COVER (5253) investor relations material

Executive summary

• Q1 FY2027/3 revenue was 8,825 million yen, down 8.3% year-over-year, with net profit at 415 million yen, down 40.1% year-over-year; declines in Streaming/Content and Merchandising were offset by growth in Concerts/Events and Licensing/Collaborations.

• Operating profit fell 33.0% year-over-year to 651 million yen, reflecting increased fixed costs during an investment phase.

• The company is investing in business infrastructure and organizational structure to support sustainable growth, temporarily raising the fixed cost ratio and lowering operating margin.

• Launched new talent development project "mekPark" and released the first smartphone game "hololive Dreams," which surpassed 2 million downloads post-launch.

Financial highlights

• Revenue: 8,825 million yen (-8.3% YoY); Gross profit: 4,493 million yen (-8.4% YoY); Operating profit: 651 million yen (-33.0% YoY); Net profit: 415 million yen (-40.1% YoY).

• Ordinary profit decreased 35.8% year-over-year to 598 million yen.

• Basic earnings per share for the quarter were 6.38 yen, compared to 10.57 yen a year earlier.

• Total assets at quarter-end were 28,088 million yen, down from 34,908 million yen at the previous fiscal year-end; net assets decreased to 17,379 million yen from 19,964 million yen.

• Merchandising revenue dropped 22.1% YoY due to product mix and operational issues.

Outlook and guidance

• Q2 initiatives include leveraging the smartphone game launch, expanding overseas events, and boosting merchandising tied to summer campaigns.

• Full-year revenue forecast is 51,350 million yen, up 4.1% year-over-year; operating profit forecast is 7,000 million yen, nearly flat year-over-year (-0.8%); net profit for the year is projected at 4,900 million yen, up 62.4% year-over-year.

• No changes to the previously disclosed full-year forecast.

• Medium-term targets: 100 billion yen revenue and 25 billion yen operating profit by FY2030/3.