Furukawa Electric (5801): FY2025 Results Summary — Data Center Demand Lifts Operating Profit 36%

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

Furukawa Electric Co., Ltd. reported FY2025 (fiscal year ended March 31, 2026) net sales of JPY 1,307.6 billion, up 9% year on year, with operating profit of JPY 63.9 billion (up 36%), ordinary profit of JPY 75.9 billion (up 56%) and profit attributable to owners of parent of JPY 72.5 billion (up 117%). The company attributed the increase in profit on higher revenue to increased demand for data center related products, and operating profit came in JPY 7.9 billion above the previous forecast announced on February 9, 2026, with all segments exceeding that forecast. The company also stated that it achieved the financial targets in the 2025 Mid-term Plan. For FY2026 it forecasts net sales of JPY 1,460.0 billion and operating profit of JPY 95.0 billion.

Consolidated Results (Full-Year Actual)

Net sales rose JPY 105.8 billion year on year to JPY 1,307.6 billion, which the materials attribute to increased profit on higher revenue in all segments and the impact of soaring copper prices. The operating margin improved to 4.9% from 3.9%. Ordinary profit of JPY 75.9 billion reflected strong results at entities accounted for using the equity method (share of profit of JPY 16.5 billion). Extraordinary income (losses) of JPY 29.1 billion included a gain on the revision to the retirement benefit plan and decreased recording of provision for product warranties. The average copper price was JPY 1,695/kg and the average exchange rate was JPY 151/USD.

Item (JPY billion)	FY24 Results	FY25 Previous Forecasts	FY25 Results	YoY change	Change from previous forecasts
Net sales	1,201.8	1,300.0	1,307.6	+105.8	+7.6
Operating profit	47.0	56.0	63.9	+16.8	+7.9
(Margin)	3.9%	4.3%	4.9%	+1.0	+0.6
Share of profit (loss) of entities accounted for using equity method	10.6	－	16.5	+5.9	－
Ordinary profit	48.5	65.0	75.9	+27.4	+10.9
(Margin)	4.0%	5.0%	5.8%	+1.8	+0.8
Extraordinary income (losses)	5.5	16.5	29.1	+23.6	+12.6
Profit attributable to owners of parent	33.4	54.0	72.5	+39.2	+18.5
(Margin)	2.8%	4.2%	5.5%	+2.8	+1.4
Average copper price (JPY/kg)	1,478	1,694	1,695	+217	+1
Average exchange rate (JPY/USD)	153	149	151	(2)	+2

On the balance sheet, total assets increased by JPY 78.3 billion to JPY 1,066.4 billion at the end of FY25Q4. The equity capital ratio improved to 39.1% from 34.6%, the net D/E ratio fell to 0.59 from 0.72, and ROE rose to 19.1% from 10.0%. Net interest-bearing debt was JPY 247.5 billion. Free cash flow was JPY (19.0) billion in FY25 versus JPY +52.6 billion in FY24, with operating cash flow of JPY +28.1 billion and investing cash flow of JPY (47.1) billion.

Segment Results

FY25 operating profit exceeded the previous forecast in all segments. Communications Solutions swung to an operating profit of JPY 11.8 billion from a loss of JPY (4.1) billion, on increased sales of data center related products and the impact from new consolidations. Electronics Component Materials posted increased profit on higher revenue on a gradual recovery in demand and improvement in the product mix. Automotive Products & Batteries recorded increased profit on lower revenue, reflecting slightly increased sales for Japan and price optimization against decreased sales of batteries and the deconsolidation of the battery business from Q4 onward; the materials put the impact of that deconsolidation at approximately JPY (21.0) billion of net sales and approximately JPY (2.0) billion of operating profit. Functional Products delivered increased profit on higher revenue on increased sales of data center related products, while Service and Developments, etc. saw decreased profit on higher revenue due to increased expenses incurred for launching new businesses.

Segment (JPY billion)	Net sales FY24	Net sales FY25	Net sales YoY	Operating profit FY24	Operating profit FY25	Operating profit YoY
Infrastructure	309.1	370.9	+61.8	5.7	21.4	+15.7
Communications Solutions	167.0	229.3	+62.3	(4.1)	11.8	+15.9
Energy Infrastructure	142.1	141.6	(0.5)	9.8	9.6	(0.2)
Electronics & Automotive Systems	736.4	765.1	+28.6	32.6	33.9	+1.3
Automotive Products & Batteries	409.5	397.8	(11.7)	27.6	28.0	+0.4
Electronics Component Materials	327.0	367.3	+40.3	5.0	5.9	+0.9
Functional Products	147.0	161.1	+14.1	14.1	15.4	+1.3
Service and Developments, etc.	34.8	42.2	+7.4	(5.4)	(6.7)	(1.3)
Elimination of intra-company transactions	(25.6)	(31.7)	(6.1)	(0.1)	(0.1)	(0.1)
Total	1,201.8	1,307.6	+105.8	47.0	63.9	+16.8

FY2026 Forecast

For FY26 the company forecasts net sales of JPY 1,460.0 billion (up 12%), operating profit of JPY 95.0 billion (up 49%), ordinary profit of JPY 100.0 billion (up 32%) and profit attributable to owners of parent of JPY 82.0 billion (up 13%), assuming an average copper price of JPY 2,000/kg and an average exchange rate of JPY 150/USD. Growth of data center related products is cited as the driver, including plans to start mass production of water-cooled module products (scheduled in June 2026), net sales growth of rollable ribbon cable, MT ferrules and optical semiconductor products (DFB laser chips, etc.), and a shift in the product mix of copper foil products. The company notes that the impact of the tense situation in the Middle East — increases in raw material and transportation costs, primarily synthetic resins, and changes in customer demand — has not been reflected in the FY2026 forecast because it is currently not possible to reasonably estimate it.

Item (JPY billion)	FY25 Results	FY26 Forecasts	YoY change
Net sales	1,307.6	1,460.0	+152.4
Operating profit	63.9	95.0	+31.1
(Margin)	4.9%	6.5%	+1.6
Ordinary profit	75.9	100.0	+24.1
(Margin)	5.8%	6.8%	+1.0
Extraordinary income (losses)	29.1	21.0	(8.0)
Profit attributable to owners of parent	72.5	82.0	+9.5
(Margin)	5.5%	5.6%	+0.1
Average copper price (JPY/kg)	1,695	2,000	+305
Average exchange rate (JPY/USD)	151	150	(1)
CAPEX	56.7	150.0	+93.3
Depreciation and amortization	43.2	46.0	+2.8
R&D expenses	28.4	30.0	+1.6

From FY2026 the organization has been reorganized into 6 new segments with a market-based structure, in order to strengthen the management structure and accelerate growth in the data center domain. The FY26 forecast is presented on this new basis, with FY25 figures restated accordingly. FY2025 results of the Battery business (consolidated until FY2025 Q3) have been included in Service and Developments, etc.; the impact of the deconsolidation of the batteries business is given as approximately JPY (59.0) billion of net sales and approximately JPY (1.8) billion of operating profit.

New segment (JPY billion)	Net sales FY25	Net sales FY26 Forecast	Net sales YoY	Operating profit FY25	Operating profit FY26 Forecast	Operating profit YoY
Optical Solutions	196.9	240.0	+43.1	10.7	27.0	+16.3
Digital Infrastructure Components	198.0	310.0	+112.0	15.9	39.0	+23.1
Energy Infrastructure	138.8	130.0	(8.8)	10.0	7.0	(3.0)
Automotive Systems	357.5	360.0	+2.5	26.4	23.0	(3.4)
Metal Solutions	372.9	445.0	+72.1	3.4	4.0	+0.6
Service and Developments, etc.	105.8	50.0	(55.8)	(2.4)	(5.0)	(2.6)
Elimination of intra-company transactions	(62.5)	(75.0)	(12.5)	(0.2)	0.0	+0.2
Total	1,307.6	1,460.0	+152.4	63.9	95.0	+31.1

Shareholder Returns

The company plans to issue a dividend of JPY 210 per share in FY25, an increase of JPY 50 from the dividend of JPY 160 announced on February 9, 2026, and forecasts a dividend of JPY 220 per share in FY26, when it also plans to reinstate an interim dividend. A 10-for-1 split of common shares will be implemented effective July 1, 2026; the materials note that the annual dividend per share taking into account the impact of the stock split would be JPY 22. The shareholder return policy has also been changed: whereas the basic policy had been to provide stable and continuous returns and link dividend payments to business performance with a target of 30% of profit attributable to owners of parent, during the Vision 2030 period (FY2026–FY2030) the company aims to maintain stable shareholder returns while continuing investments to enhance corporate value, with dividends generally targeting 3.5% of shareholders’ equity.

Item	FY21	FY22	FY23	FY24	FY25 (planned)	FY26 (forecast)
Annual dividend per share (JPY)	60	80	60	120	210	220
Dividend payout ratio	41.8%	35.4%	64.9%	25.4%	20.4%	18.9%
DOE	－	－	－	－	3.9%	3.5%
Profit attributable to owners of parent (JPY billion)	10.1	15.9	6.5	33.4	72.5	82.0

Medium-Term Plan

The company states that it achieved the financial targets in the 2025 Mid-term Plan, whose targets were announced on May 26, 2022. FY25 results exceeded every target, with ROIC (after tax) of 12.2% against a target of more than 6%, ROE of 19.1% against more than 11%, and net income attributable to owners of the parent of JPY 72.5 billion against more than JPY 37.0 billion.

Metric	FY25 Results	Target (announced May 26, 2022)
ROIC (after tax)	12.2%	More than 6%
ROE	19.1%	More than 11%
Net D/E ratio	0.6	0.8 or below
Capital ratio	39.1%	More than 35%
Net sales	JPY 1.3 trillion	More than JPY 1.1 trillion
Operating profit	JPY 63.9 billion	More than JPY 58.0 billion
Net income attributable to owners of the parent	JPY 72.5 billion	More than JPY 37.0 billion

FY26 CAPEX is forecast at JPY 150.0 billion, up JPY 93.3 billion from JPY 56.7 billion in FY25, with heat dissipation and cooling products at about JPY 45.0 billion, HVDC related at about JPY 16.0 billion and DFB laser related at about JPY 7.0 billion. R&D expenses are forecast at JPY 30.0 billion.

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.