【In-Depth Earnings Report】Core Concept Technology (4371) Q2 FY2026: Growth Story Driven by Accelerated DX Support and Record-High Sales

The Q2 FY2026 earnings results for Core Concept Technology (CCT) demonstrate a strong performance, with both revenue and operating profit exceeding company forecasts , primarily driven by its core DX Support business . Quarterly revenue has reached a record high , and the order backlog , a leading indicator of future growth, has expanded significantly by +23.3% year-on-year .

This report provides a comprehensive analysis of the detailed financial data, segment trends, key KPIs, and notable topics disclosed in the earnings materials to unravel the company's business status and growth narrative.

---

1. Overview of H1 FY2026 Financial Results

The consolidated results for the first half of FY2026 (January to June 2026) show that both revenue and profit at all levels surpassed the same period last year, with steady progress toward the full-year targets.

• Revenue : 11,343 million JPY (+11.6% YoY / 49.3% progress toward full-year target)
• Gross Profit : 3,093 million JPY (+11.3% YoY / 48.8% progress toward full-year target)
• Operating Profit : 1,148 million JPY (+7.0% YoY / 47.3% progress toward full-year target)
• Ordinary Profit : 1,171 million JPY (+9.0% YoY / 47.8% progress toward full-year target)
• Quarterly Net Profit : 520 million JPY (-31.7% YoY / 39.1% progress toward full-year target)
• Adjusted Net Profit : 817 million JPY (+7.2% YoY / 48.5% progress toward full-year target)

The significant decline in quarterly net profit is due to a one-time, lump-sum accounting treatment for trust-type stock option-related losses (296 million JPY) recorded in Q1. Excluding this special factor, the adjusted net profit stands at 817 million JPY (+7.2% YoY) , indicating that the company's underlying earning power is growing steadily.

Regarding operating profit fluctuations, the increase in revenue contributed significantly ( +1,175 million JPY ), while these gains were partially offset by increased outsourcing costs (-735 million JPY) due to project expansion, higher personnel costs (-172 million JPY) from increased headcount, and recruitment expenses (-43 million JPY) .

---

2. Performance by Service Segment and Order Backlog Trends

CCT's business consists of two pillars: "DX Support," where it contracts directly with end-users, and "IT Talent Procurement Support," which addresses the IT staffing needs of major system integrators. The H1 results are as follows:

Slide Commentary: Performance by Service Segment and Order Backlog (P-8)

This slide provides critical data illustrating the engines driving the company's growth and how the "stock" that supports future revenue is accumulating.

• Rapid Expansion of DX Support : Revenue reached 5,704 million JPY (+19.1% YoY) , and gross profit was 2,124 million JPY (+13.9% YoY) , strongly driving overall growth. The gross profit margin remains high at 37.2% .
• Stability of IT Talent Procurement Support : Revenue was 5,639 million JPY (+4.8% YoY) , and gross profit was 968 million JPY (+5.9% YoY) , with the gross profit margin improving by 0.2 percentage points year-on-year to 17.2% .
• Significant Increase in Order Backlog : The total company order backlog reached 4,768 million JPY (+23.3% YoY) . Notably, the DX Support backlog grew to 2,696 million JPY (+31.8% YoY) , providing strong backing for performance in the second half and beyond.

---

3. Quarterly Performance Trends and Seasonal Factors

Looking at quarterly revenue trends, the growth momentum becomes even clearer.

Slide Commentary: Quarterly Revenue Trends (P-9)

As clearly shown in the graph above, Q2 FY2026 quarterly revenue reached 5,905 million JPY , marking a record high on a quarterly basis . Both DX Support ( 3,011 million JPY ) and IT Talent Procurement Support ( 2,894 million JPY ) achieved significant revenue growth quarter-on-quarter (QoQ).

Meanwhile, looking at the quarterly operating profit margin (Materials P-10–11), Q2 (April–June) was 9.3% , lower than Q1 (11.0%). However, this is not a structural deterioration but rather due to clear seasonal factors . CCT welcomes many new graduates every April, and personnel and training costs related to new graduate training are concentrated in the April–June period (these are reclassified to cost of sales after assignment to projects from July onwards). While recruitment-related expenses and some unprofitable projects also had a temporary impact, the company's progress remains slightly ahead of plan even when accounting for these costs.

---

4. Core Growth KPIs: Customer Base Expansion and Talent Acquisition

CCT's sustainable growth is supported by two major drivers: "scaling up customers" and "strengthening the talent base."

(1) Customer Base Trends and Project Upsizing

CCT employs a strategy of increasing repeat business and raising project scale by enhancing customer satisfaction.

Slide Commentary: Increase in Large-Scale Customers (P-18)

This slide visually proves CCT's high repeat rate and the "upward shift in customer unit price."

• Expansion of Total Customer Base : The number of customers has steadily increased from 336 in Q2 2024 and 437 in Q2 2025 to 455 in H1 2026.
• Surge in Potential Large-Scale Customers (10M–100M JPY) : While ultra-large customers (over 100M JPY) remain flat at 28, customers in the 10M–50M JPY range increased to 110 (from 96 YoY) , and those in the 50M–100M JPY range increased to 19 (from 15 YoY) , showing a steady pipeline of large-scale clients. Revenue from existing customers accounts for approximately 90% of the total, indicating that a cross-selling and up-selling structure based on customer satisfaction is functioning effectively.

(2) Employee Trends and Productivity

CCT is also achieving steady results in "talent acquisition," which often acts as a growth bottleneck in the IT industry.

• Group Employees : Expanded to 673 consolidated (481 non-consolidated) as of the end of Q2 2026.
• Strengthening New Graduate Recruitment : Recorded 92 new hires (74 non-consolidated) for the 2026 fiscal year. The company focuses on hiring individuals with excellent logical thinking and communication skills with an eye toward future Project Managers (PMs), not just programming aptitude. The ratio of liberal arts majors and female employees has increased (the female ratio is approximately 2.7 times the usual level).
• Productivity : Revenue per employee (quarterly) remains at a high level and shows an upward trend QoQ, despite the dilutive effect of mass new graduate hiring, thanks to skill upgrades and higher unit prices.

---

5. Notable Topic: Status of Collaboration Discussions with SYGMAXIS HOLDINGS

Regarding capital and business developments, the company has disclosed its recognition and policy concerning shareholdings by SYGMAXIS HOLDINGS, INC. (Materials P-15).

• Shareholding Status : As of July 10, 2026, SYGMAXIS holds 16.03% (based on voting rights) of CCT shares.
• Company Recognition and Policy : While stating that CCT has not agreed to share acquisitions up to the equity-method affiliate level, it noted that "constructive discussions on collaboration are underway as mutual complementary effects can be expected in business." Although there is no current agreement on a capital and business alliance, the company intends to continue exploring mutually beneficial business collaborations while maintaining management autonomy and independence .

---

6. Long-Term Strategy and Solution Strengths

CCT's particular strength in the DX support domain lies in its end-to-end support system for industries with "manufacturing and on-site operations," such as manufacturing, construction, and logistics.

It focuses on the following three solutions to drive project scaling:

1. MES (Manufacturing Execution System) : Deploys its proprietary Orizuru MES to support equipment integration, motion monitoring, and the construction of 24-hour automated lines (e.g., Yokowo's smart factory construction).
2. ERP (Enterprise Resource Planning) : Revamping core systems using mcframe, combining standard function application with high-speed agile development (e.g., Nippon Butyl Co., Ltd.).
3. PLM (Product Lifecycle Management) : Using Aras Innovator to realize concurrent operations by linking design information (EBOM) and manufacturing information (MBOM) (e.g., Comany Inc.).

By utilizing its proprietary common technology platform Orizuru and the business matching/procurement platform Ohgi, the company enables improved development efficiency and large-scale team formation, which are the sources of its high profitability and customer satisfaction.

---

7. Summary of Earnings and Future Outlook

Through the Q2 FY2026 earnings, it is confirmed that Core Concept Technology's growth story is progressing very smoothly .

• Solid Performance : Both revenue and operating profit are exceeding plans , and adjusted net profit maintains year-on-year growth.
• Strong Leading Indicators : The order backlog is up +23.3% YoY , providing a solid foundation for second-half performance.
• Expansion of Growth Foundation : Talent acquisition, including 92 new graduates, is progressing, and the layer of mid-sized customers in the 10M–100M JPY range is thickening.

By appropriately assessing the impact of temporary stock option expenses and seasonal training costs, it can be concluded that these results accurately reflect the company's inherent earning power and high market demand.