DM Solutions Q1 FY2027 Earnings Deep Dive: Record-Breaking Performance Driven by Core Business Growth and Enhanced EC Logistics Infrastructure

DM Solutions Co., Ltd. (Securities Code: 6549) has announced its financial results for the first quarter of the fiscal year ending March 31, 2027 (April 1, 2026 – June 30, 2026). Driven by the exceptional performance of its core direct mail (DM) distribution and fulfillment services, the company achieved record-high results for a first quarter across both sales and all profit levels .

This report provides an in-depth analysis of the disclosed earnings materials, focusing on 10 key topics including growth drivers, segment trends, capital investment, shareholder returns, and mid-to-long-term growth strategies.

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1. Q1 Earnings Highlights: Dramatic Growth with 57.3% Revenue Increase and Tripled Operating Profit

Consolidated results for the first quarter were as follows: Net sales of 8.298 billion yen (+57.3% YoY) , operating profit of 299 million yen (+198.0% YoY) , ordinary profit of 299 million yen (+180.4% YoY) , and quarterly net profit attributable to owners of the parent of 192 million yen (+166.7% YoY) .

Compared to the same period last year, sales increased by approximately 3 billion yen. The resulting significant growth in gross profit contributed heavily to operating profit, which surged to roughly three times the level of the previous year. The operating profit margin also improved significantly, rising from 1.9% in the same period last year to 3.6%.

2. Progress Against Full-Year Forecasts: High Achievement Rates

The progress toward the full-year earnings forecast is proceeding at a very steady and comfortable pace.

As shown in the slide above, the progress rates against the full-year plan have reached 30.2% for net sales (20.6% in the previous year), 27.2% for operating profit (10.7% in the previous year), 27.6% for ordinary profit (11.0% in the previous year), and 28.3% for quarterly net profit (11.3% in the previous year).

Notably, the progress against the first-half plan stands at 57.6% for sales, 49.4% for operating profit, and 50.6% for quarterly net profit, meaning the company has already secured approximately half of its first-half targets by the end of the first quarter. This pace is significantly higher than that of the same period last year, confirming a strong start for the current fiscal year.

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3. Analysis of Operating Profit Factors: Robust Gross Profit Growth Absorbing Upfront Investments

The increase in operating profit from 100 million yen to 299 million yen (an increase of 198 million yen, or approximately 3x) is attributed to the dramatic rise in gross profit resulting from business expansion.

As indicated in the waterfall chart above, the primary driver of operating profit growth is the increase in gross profit from the Direct Mail (DM) business (+432 million yen) . Additionally, gross profit growth in the Internet business (+9 million yen) and the Apparel business (+0.6 million yen) also contributed.

On the other hand, to support business expansion, personnel expenses increased by 154 million yen , rent expenses rose by 58 million yen due to the opening of new facilities, and other expenses increased by 29 million yen. However, the company’s high-profit structure has been proven, as it easily absorbed these upfront investments in human capital and fixed costs for new locations while achieving a substantial increase in operating profit.

4. Segment Trends (1): The Leap of the Direct Mail Business (64.5% Sales Growth, 100.2% Profit Growth)

The core Direct Mail business is driving the company's performance. Segment sales reached 7.635 billion yen (+64.5% YoY) , and segment profit reached 475 million yen (+100.2% YoY) , showing a massive increase nearing a doubling of figures.

• DM Distribution Service : The strengthening of solution proposal capabilities has borne fruit, leading to the continued acquisition of large-lot distribution orders. Simultaneously, the company has successfully maintained and acquired small-to-medium lot orders, which remain a traditional strength.
• Fulfillment Service : As demand for small-parcel delivery surges in line with the expansion of the EC market, the continuous strengthening of order-taking capacity has been successful, with orders from both new and existing customers remaining robust.

5. Expansion and Efficiency in Online DM Distribution Orders

Looking at sales trends within the DM distribution service, sales reached 6.619 billion yen in the first quarter alone. Notably, there has been an expansion in online orders via the website.

Online sales grew to 1.041 billion yen (from 943 million yen in the same period last year), and the number of orders increased to 4,827 (from 4,614). The ratio of online orders to total distribution service sales rose to 40.8% (from 38.5% in the previous year). A mechanism for efficiently capturing small-to-medium lot orders while improving sales efficiency through the strengthening of web channels has become firmly established.

6. Explosive Strengthening of Logistics Infrastructure: Opening of the "Tsurugashima Fulfillment Center"

To respond to the rapidly increasing demand for EC mail order services, the company opened the "Tsurugashima Fulfillment Center" in Hidaka City, Saitama Prefecture, which is the company's largest logistics facility (the 6th fulfillment base).

With the operation of this center, the total floor area for fulfillment services has expanded to approximately 1.45 times the previous size , dramatically improving order processing capacity. The facility is designed with the premise of introducing automated logistics equipment, strongly promoting work quality stabilization, labor saving, and productivity improvement. A multi-faceted EC logistics network has been built in coordination with existing bases such as Hino FC, Kitano-machi FC, Kunitachi FC, Utsuki FC, and Hachioji 6th FC.

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7. Segment Trends (2): Transformation of the Internet Business and Resilience of the Apparel Business

• Internet Business : Sales were 233 million yen (-14.4% YoY), and segment profit was 12 million yen (-61.7% YoY). This was impacted by the diversification of user search methods (such as the spread of SNS and AI searches), which made monetization through traditional comparison site operations difficult. However, in addition to continuing high-margin in-house media services, the company is focusing on strengthening the provision and operation of SNS consulting services , moving forward with a transformation of its business structure.
• Apparel Business (Via Transport) : Sales were 396 million yen (+10.1% YoY), and segment profit was 20 million yen (+16.1% YoY). Despite a harsh external environment characterized by a weak yen and raw material inflation, the company achieved double-digit growth in both sales and profit , supported by the strengthening of management and sales control systems and strong sales of custom-made products.

8. Challenging New Frontiers: IP Collaboration Restaurant Business at Tokyo Tower

As a new business, the company successfully launched an IP collaboration restaurant business at the " TokyoComix TokyoTower Collabo Restaurants ," which opened within Tokyo Tower in June 2026.

Through initiatives such as hosting the large-scale "CLOUD NINE TOWER" collaboration event (August 7 – September 23, 2026) with "Cloud Nine Co., Ltd.," which represents popular artists and creators, the company is creating touchpoints with entertainment IP content. The goal is to generate mid-to-long-term synergies by linking the customer touchpoints and operational know-how cultivated in this business with the company's core strengths in fulfillment and EC operation support .

9. Strengthening Shareholder Returns: Dividend Increase to 21 Yen and Shift to "Digital Gifts"

In line with the dramatic growth in performance, the company is clearly further strengthening its shareholder return stance.

• Dividend Policy : The company plans to increase the annual dividend forecast for the fiscal year ending March 31, 2027, by 3 yen from the previous year's 18 yen, to 21 yen per share annually (10.5 yen interim, 10.5 yen year-end) .
• Change in Shareholder Benefit Program : Effective from the record date of September 30, 2026, the program will shift from the traditional "QUO Card" to " Digital Gift® " (provided by Digital Plus Inc.). This allows shareholders to freely choose their preferred electronic money or points from a diverse range of options, such as Amazon Gift Cards or QUO Card Pay, significantly improving convenience (conditions based on the number of shares held and holding period remain unchanged).

10. Mid-to-Long-Term Growth Strategy and Outlook for Business Portfolio Transformation

The mid-to-long-term vision envisioned by the company is to integrate its existing infrastructure and know-how in "DM distribution," "fulfillment," and "internet" to diversify and shift its business domain into the growing "EC-related services" market .

As shown in the slide above (Future Growth Image), the company is proceeding with the selection and concentration of management resources, investing intensively across departmental boundaries into EC-related areas (EC business support, D2C support, EC support, Web-integrated DM) and "Anime/Character IP Business Support."

In the profit composition image for three years from now, the company aims for a portfolio where a group of businesses surrounding the EC domain—such as fulfillment, EC-related services, apparel, and IP support—are significantly expanded and layered on top of the stable earnings from the foundation of the direct mail distribution business. The story of enhancing corporate value over the mid-to-long term through the fusion of logistics and marketing is being steadily promoted.