Daiichi Sankyo Company (4568) Q1 2027 earnings summary

Executive summary

• Q1 FY2026 revenue rose 21.1% year-over-year to JPY 574.7 billion, driven by strong sales of ENHERTU and DATROWAY and favorable foreign exchange effects.

• Core operating profit increased 6.2% to JPY 107.3 billion, but operating profit fell 12.0% to JPY 85.1 billion due to higher restructuring expenses in the EU Specialty Business Unit and non-core costs.

• Profit attributable to owners declined 19.7% to JPY 68.6 billion, mainly due to higher income taxes and financial expenses.

• Correction of FY2025 results due to booking errors in accounts payable and SG&A; internal controls reviewed and strengthened.

• Total comprehensive income rose 28.5% to JPY 87.7 billion, reflecting positive currency translation differences.

Financial highlights

• Q1 FY2026 revenue increased by JPY 100.1 billion year-over-year, with a JPY 41.9 billion positive forex impact.

• Core operating profit up JPY 6.3 billion (6.2% YoY) to JPY 107.3 billion; operating profit down JPY 11.6 billion (12.2% YoY) to JPY 85.1 billion.

• Profit attributable to owners dropped JPY 16.9 billion YoY to JPY 68.6 billion; EPS down 18.1% to JPY 37.72.

• Cost of sales rose 43.9% YoY to JPY 126.0 billion; SG&A up 25.5% to JPY 226.0 billion, mainly from higher profit sharing with AstraZeneca.

• R&D expenses grew 9.0% to JPY 115.5 billion, reflecting intensified investment in ADCs and pipeline projects.

Outlook and guidance

• FY2026 revenue forecast raised to JPY 2.34 trillion, mainly due to yen depreciation and strong ENHERTU sales.

• Operating profit forecast raised to JPY 320 billion, reflecting reversal of Odawara site provision.

• Core operating profit guidance unchanged at JPY 360 billion; profit attributable to owners forecast at JPY 251 billion, with EPS revised down to JPY 137.94 due to higher tax rate and SG&A.

• Annual dividend forecast increased to JPY 100 per share, up JPY 22 from the prior year.

• Forex assumptions: JPY 155/USD, JPY 180/EUR for Q2 onward.