Kokopelli Inc. Q1 FY2027 Earnings Deep Dive: Return to Profitability Driven by Global Investment Completion and Expansion of Financial DX Solutions

This report provides a comprehensive analysis of the Q1 FY2027 earnings for Kokopelli Inc. (Ticker: 4167), covering key performance highlights, shifts in revenue structure, growth drivers by product, and the company's future global and AI strategies.

---

1. Q1 FY2027 Earnings Highlights: Achieving a V-Shaped Recovery to Profitability

In the first quarter, Kokopelli achieved net sales of 481 million yen (+9.3% YoY) , EBITDA of 58 million yen (+574.3% YoY) , and operating profit of 8 million yen (a turnaround from a 48 million yen loss in the same period last year) . This performance was driven by the completion of large-scale upfront investments in the global platform "BIG ADVANCE GLOBAL," the steady performance of the core "Big Advance" business, and the expanded adoption of DX Solutions for financial institutions.

The following slide summarizes the consolidated financial results and key KPIs for "Big Advance" during this quarter.

As shown in these highlights, in addition to steady revenue growth, profitability metrics such as EBITDA and operating profit have recovered significantly. The foundation of the flagship platform, "Big Advance," remains highly stable, maintaining 72 participating financial institutions , 52,203 member companies , and a total user base of 219,284 . Furthermore, the average churn rate—the most critical metric for a SaaS business model—remains low at 1.52% , confirming that the customer base provides a solid foundation for revenue.

---

2. Analysis of Performance Trends and Revenue Structure: Maintaining Stock Revenue and the Mechanism of Rapid Profit Recovery

Looking at the quarterly performance trends, net sales reached a record high of 481 million yen , maintaining a continuous growth trajectory. The stock revenue ratio remains high at 76% , demonstrating the robustness of the subscription-based business model that accumulates stable monthly revenue.

Regarding profitability, the completion of the large-scale investments made last year for the development and international expansion of "BIG ADVANCE GLOBAL" has led to a dramatic shift. The following chart of quarterly operating profit/loss and EBITDA clearly illustrates the transition from the investment phase to the recovery and monetization phase.

An essential background factor visible in this graph is that operating losses had temporarily expanded due to intentional, concentrated upfront investments throughout FY2026 (particularly Q2–Q4) . In this first quarter, the completion of these development and infrastructure investments significantly reduced the cost burden, returning the company to a profit structure where revenue growth translates directly into earnings. Specifically, operating profit improved by 56 million yen from a 48 million yen loss in the same period last year to an 8 million yen profit, restoring profitability beyond the break-even point.

A detailed breakdown of the EBITDA increase shows that in addition to a 41 million yen boost from increased sales , the company benefited from a 11 million yen reduction in personnel costs due to productivity improvements from generative AI, and an 18 million yen efficiency gain in other expenses. These factors more than absorbed the 20 million yen increase in outsourcing costs, resulting in a total EBITDA increase of 49 million yen (rising from 8 million yen to 58 million yen YoY).

---

3. Segment and Product Topics: Rapid Growth of DX Solutions and Full-Scale AI Strategy

Kokopelli's business portfolio consists of two main pillars: the core management support platform for SMEs, "Big Advance," and "DX Solutions," which supports operational efficiency for financial institutions and SMEs. This quarter saw particularly remarkable results in the DX Solutions segment.

The following slide shows the trend in new adoptions for DX/AX solutions for financial institutions.

This slide highlights that the company's growth engine is no longer limited to "Big Advance" alone, but has diversified into a range of financial DX tools, including "BM Portal," "SAF," and "WebFile/GrpMail."

• BM Portal (Business Matching Management Tool) : Newly adopted by two banks, including Ashikaga Bank and Akita Bank, expanding to a total of 5 financial institutions .
• SAF (Specialized AI FAQ) : Newly adopted by four institutions, including Kochi Bank, Shiga Chuo Shinkin Bank, Chunichi Shinkin Bank, and Nishichugoku Shinkin Bank, reaching a total of 9 financial institutions . This captures the demand for using generative AI to significantly reduce the burden of responding to internal inquiries regarding operational regulations.
• WebFile / GrpMail (File Transfer/Sharing Service) : Gained two new clients, including Shiba Shinkin Bank and Chugin Lease, expanding to a total of 6 financial institutions .

Furthermore, innovation to enhance product value within the existing "Big Advance" platform is accelerating. This quarter saw the release of the AI agent "BiBi." "BiBi" is an AI assistant that autonomously supports member companies by identifying potential business partners, automatically drafting business matching needs, and reminding users of unaddressed negotiations. This is expected to lower the barrier to entry for user companies and improve matching success rates.

---

4. Progress in Global Strategy and Alignment with National Policy

BIG ADVANCE GLOBAL Deployment and Next Steps

Launched in March 2026 between Japan and Thailand, "BIG ADVANCE GLOBAL" is the first domestic global matching platform supporting overseas expansion and direct trade for local SMEs. In Q1, the company secured 490 member companies on the Japanese side (15 matching needs registered) and 18 POC (free) member companies on the Thai side (8 needs registered) .

While initial member acquisition was somewhat gradual due to the time required to establish registration and approval operations in Thailand, the company plans to strengthen collaboration with Krungthai Bank and Thai government agencies (OSMEP/ISMED) from Q2 onwards to accelerate local acquisition. Regarding monetization, the company plans to introduce success fees for matching on the Japanese side from Q3 and paid subscriptions for Thai member companies in Q4 , incorporating a phased monetization approach.

Alignment with the Government's "Regional Financial Strength Enhancement Plan"

The "Regional Financial Strength Enhancement Plan," formulated and published by the Financial Services Agency in December 2025, is a comprehensive policy package that encourages regional financial institutions to go beyond simple financing to improve corporate value and support DX. The solution suite promoted by Kokopelli, including "Big Advance," "BIG ADVANCE GLOBAL," and "BM Portal," directly aligns with key items in the plan, such as "supporting the growth of SMEs through collaboration with domestic and international players" and "promoting DX support for regional companies," providing a strong tailwind for adoption among regional financial institutions.

---

5. Earnings Forecast, Future Outlook, and Summary

Against the full-year earnings forecast for FY2027, net sales are progressing steadily as of Q1, and achieving profitability in operating income serves as an important stepping stone for future revenue expansion.

Kokopelli's future growth story can be summarized in three points:

1. A stable stock revenue base from "Big Advance" and a solid baseline built through a lower churn rate.
2. Acceleration of revenue growth and increased ARPU (Average Revenue Per User) through cross-selling high-value financial DX solutions such as "BM Portal" and "SAF."
3. Maximization of long-term platform value through the implementation of generative AI features (such as BiBi) and the monetization of "BIG ADVANCE GLOBAL."

With the investment phase of the previous fiscal year complete and the company's profit-generating capacity restored, attention will be focused on how the company will grow as a DX/AX partner for regional financial institutions and SMEs, particularly regarding future product development and global expansion progress.