Visional (4194) FY2026/7 Full-Year Earnings Deep Dive Report

1. Executive Summary

Visional, Inc.'s FY2026/7 (fiscal year ending July 2026) full-year results demonstrate significant growth in both revenue and profit, driven by the robust earnings foundation of its core "BizReach" business and the rapid expansion of the "HRMOS" segment. The company reported revenue of ¥99.3 billion (+23.9% YoY) , operating profit of ¥24.6 billion (+14.6% YoY) , and EBITDA of ¥27.5 billion (+18.5% YoY) .

For the upcoming FY2027/7, the company has issued guidance of ¥119.9 billion in revenue (+20.7% YoY) and ¥26.6 billion in operating profit (+8.3% YoY) , signaling a milestone breach of the ¥100 billion revenue mark while maintaining disciplined investment for growth.

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2. Consolidated Financial Highlights and Trends

Visional Group continues to achieve strong business expansion while maintaining a balance between high profitability in its core platforms and disciplined growth investment in new and peripheral areas.

[Slide Commentary: Background and Significance of Group Performance Trends]

As shown in the slide above, revenue has trended steadily upward from ¥56.3 billion in FY23/7 to ¥99.3 billion in FY26/7, expanding approximately 1.76x over three years. Notably, the company maintains exceptionally high profitability, with a full-year operating margin of 24.7% and an EBITDA margin of 27.7% . A key financial strength is the company's established structure, which allows it to not only grow its top line but also execute investments and M&A for future growth while sustaining high profit margins.

Key Financial Indicators: Results and Outlook

• FY2026/7 Full-Year Results

  • Revenue : ¥99.3 billion (YoY +23.9%)
  • EBITDA : ¥27.5 billion (Margin 27.7%, YoY +18.5%)
  • Operating Profit : ¥24.6 billion (Margin 24.7%, YoY +14.6%)
  • Net Income : ¥18.6 billion (YoY +16.4%)

• FY2027/7 Full-Year Outlook

  • Revenue : ¥119.9 billion (YoY +20.7%, +¥20.5 billion increase)
  • EBITDA : ¥30.2 billion (Margin 25.2%, YoY +9.8%)
  • Operating Profit : ¥26.6 billion (Margin 22.2%, YoY +8.3%)
  • Net Income : ¥18.6 billion (Expected to remain flat, factoring in tax reform impacts)

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3. Trends and Customer Base of Core Business "BizReach"

BizReach, the group's primary revenue driver, delivered highly stable performance against the backdrop of the established adoption of direct recruiting in the professional talent market.

• Full-Year Revenue : ¥80.1 billion (+16.8% YoY)
• Full-Year Operating Profit (Before allocation of administrative expenses) : ¥33.1 billion (41.3% margin, +16.5% YoY)
• FY2027/7 Outlook : Revenue ¥92.9 billion (YoY +16.0%), Operating Margin 41.0%

[Slide Commentary: Customer Base KPIs Generating Strong Network Effects]

The competitive advantage of BizReach is summarized by the four robust KPIs shown in the slide:

1. Cumulative Number of Adopting Companies : Over 45,800 (steady quarterly expansion)
2. Number of Scoutable Candidates : Over 3.53 million (continuous expansion of the pool of immediate-impact talent)
3. Number of Active Headhunters : Over 9,500
4. Number of Annual Active Companies : 23,100 (significant increase from 18,800 in FY25/7)

A "two-sided network effect" is firmly in place, where the platform's value increases as both job seekers and companies/headhunters gather, creating a cohort structure that accumulates repeat and continuous usage from previously acquired customers. Furthermore, the revenue mix consists of 32% recurring revenue (system usage fees, etc.) and 68% performance-based revenue (success fees, etc.) , a model that balances a stable foundation with upside potential.

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4. "BizReach AI," Technology Investment, and IP Strategy

Visional is advancing the integration of accumulated matching data with generative AI, utilizing its IP strategy as a defensive moat for competitive advantage.

• Number of Generative AI-related Patents : 94 (as of the end of FY2026/7, among the top tier for Japanese companies)
• Features for Hiring Companies : Automated job posting (approx. 70% of jobs created within 24 hours), candidate search (15% reduction in selection lead time), AI-customized scout messaging (+26% improvement in scout response expectations)
• Features for Job Seekers : AI resume editing (over 40% of those who receive improvement suggestions update their resumes), automated resume creation (used by 30% of registrants), and interactive career consultation AI

By leveraging 17 years of proprietary data and a robust patent network, the company is increasing platform matching efficiency while building barriers to entry for competitors.

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5. Current Status and Strategy of the Rapidly Growing "HRMOS" Business

HRMOS has evolved into an "AI-era management platform" that covers everything from recruitment management and talent management to attendance, labor, and payroll processing, as well as an internal version of BizReach.

[Slide Commentary: HRMOS's Leap as a SaaS Business]

As the slide indicates, key metrics for HRMOS show a powerful growth trend:

• ARR (Annual Recurring Revenue) : ¥10.3 billion (+177.0% YoY) , surpassing the major SaaS milestone of ¥10 billion.
• Number of Active Companies : Rapid growth to 10,699 (+341.9% YoY) .
• Churn Rate (Monthly, 12-month average) : 0.48% , maintaining an exceptionally high standard for B2B SaaS.

Note: While the ARPU level has shifted to ¥80,000 due to the consolidation effect of the Thinkings (sonar ATS) M&A and the inclusion of HRMOS Attendance, the depth of the customer base and cross-selling opportunities have expanded significantly.

Aggressive Upfront Investment Policy

In the second quarter of FY26/7, the HRMOS business achieved quarterly operating profitability (¥33 million), proving its standalone monetization capability. Building on this, the company is intentionally accelerating growth investments to capture market opportunities.

• FY2026/7 Revenue : ¥9.3 billion (YoY +78.2%), Operating Loss ¥480 million
• FY2027/7 Outlook : Revenue ¥12.6 billion (YoY +35.6%) , Operating Loss ¥1.5 billion The company plans to continue aggressive investment in marketing, product development, and sales personnel over the next 2–3 years, prioritizing long-term market share acquisition.

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6. Summary and Future Outlook

The following points summarize Visional's FY2026/7 full-year results and FY2027/7 plan:

1. BizReach as the Revenue Pillar : Sustaining 15–16% annual growth while maintaining a high operating margin of over 40%.
2. HRMOS Growing into a Second Pillar : Surpassed ¥10 billion in ARR and transitioned into an aggressive upfront investment phase to pursue high growth.
3. AI x Proprietary Data IP Moat : Enhancing service experience and productivity through proprietary technology backed by 94 generative AI patents.
4. Robust Financial Position and M&A Utilization : A structure that allows for the agile allocation of abundant cash flow toward growth investments and M&A.

A flywheel has been established where profits generated by the highly profitable core business are reinvested into growth areas, and the company's future business development remains a key focus.