Earnings Deep Dive: Piers Inc. (7066) Q3 FY2026 Results: Record-High Revenue and Profits, and the Strategic Restructuring via New Entity 'NAJIM works'

Based on the financial materials for the cumulative third quarter of the fiscal year ending September 2026 for Piers Inc. (Securities Code: 7066), this report provides a comprehensive analysis of the company's performance highlights, progress against full-year targets, financial structure, mid-to-long-term growth strategies through group reorganization, and shareholder return policies.

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1. Consolidated Performance Highlights: Record-High Revenue and Ordinary Profit

The consolidated results for the first nine months of the fiscal year ending September 2026 (October 1, 2025, to June 30, 2026) demonstrated exceptionally strong growth in both revenue and intermediate profit metrics.

• Revenue : ¥5.498 billion ( +22.1% YoY)
• Gross Profit : ¥1.601 billion ( +22.4% YoY)
• Operating Profit : ¥396 million ( ±0.0% YoY)
• EBITDA : ¥617 million ( +12.8% YoY)
• Ordinary Profit : ¥465 million ( +28.8% YoY)
• Net Profit Attributable to Owners of Parent : ¥258 million ( -18.9% YoY)

Analysis of Performance Factors

Revenue and gross profit saw a robust increase of over 20% year-on-year, driven by the steady expansion of core sales promotion support for retail stores and online sales businesses, as well as contributions from subsidiaries acquired through M&A.

While operating profit remained flat compared to the same period last year, this was the result of absorbing increased goodwill amortization expenses associated with aggressive M&A activities (goodwill balance increased to ¥834 million). However, EBITDA , which reflects the business's cash-generating capability, grew steadily to ¥617 million (+12.8%) .

Ordinary profit achieved a significant increase of +28.8% to ¥465 million, bolstered by one-time investment-related gains. Conversely, the decline in net profit is attributed to the emergence and increase of corporate tax expenses following the exhaustion of past tax loss carryforwards; on a pre-tax basis, net profit actually represents a +24.8% increase year-on-year.

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2. Progress Against Revised Full-Year Forecasts and Financial Foundation

As of the end of the third quarter, progress against the revised full-year earnings forecast is tracking at a high level, with many profit items exceeding or pacing well ahead of the plan.

Significance and Interpretation of the Progress Slide

The slide above illustrates the achievement rate of the cumulative Q3 results against the revised full-year forecast for FY2026. Revenue stands at ¥5.498 billion (70% progress) against the full-year target of ¥7.80 billion. Given the company's tendency for revenue to skew toward the fourth quarter and the strong progress in profit items, this trajectory is considered favorable.

Regarding profits, operating profit reached ¥396 million (89% progress) against the ¥445 million target, and EBITDA reached ¥617 million (88% progress) against the ¥700 million target, both nearing the 90% mark by the end of Q3. Furthermore, ordinary profit has already exceeded the full-year plan , reaching ¥465 million (109% progress) against the ¥425 million target. While this includes one-time investment gains, the underlying progress rate remains at approximately 93% , indicating a very high probability of achieving the full-year goals.

Balance Sheet (B/S) and Improved Financial Soundness

The financial foundation is also improving. Total assets as of the end of June 2026 were ¥4.268 billion, while liabilities were reduced (total liabilities decreased by ¥256 million from the end of the previous fiscal year to ¥1.441 billion). Consequently, total net assets rose to ¥2.827 billion, and the equity ratio improved from 61.9% at the end of the previous fiscal year to 66.2% (+4.3 points) . By controlling interest-bearing debt and accumulating retained earnings while actively pursuing M&A, the company has secured sufficient capital capacity for future growth investments.

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3. Group Reorganization: Launch of 'NAJIM works' and Business Synergies

The Piers Group is executing structural reforms and organizational restructuring to achieve sustainable growth and further improve management efficiency.

Explanation and Objectives of the Group Reorganization

Piers announced plans to integrate two consolidated subsidiaries, Qualiagram Inc. and 2Links Inc. , into a new company, 'NAJIM works Inc.' , effective October 1, 2026 (the beginning of the fiscal year ending September 2027).

This reorganization is a strategic approach aimed at merging 'advanced technology' with 'service operation capabilities for consumers.'

• Qualiagram : Specializes in AI implementation and dialogue design , including communication AI, AI operators, and AI avatar customer service UIs.
• 2Links Inc. : Possesses digital content operation and revenue bases for consumers, including seniors, through services like 'Shittoku Contents' and 'Zero-kara AI.'

By integrating these two companies, the group forms a unified entity capable of providing end-to-end support—from AI product development ('creation') to on-site implementation, talent training, customer support, and retention ('utilization'). Under the service concept, 'Making new experiences a part of daily life,' the company is poised to strongly promote the social implementation of AI solutions.

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4. Growth Strategy of NAJIM works: Market Expansion from toC to toB and toG

With the launch of 'NAJIM works,' a clear expansion strategy for services and target markets has been presented.

Interpretation of the Growth Strategy Slide: Deployment Across Three Domains (toC, toB, toG)

The slide above illustrates the TAM (Total Addressable Market) targeted by NAJIM works, the domain-specific approaches, and the revenue growth image of the digital content business.

1. toC (Consumer) Domain : Targets approximately 36.2 million seniors aged 65 and over and non-internet users. It secures stable customer touchpoints and revenue sources through services like NTT Docomo's 'd Value Pass' and senior-focused AI support 'Zero-kara AI.'
2. toB (Corporate) Domain : Targets approximately 15,000 companies with 300+ employees to promote DX in stores and reception areas. The AI customer service solution 'MANAMI' has already been adopted for guidance tasks at events like the Osaka-Kansai Expo , and the company is capturing demand for AI avatars and operators.
3. toG (Government/Public) Domain : Targets approximately 1,700 local governments nationwide to address the digital divide and support government DX. The company is entering government-contracted projects, such as digital literacy support for the elderly.

By applying the high-quality operational and support know-how cultivated in the BtoC sector to BtoB and BtoG, the company plans to overcome the impact of the temporary divestiture of its private booth business and achieve results exceeding the previous year, setting a trajectory for mid-to-long-term expansion .

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5. Strengthening Shareholder Returns: Completion of Share Buybacks and Progressive Dividend Policy

In parallel with investments in business growth, Piers is implementing proactive shareholder return policies to enhance shareholder value.

Completion of ¥100 Million Share Buyback

To improve capital efficiency (EPS/ROE) and execute flexible capital policies, the company completed a share buyback of approximately ¥100 million (total acquisition cost of ¥99,959,200 for 178,200 shares) between March 23 and April 7, 2026.

Introduction of Progressive Dividends and Dividend Policy

To enhance the stability of shareholder returns, the company has adopted a 'progressive dividend' policy (aiming to maintain or increase dividends without reducing them) as its fundamental stance.

• Target Payout Ratio : Aiming for 30% or higher.
• Dividend per Share Trend : Dividends have shown a steady upward trend, from ¥8.34 in FY2023 to ¥15.92 in FY2024, and ¥16.00 in FY2025 (¥13.50 ordinary + ¥2.50 commemorative). The company has clearly stated its policy to continue stable dividends for FY2026.

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6. Conclusion and Future Outlook

Piers' Q3 FY2026 results confirmed record-high revenue and ordinary profit, with progress against full-year forecasts being exceptionally strong.

While maintaining a solid foundation in its existing store support business for the telecommunications industry, the company is transforming into a high-value-added DX solution provider that fuses AI and content through M&A-driven market expansion and the launch of 'NAJIM works' via the integration of 'Qualiagram' and '2Links.' The company balances a sound financial structure, symbolized by its 66.2% equity ratio, with a shareholder-centric approach demonstrated by share buybacks and a progressive dividend policy. Attention will now focus on the creation of group synergies following the launch of the new company and the speed of its expansion into other industries (toB/toG).