Square Enix (9684) Q4 2026 earnings summary

Executive summary

• Net sales for the fiscal year ended March 31, 2026, were ¥297.6 billion, down 8.3% year-over-year, while operating income rose 34.9% to ¥54.7 billion and ordinary income surged 57.5% to ¥64.4 billion, driven by improved profitability in Digital Entertainment.

• Profit attributable to owners of parent increased 21.3% to ¥29.6 billion, despite ¥12.1 billion in reorganization costs.

• Comprehensive income rose 21.5% to ¥30.7 billion.

• Foreign exchange gains of ¥7.2 billion contributed to higher ordinary income.

• Ordinary income and operating margins saw significant improvement compared to the previous fiscal year.

Financial highlights

• Operating margin improved to 18.4% from 12.5% year-over-year.

• Cash and cash equivalents at year-end were ¥275.8 billion, up ¥32.2 billion from the prior year.

• Net assets rose 3.8% to ¥349.2 billion; equity ratio was 79.6%.

• Earnings per share (basic) were ¥82.15, up from ¥67.79, reflecting a stock split.

• Return on equity increased to 8.7% from 7.5% year-over-year.

Outlook and guidance

• FY ending March 31, 2027 forecasts: net sales ¥298.0 billion (+0.1%), operating income ¥49.0 billion (–10.5%), ordinary income ¥49.0 billion (–24.0%), profit attributable to owners of parent ¥31.0 billion (+4.7%), EPS ¥85.99.

• Targeting a consolidated operating margin of 15% and ROE of at least 10% by FY27.

• Dividend policy maintains a payout ratio of 30%, with a projected annual dividend of ¥43 per share for FY27.

• Management notes forward-looking statements are subject to risks including economic conditions, currency fluctuations, and competitive market dynamics.

• Market risks include rapid changes in consumer demand, digital transformation, and global competition.