imaging, momentum continued for CUPO against the backdrop of robust investment in AI data centers, alongside strong demand for lenses for wearables and in-vehicle sensing cameras.

Capacity Investment

An expansion of EUV blank production capacity was approved: construction of a new facility in Singapore, with a total investment of about ¥42bn based on current exchange rates, will start in FY26, with mass production planned for FY28. In response to expanding adoption of glass substrates, the company also decided to invest in a new factory near the existing site in Vietnam, with Phase 1 investment of roughly ¥50bn based on current exchange rates planned under a phased expansion.

FY26 Outlook

The presentation does not disclose consolidated FY26 revenue or profit guidance. By product line, the company states that in FY26 it will aim for stable growth in eyeglass lenses through the expansion of high-value-added products such as the horizontal rollout of MiYOSMART iQ and new progressive lens products; create new sales opportunities in contact lenses by advancing age-specific customer acquisition and enhancing the purchasing experience across stores and subscription services; focus on improving profitability in endoscopes while maintaining sales levels; achieve growth exceeding the market in IOLs through expanded sales of ATIOLs (trifocal/enhanced monofocal) and recovery driven by the stabilization of its supply system; expand FPD sales by increasing the product mix of high-value-added masks such as phase-shift and halftone masks; and proceed with the steady expansion of non-digital camera segments in Imaging, such as CUPO and lenses for wearables, while closely monitoring the DRAM shortage for cameras and customer inventory levels. Specific numerical FY26 forecasts cannot be confirmed from the materials.

Shareholder Returns and the New Capital Policy

The company explains that, although it implemented a significant dividend increase based on its new dividend policy and conducted two share buybacks, challenges remained regarding capital efficiency, as evidenced by the continued growth of dollar-denominated cash due to the weak yen and a net cash ratio exceeding 40%. Cash and deposits stood at ¥574.1bn at the end of FY25, with total assets of ¥1,300.9bn.

Item	Amount	Note
Cash & deposits (FY25)	574.1	¥bn; FY24 534.0, FY23 525.2, FY22 405.9, FY21 419.4
Total assets (FY25)	¥1,300.9bn	Trends in total assets and cash & deposits
Net cash, end of FY25	Approx. ¥570bn	Net cash excluding direct bank borrowings
Optimal level — working capital	~¥160bn	Around two months’ worth of monthly sales
Optimal level — shared pool	¥300bn	M&A dry powder + risk contingency funds
Excess funds	Around ¥110bn	As of the end of FY25

Under the excess cash release framework, cash and deposits exceeding the stated criteria will be released in phases, primarily through share buybacks, with the aim of optimizing the net cash level over a period of about three years. On investment, the policy is “Internal investment, first,” with plans to significantly expand production capacity for EUV blanks and HDD substrates over the medium term, while M&A will focus on small-scale bolt-ons in the eyeglass lens and contact lens sectors. On dividends, the company implements a progressive dividend policy with a payout ratio of 40%. On share buybacks, from a cash flow perspective it will return 100% of free cash flow combining dividends and share buybacks, and from a balance sheet perspective it will buy back shares over a period of about three years to optimize the cash balance. The specific dividend per share amount and the size of any new buyback program cannot be confirmed from the materials.

Strengthening the R&D Foundation

HOYA launched HOYA Incubation Laboratories (HILS) to evolve inter-company initiatives into group-wide R&D and business development, with the aim of identifying and commercializing growth drivers over the next 10 to 20 years. While business divisions will continue to conduct R&D focused on specific products, HILS will carry out development activities from a longer-term and group-wide perspective. Under the HILS roadmap, research on multiple themes will start in FY26; by around FY33 these technology seeds are to be incorporated into a structured product pipeline focused on Product Realization, after which the respective business divisions will lead the scaling of products into core businesses within HOYA.

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.